Tell all farewell from departing Goldman exec

[GG]

As GG likes to say, it's the same **** that's gone on for years. However, I doubt they behaved this way before they incorporated.

 

Of course it has and I think he's full of crap in a weak attempt to be the next Michael Lewis with 5% of the talent.

 

This passage from his letter is the most astounding for a 12-yr veteran of the trading floor:

 

What are three quick ways to become a leader? a) Execute on the firm’s “axes,” which is Goldman-speak for persuading your clients to invest in the stocks or other products that we are trying to get rid of because they are not seen as having a lot of potential profit. b) “Hunt Elephants.” In English: get your clients — some of whom are sophisticated, and some of whom aren’t — to trade whatever will bring the biggest profit to Goldman. Call me old-fashioned, but I don’t like selling my clients a product that is wrong for them. c) Find yourself sitting in a seat where your job is to trade any illiquid, opaque product with a three-letter acronym.

 

What a bunch of self-serving superficial drek. I'm sorry but if you're on the other side of the phone line from Goldman's sales or trading, your immediate thought is what are they trying to push over on me? He was not selling Florida real estate partnerships to grandmas on fixed income. So if he comes to this epiphany 12 years into his career, while collecting a nice payday over that time, is more transparent than Kim Kardashian's brain.

 

And please, stop with the whole Wall Street private partnerships were good but public offerings were bad. Managements have their fortunes tied in the companies' stock whether they're public or private. Don't think that Jimmy Cayne or Dick Fuld weren't thinking about their equity values when they were sinking their respective firms. But hey, Michael Lewis floated that theory 20-yrs ago, so it must be true.

 

The distinction that financial press ignores is not the public/private ownership, but the eternal battles between the trading floor and the bankers. How many financial journalists, let alone the public, know the difference. In my experience, very few. So everyone just repeats what the guy before them said, because you don't want to be the idiot who challenges Michael Lewis. But what the hell? They all work for a "bank" so they all are bankers. Yet power at financial firms always goes to the units that generate most money, and over the past decade the trading floor made a lot more money than the other parts, so naturally you have more traders in charge of banks.

 

You can make an argument that if you have more traders running firms like that, they'll take on bigger risks to make more money (aka Corzine), but to say that the mindset of the firms has changed over the last decade is utter crap.

[3rdnlng]

401ks are total bull ****

 

 

And again, Davey pins the target on his back, drops his pants and moons everyone else.

[Dave_In_Norfolk]

And again, Davey pins the target on his back, drops his pants and moons everyone else.

Your parents never gave you any attention?

[3rdnlng]

Your parents never gave you any attention?

 

 

That comment was DIN worthy.

[birdog1960]

haha do you have any idea what the concept of irony is? Which side is willfully engaged in a smear campaign against a small group of Americans, screaming about "corruption" and "fairness", exaggerating and down right lying about what this group is engaged in and their influence, turning said group into a bunch of caricatures hell bent on destroying "The American Way", and above all else, demanding that the government harm this small group for the greater good?

i'm really not concerned with a group as powerful as the free syrian army. more concerned about the assad's of the world.

[TPS]

Of course it has and I think he's full of crap in a weak attempt to be the next Michael Lewis with 5% of the talent.

 

This passage from his letter is the most astounding for a 12-yr veteran of the trading floor:

 

 

 

What a bunch of self-serving superficial drek. I'm sorry but if you're on the other side of the phone line from Goldman's sales or trading, your immediate thought is what are they trying to push over on me? He was not selling Florida real estate partnerships to grandmas on fixed income. So if he comes to this epiphany 12 years into his career, while collecting a nice payday over that time, is more transparent than Kim Kardashian's brain.

 

And please, stop with the whole Wall Street private partnerships were good but public offerings were bad. Managements have their fortunes tied in the companies' stock whether they're public or private. Don't think that Jimmy Cayne or Dick Fuld weren't thinking about their equity values when they were sinking their respective firms. But hey, Michael Lewis floated that theory 20-yrs ago, so it must be true.

 

The distinction that financial press ignores is not the public/private ownership, but the eternal battles between the trading floor and the bankers. How many financial journalists, let alone the public, know the difference. In my experience, very few. So everyone just repeats what the guy before them said, because you don't want to be the idiot who challenges Michael Lewis. But what the hell? They all work for a "bank" so they all are bankers. Yet power at financial firms always goes to the units that generate most money, and over the past decade the trading floor made a lot more money than the other parts, so naturally you have more traders in charge of banks.

 

You can make an argument that if you have more traders running firms like that, they'll take on bigger risks to make more money (aka Corzine), but to say that the mindset of the firms has changed over the last decade is utter crap.

Of course, the mindset is "making money" regardless. But you don't think there's a difference between risking your own money vs risking someone else's?

[GG]

Of course, the mindset is "making money" regardless. But you don't think there's a difference between risking your own money vs risking someone else's?

 

Of course there's a difference and that's what Volcker rule is trying to address. But that and above have nothing to do with Smith's letter, because even if they weren't doing proprietary trades, they would still be moving products on their desks.

[truth on hold]

So are evil banks worse than evil corporations? What if it's an evil multi-national corporation, then what??

 

And what if it's not a Wall Street bank but just Mom & Pop Savings, are they still evil?

 

 

Can we get a "progressive" over here to help us sort it out? So confusing!

The knuckleheads think they're defending "free markets" somehow when the institution in question gets bIllions in preferential funding from the Federal Reserve and enjoys an implicit Treasury guarantee when they face insolvency

Edited March 16, 2012 by Joe_the_6_pack

[DC Tom]

His self described title was head of equities derivatives for EMEA. In reality, he was a VP (huge difference at the firm) and his department consisted of one person. So, no he never had contact with American consumers.

 

In other words, he's a drama queen.

[GG]

In other words, he's a drama queen.

 

As is nearly every trader.

[Chef Jim]

401ks are total bull ****

 

Explain please.

[Magox]

Capitalism certainly isn't perfect, sometimes the goal of profit hurts the client. That is a reality and that is one of its major downfalls, but it's the most productive economic system that lifts people from the lower income levels to the middle class in the world that we have today, and there isn't a close second that compares.

 

It's incentives vs. needs and dependency.

 

Capitalism is an incentive based economic system, which of course leads to more competition through the private sector. competition generally leads to better products, services, innovation and lower prices.

 

Socialism, tends to peoples needs administered through the government.

 

The problem is if you have most of your "needs" such as healthcare, extended unemployment, welfare programs, housing, food etc. does this lead to more dependency from our population? And does this dependency promote more self-accountability and increased productive human activity?

 

The answer is obvious. All one has to do is look at socialism throughout the world and the answer is right there.

 

So to go back to the topic, Goldman Sachs like many other investment banks certainly cater to the stockholders more so than their clients. It is quite the conundrum they face, balancing profits and customer care. Through out time, competition will lead to better customer care, but it's the culture that has to change in order for this to happen.

 

Having said that, lets be real here, customers of Goldman sachs, whether its companies looking to go public, or municipalities looking for funding for local public projects, investment advisory services or what have you, are generally very happy with Goldman's services. That's a fact. However, it's not so much their clients that usually get hurt from some of their actions, but it's usually those on the periphery related to Goldman sort of activities that sometimes get burnt.

 

I would say that a solution is to have extremely tough legal penalties for those that commit churning sort of activities. The dilemma is how do you classify that? And that's something that regulators and policy makers will have to come up with. Also, there has to be more clawback policies. You can't have someone make a huge bonus based on one years results, to only have the decisions made from that huge bonus year end up causing loss in the future. Basically the client loses, but the Investment Bank employee walks off with a large compensation. So there has to be reforms made in this area as well.

 

In short, it's not the perfect system, but companies like GOldman do much more good for our economy than some people give it credit for, but at the same time, we have to constantly be looking for ways to improve the system through logical reforms and regulations that won't inhibit growth.

Edited March 16, 2012 by Magox

[OCinBuffalo]

In other words, he's a drama queen.

Or he's looking to begin his political career.

 

Here's the things that I'm not buying:

The coincidence of the timing. Are you trying to tell me that as soon as OWS dies out....this guy just "happens" to appear. Conveniently attempting to recycle the argument? It takes 12 years to arrive at this conclusion? Where was this guy in 2008?

 

The coincidence of the message. This is far too cut and dried. It's far too prejudicial. And, back to the timing thing, it's far too convenient.

 

The approach. Why would this guy voluntarily make himself a public figure, subject to all the scrutiny...with no prospects in the Financial sector, unless there's a Phase 2 to the plan? Yeah, he might have FU money stashed away, but if so, why not just quit and sit on a beach? Why make your life into hell, unless, you WANT the attention? I considered him starting his own fund/firm, and rejected the idea: why would a guy start a business like that based on bad blood? Makes 0 sense. You need to prove your experience is worth something in order for people to trust you....why would you denigrate it, and yourself?

 

The obvious potential for quid pro quo.

 

No, this guy took a rocket launcher to the Financial Services Sector bridge....and is never going back, given this, the timing and the message, and the fact that the sitting President now owes him one....starting a political career is the most likely explanation.