Morning Coffee: The real reason Morgan Stanley is cutting staff. When bankers dress inappropriately

Why is it that Morgan Stanley - having hired hundreds of fixed income traders in 2010, laid some of them off in 2013 and declared its continued interest in the business only last June, is now making 25% of its fixed income professionals redundant? 

Try collapsing returns.

The Guardian has been speaking to unnamed Morgan Stanley 'insiders'. These insiders claim that the return on equity in Morgan Stanley's fixed income sales and trading business has fallen to just 5%. It's not clear how high it was previously, but the implication is that it was a lot, lot more impressive than that.

The good news is that in absolute terms, not too many Morgan Stanley fixed income people are losing their jobs. In London, the Guardian says just 100 positions are going. Globally, another 300 people are being displaced.  Morgan Stanley is still saying nothing at all.

Separately, we have written much and often about the art of dressing appropriately when you work in an investment bank. Now Citi has made its own contribution to the oeuvre. The US investment bank reportedly issued a missive to its bankers in Hong Kong regarding appropriate attire for the office and client assignments. Men should wear long sleeved collared shirts, said Citi; women should wear 'dress pants' or skirts and tailored blouses. More informative was what Citi explicitly said it Hong Kong bankers must not wear: fluffy slippers, togas, bandannas, micro-mini skirts and transparent clothing or 'excessively tight or revealing tops.'

Meanwhile:

Credit Suisse wants to GROW its investment bank. It plans to hire in M&A, equity capital markets and emerging markets. (Financial News) 

Morgan Stanley named David Flowerdew to replace Jaideep Bedi as head of U.S. Treasuries trading. (Bloomberg) 

Gordon Brown will give all the money he earns at Pimco to charity. (Financial Times) 

Costs account for 90% of revenues at RBS's Coutts private bank. Unsurprisingly, it is planning to cut headcount next year. (Bloomberg) 

Peter Stevens, ex-head of European equity sales at Credit Suisse, has been named CEO of independent research firm Willis Welby.  (Financial News)

Were it not for the 2000 dot com crash, there would be another 10m finance jobs globally. (Reformed Broker)

"If I am elected, I will come down hard on Wall Street:" Hilary Clinton. (NY Times) 

Perella Weinberg has three good reasons for keeping bonuses very low for 2015. (Dealbreaker)

Hot new macro hedge fund coming to London. (FinAlternatives)

End of an era as Commonwealth Bank of Australia closes its equities prop desk. (Bloomberg)

Don’t even think about discussing the questions you encountered in the CFA exam. (300 Hours)

45 manly hobbies.(Art of Manliness)

What it’s like to be black at Princeton. (Vox)