Are Citigroup and Goldman Sachs Making a "Permanently" Bad Bet?

Fixed income trading is in the dumps. Does that mean Goldman Sachs  will never be a good bank again because it relies on fixed income, currencies, and commodities? Or perhaps with some banks cutting back on FICC exposure, some opportunities will open up for the likes of Goldman Sachs and Citigroup , which are sticking with FICC trading.

As reported by MarketWatch, the steady decline in fixed-income trading revenue is now "permanently shrunk," according to Gerard Cassidy, an analyst at RBC Capital Markets. He says the issues stem from more regulation and interest rates being a lot more stable.

In this episode of The Motley Fool's Where the Money Is, banking and financial services bureau chief Matt Koppenheffer and analyst David Hanson discuss whether there's any truth behind this proclamation, or if this is just the type of usual thing analysts say during the downswing of any cyclical event.

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The article Are Citigroup and Goldman Sachs Making a "Permanently" Bad Bet? originally appeared on

David Hanson owns shares of Goldman Sachs. Matt Koppenheffer owns shares of Barclays PLC (ADR), Citigroup, and Goldman Sachs. The Motley Fool recommends Goldman Sachs. The Motley Fool owns shares of Citigroup. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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