What is Investment Banking?

A few days ago I ran across the best definition of investment banking that I have encountered to date.

When I was fresh in the industry it was somewhat of a clouded subject for me. People would talk about “investment banking,” but what, exactly, was that? I was working for a brokerage firm at the time. Was I in investment banking, I wondered? And if not, what did investment banks do that my firm didn’t do?

The term investment ...

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Honest Crap is Better than Fools Gold

Investment advisors and stock brokers see a lot of crap.

Good advisors know crap when they see it. Bad advisors don’t recognize crap for what it is.  The really bad advisors take the crap and sell it to their own clients for fat commissions.

Advisors and brokers are constantly bombarded with products and services in the hopes they will turn around and sell these products to their own clients.

Today I got one such e-mail. It was a company called  More →

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What if Summers had Become Fed Chairman?

What just happened would not have happened. The Fed, which is charged with regulating banks, just told Citigroup they needed to be more stable before shelling out money to shareholders.

This never would have happened had Larry Summers become chairman of the Federal Reserve. There is absolutely no way he would have signed off on tougher requirements for Citigroup. Let’s all breath another sigh of relief that ...

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Yellen is in

Janet Yellen was confirmed today as Chariman of the Federal Reserve.

Say what you want about her being too liberal — or whatever the criticism is — there are two things that I believe are important to point out.

1. This is following a long line of non-partisan appointments. Greenspan with Reagan, which was continued by Clinton. Bernanke (the Democrat) who was appointed by Bush and continued by Obama. And now Yellen. More than anything, they simply seem to ...

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Progress in Central Banking

Apparently Raghuram Rajan is a “sexy” banker.

Good for him. During his time at the University of Chicago, it hadn’t occurred to me that he would have international appeal as an economist and a heart throb (one of my daughters is more into Johnny Depp). If it works to help India’s economy, more power to it.

I write a fair amount of cynical and/or critical posts. I thought I’d break ...

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JP Morgan Hirings – Why the Surprise?

Apparently JP Morgan is coming under investigation for hiring the children of a Chinese official, which may have led to business in China.

My initial reaction to this….yeah, so?

Not that it is “ok” for JP Morgan to be doing something like this, but this sort of thing happens all the time – so much so that it is basically standard operating procedure for the investment banks.

Much worse, I think, than trading favors by hiring children, is the revolving ...

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