After last week we actually saw some volume participation for the first time in 2011, today the no-volume meltup has resumed. The chart below shows the relative to average volume in the ES. Which ironically shows the Catch 22 the banks find themselves in: the higher they run up the market, the less participation there is, the less trading volume, the lower commissions, and the lower the profits from the traditionally biggest contributors to bank P&L over the past 2 years: flow and prop trading (as confirmed recently by Goldman, Morgan Stanley, JPM, Jefferies and everyone else). Which simply means that banks will have to increasingly rely on the Treasury curve trade (and of course, fudged accounting) to make their bottom line. This would work if consumers had actually stopped deleveraging. Which they haven't. Meaning simply that banks will need to make all their trading profits on market distributions and other crashes that see volume spike. But that as we now know, is contrary to the Fed's third mandate. A curious bind indeed.
h/t Andrew Yorks