Back in the 80's, bankers were at the top of the pyramid at investment banks. The booming economy, lower taxes and regulations, all prompted a massive M&A and IPO wave, and bankers reaped the rewards. In the late 90's Equity Research Analysts, especially those covering the hot tech sector, were making massive bonuses. In the early and mid-2000's traders ruled and became the envy of bankers.
Now, with the Volcker Rule having dismantled the high flying prop desks and Basel requirements imposing stricter limits on balance sheet risk, are we seeing another power transition? This time to asset/wealth management? It makes sense since trading is virtually dead, banking is way too cyclical, while institutional and individual clients will always need the services of money managers. The new Credit Suisse CEO for instance has said that he will shift the bank's focus towards AM. And UBS has already laid off a lot of bankers and are doubling down on AM as well.
