How Wall Street Really Makes Its Money | JPMorgan, Goldman Sachs & BlackRock

Hello and welcome back to the Market Maker podcast and forget standard earnings spreadsheets and boring quarterly tables.

Today we are looking under the hood of global finance to answer one simple question.

How does Wall Street really make its money right now in 2026?

From BlackRock's record $15.5 trillion fee machine we saw in their quarterly earnings just this week,

to Goldman Sachs' secret SpaceX paydays. We're going to break down who's winning, who's losing.

And yeah, big shout out to everyone who watched the last episode.

We broke 100,000 views on YouTube first time for the show.

And Piers, I said to you, literally just before I clicked record, like, is there anything that you want me to do,

specifically go into some point of the research we've done and just to let our community know how diligent you are?

that you said no it's all good let's just freestyle it like

normal that's right let's go let's see what happens

yeah i can't tell you what we're going to talk about yet let's

find out right well look before we go

into uh as i said sort of under

the bonnet of some of these quarterly earnings so you know kind of catalyst

for this is we've had all the big major wall street banks report as well as some of the big asset managers uh indeed the world's largest black rock before that let's set

the scene what's the sort of macro setup that this particular Q3 earnings round has come into

yeah I mean well hang on can I just qualify that macro

setup specifically for banks or you mean broadly for the whole economy set it up for banks okay good so there's an important

it's important difference i think um so

we come into this earnings season

if you look back over the last three months i think for sure the

biggest uh sort of headline of

the quarter if you like is bond yields you

know we've been as guilty as everyone else banging on about bond

yields um to a blue in the face we've had a really really big move to the upside in in

government bond yields particularly but you know across across the

spectrum right so um this is interesting

for banks and it's perhaps not immediately obvious

but we'll dive into some numbers in a second but ultimately if

you're thinking about big wall street banks their fixed income trading desks

have underperformed in this

quarter so we'll talk about why because

at the same time when i say that you switch over to the other side of the the kind of open plan trading floor and you've got your equities team and they're smashing it, right?

They're going great guns and delivering some really strong numbers.

So on the trading side, I think it's interesting that you've got a difference in performance and we'll explain why in a sec.

But, you know, broadly, look, we've got this situation where inflation just won't go away, right?

As a problem, it's just nagging and nagging.

And just to add salt to the wounds, we had U.S. inflation data announced earlier today.

And it's higher than expected, I'm afraid, ladies and gents.

When you look on a year-on-year basis, inflation was 3.7%.

Now, the problem with that, well, A, it's obviously a long way above 2%, which is the Fed's target.

But the problem, we thought we peaked for this year. We thought we peaked back in May.

obviously this is mainly driven by the

straits of four moves us iran you know we talked about this

a lot right oil prices moving up feeding through into

broader economic corners and this is leading to inflation right it spiked and we hit 4.2 percent in may then it dropped off 3.5 in june

3.4 in july 3.4 in august we thought right it's just settling back down fine great great but bang It's gone from 3.4 back up.

So this is the first move to the upside we've seen in inflation since May. We're not at that May peak, but obviously it's the direction, right?

We were hoping that we were trending back down. We're not. So that's quite a kind of significant directional shift there.

And this is feeding through into interest rate expectations.

The Fed have two more meetings left this year. Give me the stats.

what's the chances of a hike in october

so we've got a meeting in two weeks time two weeks today and

then they'll have a final meeting in december yeah so there's

been a bit of a knee-jerk reaction looking at the

fed watch tracking tool which is just

looking at short-term interest rate futures to look at the implied

probability of rate hikes and that has changed so it was looking quite

favorable priced in to remain on hold at that meeting on 28th of october that's now at 56 percent