Friday’s Headlines: Wall Street Bankers’ ‘Thrill is Gone’

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Dwindling pay and heavy regulation have taken all the joy out of investment banking. Or so says a BusinessWeekarticle which aims to explain Wall Streeters’ poor attitudes of late.

Wall Street set pay and profit records half a decade ago by wagering billions of borrowed dollars on lightly regulated products that didn’t exist a generation earlier. The rewards, which swelled even after the financial system almost collapsed in 2008, have been replaced by restrictions and malaise, says the article.

The magazine quotes one credit derivatives trader: “Right now at work I’m making less risk decisions—and I enjoy taking risks. If you’re in it for the game and the fight, the game’s over and the fight’s over.”

A former proprietary credit arbitrage trader quips: “There’s no sexiness, there’s no fun, there’s no intellectual intrigue, either. A lot of my friends who actually lingered for the last four years are all now getting fired anyway.”

A New School psychology professor summed it up: “If you’re essentially telling them to be like everybody else and to follow rules, you’re amputating a large part of who they are, who they consider themselves to be,” while an NYU colleague added: “It would be like a drug addict not getting what he has to have.”

Other news:
RBS marks $3B first-half loss on one-time charges. NY Times
Apollo’s Q2 profit fell 84% on difficult markets. DealBook
French insurer AXA’s first-half profit fell 36% but beat estimates on higher premiums. WSJ
Vanguard dropped AllianceBernstein as subadviser for three of its mutual funds. Investment News
Wednesday’s NYSE stumble has electronic trading advocate Knight Capital fighting for survival. DealBook
The risk of the one-year MBA.  WSJ
Japan widens its insider trading investigation to Wall Street, including Goldman. DealBook
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