John Pitera's Market Laboratory Message Board

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Strategies & Market Trends : John Pitera's Market Laboratory

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To: Hawkmoon who wrote (13183)	6/7/2012 11:46:55 PM
From: Elroy	Read Replies (1) of 33421

Aside from collecting interest on debt holdings (private and governmental), how can a bank make money in order to restore it's balance sheets? Commissions on trades executed by the bank for its clients Service charges levied on its customers Fees charged for investment banking services Sell a few branches! That's what comes to mind... Proprietary trading in various markets, of course.. I don't think this is a likely option for a bank with a weak balance sheet. If the balance sheet is weak, the bank is likely to reduce proprietary trading, not increase it. And since the most lucrative part of such trading involves extreme volatility Also not true. Volatility doesn't make prop trading more profitable. You're assuming for some reason that the bank would more often than not be on the right side of the volatile position. There's no reason to believe that to be true.

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