Stephen Foley: Titans of Wall Street face a loss of power

 

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The Independent Online

US Outlook: This will hardly satisfy the scores of #OccupyWallStreet demonstrators staging a sit-in in the Financial District here in Manhattan, but it has been a good week for those of us who want to cut the overmighty US banks down to size.

The titans of Wall Street are continuing to retrench in the face of less lucrative trading, in no small measure because of new rules and practices adopted since the credit crisis. Goldman Sachs might even post a quarterly loss, for only the second time as a public company.

And Moody's, the credit rating agency, warned that debt issued by major banks such as Citigroup and Bank of America is more risky than it once was, since regulatory reforms that make it easier and safer for the government to let them fail. The rating downgrades this week do not imply that the problem of too-big-to-fail banks is over. There is still a chance of government bailout aid in extremis, for which Moody's gives their credit ratings an upgrade. But piece by piece, the titans of Wall Street are losing their power.

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