Will Banks Like Bank of America and JPMorgan End Small Banks? | Where the Money Is - 12/4/13

TL;DR

Smaller mortgage lenders gaining market share, Volcker Rule impacting Wall Street, EU fines banks for rate-fixing.

Transcript

when it comes to banking is small beautiful we debate you're in the right place folks because this is where the money is welcome to the show it is wednesday i'm matt copenhefer this year is david hanson and david hate to have to bring this up but you lost in our fantasy football playoffs yesterday so you're basically done what are you gonna do with... Read More

Key Insights

• 🌎 Smaller mortgage lenders are gaining market share from larger players like Countrywide and Bank of America.
• 💄 The Volcker Rule is causing uncertainties for Wall Street, particularly in market-making activities.
• ☠️ EU fines on banks reveal manipulative practices in fixing global interest rates.
• 😀 Mortgage REITs face headwinds due to reducing housing inventory.
• 🥺 The impact of reduced housing inventory can lead to opportunities for home builders.
• 😘 Valuation study is crucial before investing in home builders amidst lower supply and potential price increases.
• 🤑 Fantasy cricket and financial investing have similarities in blindly throwing money without a thoughtful strategy.

Questions & Answers

Q: Why are smaller mortgage lenders gaining market share?

Smaller mortgage lenders are taking a larger share of the market due to the decline in market dominance of larger players like Countrywide and Bank of America.

Q: How is the Volcker Rule impacting Wall Street revenue?

The Volcker Rule affects revenue by potentially impacting market-making activities, like buying from clients and reselling securities, which are key revenue sources for banks like Goldman Sachs and JPMorgan.

Q: What led to the EU imposing fines on banks for fixing interest rates?

Banks like Deutsche Bank, RBS, JP Morgan, and Citigroup were fined for manipulating benchmark interest rates, like Euribor and Yen Libor, showing collaborative efforts to rig these rates.

Summary & Key Takeaways

• Smaller mortgage lenders are overtaking larger ones in market share.

• Volcker Rule impacts revenue for Wall Street due to market-making concerns.

• EU imposes fines on banks for fixing interest rates.