New Technology and Rules Transform Bond Market – NYTimes.com

New Technology and Rules Transform Bond Market – NYTimes.com.

Bond traders have long defined Wall Street’s swagger and, in good years, generated a large share of its profits. Now, though, an upheaval is taking place in the bond business that is wiping out billions in profits and thousands of jobs.

Wall Street banks like JPMorgan Chase, Goldman Sachs and Credit Suisse managed to keep their grip on the bond market in recent years, amassing huge inventories of bonds for clients and trading them mostly in private over-the-phone transactions.

But tighter regulations being enacted this year and new electronic trading technology being rushed to market are threatening to permanently constrain this bastion of big bonuses and risk-taking.

“It was a rock-solid kind of career not too long ago,” said Lou Ricci, a co-founder of the Hagan-Ricci Group, a headhunting firm. “You give me a really good bond trader right now, I probably can’t find them a job.”

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