Implausible winning streak

Doug Henwood

So the trading desks of four big investment banks—Bank of America, Citigroup, Goldman Sachs, and JPMorgan Chase—made money every working day last quarter, a 63-day streak. Goldman never made less than $25 million a day, and over $100 million on 35 days.

There is no way that anyone could do this just by being clever—it’s mathematically impossible. There’s too much short-term randomness even in strongly trending markets. And they’re probably not just making it up, Bernie Madoff-style. How are they doing it? Maybe Congress, if it’s interested in more than grandstanding to entertain and divert the masses, could launch a follow-up to the Goldman inquiry. You can do a lot with subpoena power. Inquiring minds await…

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