Investment Banking

What investment banking’s revival tells us about the economy

Now that borrowing is becoming less expensive as central bankers lower rates and a healthier economic picture takes shape, companies are calling up their bankers for help.
Now that borrowing is becoming less expensive as central bankers lower rates and a healthier economic picture takes shape, companies are calling up their bankers for help. Photo: Timothy A. Clary/ Getty Images

Smart investors know the stock market isn’t the economy. In other words, stocks currently trading near record highs don’t mean that the US economy is its strongest ever — though it is doing fine.

Investment banking activity can be interpreted similarly. The many millions of dollars that banks generate from their diverse services for big companies and wealthy clients is an imperfect way to gauge economic health. But it is an important piece of the puzzle to consider.

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