Layoffs - - whaaaa?

interesting. and don't forget the british compensation caps.

"Many banks missed monthly targets for both fixed income and equities trading revenue, and one senior banker called layoffs inevitable if activity doesn't rebound "sharply" in August and September. "

crocodile tears!

this comes at the same times as banks cannot keep on delaying recognition of losses from foreclosures of the 2nd wave (prime instead of subprime, that generate much higher losses). not bullish imho.

related from bloomberg...

Paulson Said to Pare Bets on Recovery as Main Funds Decline
2010-08-05 17:26:52.103 GMT

By Katherine Burton
Aug. 5 (Bloomberg) -- Billionaire hedge-fund manager John
Paulson, whose $32 billion firm has been betting on an economic
recovery by 2012, has pared bullish bets across his funds,
according to a person briefed on the investments.

http://dealbreaker.com/2010/08/layoffs-watch-10-barclays-plans-ahead/#more-26154

12 Aug 2010 at 11:34 AM/ Posted in:
News
Layoffs Watch ‘10: Barclays Plans Ahead?
By Bess Levin

ShareCongrats to all those who made it through yesterday employment intact. Having said that…

A source close close to Phil Mickelson tells us: “There are now serious rumours of a second round of redundancies at BarCap in Q4 of this year, if the business environment does not materially improve.”

Old news. Credit Suisse is also laying off in London. Its always boom and bust in this type of work.

Oh, and bullish.

have given this some more thought, and am repeating here my post from another thread:

having watched too many of these cycles, i can assert that now (August, which is the wrap-up of vacation season, and continuing into September) is exactly when investment banks start taking a hard look at what bonus compensation is going to look like. how they divvy up that pie is always very strategic - - they try hard to make sure they don't miscalculate and underreward the stars or overreward the average performers. (and cutting people before 3rd quarter is over makes it harder for those laid off to argue that they're still entitled to the whole (hypothetical) bonus that they expected to see - - banks can get by with giving severance only at this point in the year).

rumors of layoffs are like trial balloons, in a way (though i have no idea if that's the motivation behind these recent murmurs). they represent a sort of firing the first shot across the bow of employees who are starting to set their expectations for what sort of bonus money they might see at year-end.

if 2010 turns out to be just an o.k. year (for a given bank, or business line) and not a rip-roaring year, a bank can decide to lay off some people as a sort of insurance that they'll have enough money to amply reward the rainmakers, the people they MUST hold on to. it's just a matter of how deep the cuts go, but of course the downside for the bank is that they might wind up miscalculating and leaving a business line understaffed (or even demoralized if they skimp on pay) to a degree that they consequently miss out on business for lack of bodies to chase and close it.

it's all a calculation. but any year that you're midway through 3rd quarter and there's doubt about the economic outlook, the drumbeat of layoffs will begin. i think you want to take it seriously as a possible but potentially real phenomenon that could be around the corner, because 'tis the season. you can't call it a true signal of the macro nyc economy, though, until and unless the cuts actually happen. but the EXERCISE of "how many people can we cut?" is definitely real. and happening now, i'm fairly sure, in certain high-dollar departments of the banks.