Lord Turner's review of financial services regulation is another nail in the coffin for banks' prop desks, and quite possibly for larger hedge funds.
Turner is calling for UK banks, UK subsidiaries of international banks, and hedge funds which have become 'bank-like in nature or systemic in importance,' to substantially increase the amount of capital they hold, and to triple the amount of capital they hold against trading books.
According to the latest missive from the CEBR this will result in up to 50,000 job losses in the City in years to come.
Traders seeking to escape the regulatory thrall may well be expected to congregate in small non-systemically significant firms falling below the FSA's radar. According to hedge fund blogger Fintag, prime brokers and custodians are already noticing a proliferation of one man bands.
Working for a tiny hedge fund has its disadvantages though, not least the fact that many are expected to go out of business before the year's out.
"From the point of view of governance, due diligence, independence and administration, investors now want hedge funds to be large," says John Godden, founder of hedge fund consultants IGS Group.
"There were 20,000 hedge funds in the world and by the end of the year there will be around ten thousand," he adds. "If someone came to me and said they wanted to set up a small fund with a single manager I'd advise them to join a larger player. Investors just aren't into it."