April 30, 2018 / 11:09 PM / 24 days ago

HIGHLIGHTS-Goldman's shrinking equity trading desk, JP Morgan's Erdoes on volatility

BEVERLY HILLS, Calif., April 30 (Reuters) - The following are highlights from Monday’s Milken Institute Global Conference in Beverly Hills:

GOLDMAN SACHS PRESIDENT DAVID SOLOMON, ON THE INVESTMENT BANK’S EQUITY TRADING BUSINESS: “Changes have gone on in our businesses and have gone on for a long period of time. It’s not something that is just recent. But it’s compounding. You look at the equity trading business, for example, when you go back 20-30 years we would at Goldman Sachs have 500 people making markets in stocks and prices in stocks every single day. Today we have three - all going off technology platforms. But those businesses continue to change. The secret is how do you navigate the art of going from a business that is analog onto technology platform that has businesses that have never had technology platforms for a long time. How to adapt changes in your clients and customers and interfaces they require. It requires a lot of investment and it requires balance.” MICHAEL CORBAT, CEO of CITIGROUP INC, ON THE GLOBAL ECONOMIC OUTLOOK: “I would use a highly technical term when I describe the world today. The world’s OK. We see governing central bank bodies that are likely to remain consistent around the stance that they have taken. So we shouldn’t see any significant curbs down the road.” He said the two indicators that the economy is strong and positive: Housing and job markets.

MARY CALLAHAN ERDOES, CEO OF J.P. MORGAN ASSET MANAGEMENT, ON VOLATILITY: She said a return of volatility was not going to be a huge risk to financial markets and could make active management more important. “Volatility won’t unravel things,” Erdoes said. She was concerned that volatility might scare away some investors who were burned during the last financial crisis and will remain risk averse. “It will really affect the people who are still psychologically damaged from 2008,” she added. U.S. TREASURY SECRETARY STEVEN MNUCHIN, ON U.S. TAX PLAN: “The tax plan was a major component to creating economic growth, getting competitive tax rates for both corporations and small businesses. We have the lowest small business rates since the 1930s and changing from a worldwide system to a territorial system. So we are seeing a lot of money now being invested in the U.S. and we are seeing the impact of that on the economy.”

MNUCHIN ON STOCK BUYBACKS: “Stock buybacks are a mechanism companies can use to return capital to shareholders. There are lots of companies that are raising capital. We’re seeing a lot of activity in corporate America.” (Reporting by Anna Irrera, Lawrence Delevingne and Liana Baker; Editing by Cynthia Osterman)

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