A Goldman trading desk that once had 500 people is down to three

Bloomberg/Sonali Basak and Christopher Palmeri/4-3-2018

“Many Wall Street traders are concerned about being replaced by machines in the future, but at one Goldman Sachs Group Inc. unit it’s already happened. ‘Equity trading: 15-20 years ago we had 500 people making markets in stocks. Today we have three,’ Goldman Sachs President David Solomon said Monday at the Milken Institute Global Conference in Beverly Hills, California. Solomon said the introduction of more technology into the trading business has made it more efficient for clients, while also introducing new risks. For Goldman Sachs, it has changed the mix of its workforce, as the bank has 9,000 engineers on staff and more employees are focused on regulation.”

MK note: It is easy to understand that 497 human market makers were replaced by machines, but what is a little more difficult to piece together is what the trend it represents might mean for financial markets now and in the years ahead.  What do we have when we subtract, or even just dilute, the human element from the financial marketplace?  An interesting question. . . . .  We explore that problem with respect to gold ownership and the gold market in an upcoming News & Views Special Report titled The case for gold in the era of financial virtual reality – On the holodeck the markets are telling us something but we know not what. This special report will be released in the clear soon and we will post a link to it here at MK’s Short & Sweet, but if you would like to be included on our e-mail list for this issue, future regular issues and special reports, we invite you to register for a no obligation FREE SUBSCRIPTION at this link.

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