Terry Smith: Broker calls for more business for brokers

This from Terry Smith of Tullett Prebon is fun.

Leave aside what he says and, as with any pronouncement from a politician, look at what he means.

An inter-dealer broker is insisting that the investment/retail banking nexus much be broken up.

This would of course create much more business for inter-dealer brokers as all the internal current business would now become external business to be, at least sometimes, transacted through inter-dealer brokers.

Talk your own book much do you Terry?

3 thoughts on “Terry Smith: Broker calls for more business for brokers”

  1. Agree. He also rails against Salomon, Bear Stearns and Lehman, none of which were ever retail banks.

  2. At least he’s talking up business even if he is calling for a bit of privatized rent seeking.

    I like Terry Smith, if for nothing else than his willingness to allow teams of traders to bugger off to Switzerland to reduce their tax bills (and Tullet Prebon’s NI bill).

  3. Oh yes, brilliant idea, having retail banks run by people who have spent all their lives working in retail banking. People like Adam Applegarth, for example…..oh wait…..

    I know I’ve ranted on and on about this before, but full separation of investment & retail banking would NOT have prevented the failure of Northern Rock, Bradford & Bingley or Lloyds. Nowhere in the proposals for ringfencing (or separation) is anyone suggesting that retail banks shouldn’t be allowed to sell loans on to an SPV for securitisation. Nor is anyone except the loons in Positive Money suggesting that retail banks shouldn’t be able to fund themselves on the interbank markets, or issue bonds to the capital markets for that matter.

    As for this Glass-Steagall stuff – why don’t people understand that the growth of the unregulated sector, so-called “shadow banking”, happened BECAUSE of Glass-Steagall and other regulations? The worst part of the international crisis was the unregulated (and uninsured) sector suffering a liquidity crisis of such proportions that governments were forced to intervene to prevent it collapsing – because it had grown so large and so important that it threatened the global financial system.

    I’d like to say the man’s a loon, but “plausible rogue” seems more apt.

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