Chillin' out till it needs to be funded
One wonders after the network interview of Bob Diamond, if the team caan do it again. A rather hackneyed cliche to proffer for a team that did earn well, though it ended up at 6.6% RoE and claims to be capable of earning a double digit ROE as the largest fixed income desk globally when admitting it cannot hope for an upturn in Currency and commodity returns when interest rates are close to zero
For someone which is abjectly unable to operate internationally , just UK retail and acquisitions in the UK and the continent may not be able to get ROE back to double digits. Most leveraged Fixed Income markets and high yield markets have become illiquid and are decreasing in size despite good returns. Munis for example will have $425 bln in redemptions this year and only $325 bln in issuances, leading to a natural contraction in market size. And where one is confident JP Morgan will be there and even Goldman Sachs will come back, one cannot say the same for BarclaysOf course UK retail has returned to an even keel and Barclays Capitalis strong enough for an impact but the spread required to be global does not depend on just acquisitions and divestments on own account even as advisory streams and credit for investment banks are similar to what they were in pre crisis markets.