Wall Street’s famously type-A culture has always prized those who sacrifice their own well-being – physical, emotional or otherwise – for the good of the firm.
Never before has this conviction been put to such a high-stakes test. Late last week, WSJ broke a story claiming 20 traders on a desk at JPM’s Manhattan headquarters had all been sickened after the bank asked traders to come into the headquarters on March 9, a day that will be remembered as one of the most brutal sessions in market history, which presumably netted the bank a major windfall in trading revenue (that day, the bank traded more equities than it ever did during a single day).
Because some of the WFH and back-up offices across the river were having technical difficulties, the bank had asked all of its traders to return to its Manhattan headquarters, despite widespread worries abut the virus.
Now, those traders will likely be celebrated by their colleagues once all of this over for refusing to be cowed by the corona.
While Larry Kudlow and Steven Mnuchin have promised that the administration won’t reopen the economy until it’s safe, it looks like the big banks and their trading desks simply can’t wait that long. With their “essential” employee designation making it easier to call them back, Bloomberg reports that more banks are asking employees to return to the office, or back-up emergency spaces, because trading desks simply can’t handle all the volume without all of their equipment handy.
One JPM trader in London said the bank never seemed to put his team’s health first; initially, they were crammed into a basement in a back-up building outside London with a bunch of back-office humps. Then, the humps were moved, but the traders still didn’t have enough space to social distance.
Understandably, the handling of the situation has led to something of a hit to moral, like a similar incident at Bank of America, where a trader was actually exposed. Some traders at Cantor Fitzgerald affiliate BGC Partners, a high-frequency trading firm, told BBG that management sent emails with conflicting messages.
Inside BGC Partners, an affiliate of Cantor Fitzgerald, workers received a memo marked “important” last month notifying them that no government orders were stopping them from showing up. “We remain open,” the memo said. “Driving to the offices and using mass transit are permitted in order to travel to and from our office.” Some BGC employees privately complained they felt pressured to keep coming downtown — even as other memos laid out the option of working from home. A BGC spokesman declined to comment.
Though, to be fair, others said the firm acted responsibly by assigning skeleton crews to run trading floors at disaster recovery sites or the main office. Several traders shared stories about managers sending their entire desks to work from home after one worker got sick.
One member of a JPM sales team said management’s naming-and-shaming tactics were on full display in an email chain connecting 100 people at the bank as they sought to work out in-office scheduling for the ‘skeleton crews’.
One worker on the sales team noticed a colleague wasn’t on the list and asked where he’d be.
“Corona Town, U.S.A.,” the person wrote back. Then one of the bank’s credit-trading leaders, Nicholas Adragna, weighed in: “The trading desk will be in the office unless they have a medical condition with a dr’s note.”
More than 100 employees were on the message chain seen by Bloomberg, and some were horrified. It came soon after an outbreak of Covid-19 inside JPMorgan’s Madison Avenue headquarters, in which at least 16 people tested positive on a single trading floor. Some employees complain they’re getting conflicting messages from middle and senior managers about coming into offices, where billions of dollars of profit are at stake, and that they would rather follow the advice of government officials to hunker down at home.
Others described at-times intense pressure from managers for sick workers to continue working when they should be resting. Another banker said he kept working until his symptoms were too severe, and once he reached that point, managers gave him plenty of time off to recover.
The final press has been quick to bash the banks for prioritizing their own greed over employees’ well-being, not exactly new territory for Wall Street.
But here’s the thing: As we explained earlier, with equity markets still seeing massive swings, many are worried about liquidity drying up with so many traders working from home. Many dealers working remotely don’t have the full capacity to transact. The result is wider spreads, less efficient price discovery and – sometimes – face-melting selloffs.