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Comment by brycelarkin | Hacker News Reader

Equity Research and the Investment Banking Division are completely different groups with procedures in place to make sure they never interact with each other.

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Not never. They speak regularly, with an attorney on the line, following approved topics and protocols.

They speak with an attorney on the line so the conversation is privileged and cant be subpoenaed.

... that doesn't give the conversation attorney-client privilege, and I think it just tends to make the judge angry when you try to claim in court that it does--it's not an effective technique in practice.

It's a phone conversation on an unrecorded line so the presence of the attorney isn't really relevant in that sense.

To synchronise schedules and blacklists. Not to discuss valuations.

It's still very awkward for them to have such different valuations.

It's awkward only in the sense that the valuations are absolutely worthless. You can back test the 1 year target estimates of almost any company to see for yourself that they are junk, in fact this topic has been studied almost to death if you do a search on Google Scholar.

savage, and interestingly enough all these financial analysts still have good paying jobs

IMHO it falls into the same category as content farms trying to drive traffic into buying a product.

Nope. Look at the dot-com bubble and bust when in a single firm equity research pumped and investment banking got people to buy.

I asked a banker this exact question back then. All I got was flowery language of great walls and reputational damage.

We all know what happened. The bubble popped. The two sides don't need to talk. The equity research is public. Incentives are such that both sides want to pump.

The dot-com bubble predates FINRA Rule 2241 which was adopted in 2015.

[1] https://www.finra.org/rules-guidance/rulebooks/finra-rules/2...

Right.

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