Who Would Want to Be at Goldman Sachs?

Daily Telegraph December 2, 2009

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By James Quinn Business Last updated: December 2nd, 2009

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Times may be tough on Wall Street this festive season, but none as tough as at Goldman Sachs. Or at least that's what the investment bank and its apparatchiks would appear to want us to believe.

With the beginning of Advent, so comes the trickle, trickle of well positioned stories, comments and suggestions highlighting just how Goldman-ites "“ or should that be Sachs-ers "“ are suffering at this time of year.

First came news that its bankers are not being allowed to celebrate Christmas or whatever holiday they choose to at this time of year en masse. According to Henry Blodget's respected Business Insider website, a diktat went out last month effectively stopping those who worship at the temple of the Vampire Squid from gathering in numbers of more than 12 this yuletide.

Then came news that 300 New York workers had been encouraged to give up part of their Thanksgiving to help others less fortunate than themselves.

And finally – the piece de resistance. Word that its bankers are so afraid for their lives "“ or their Aston Martins "“ that they're resorting to carrying guns.

To be fair, the Bloomberg comment on which such an outlandish suggestion is based does not name any names, although the writer "“ who is an author and former Morgan Stanley banker "“ does say that she has spoken to the New York Police Department, which off-the-record confirmed some of the names she gave to them (although doesn't print) have taken applied for gun permits.

A quick word with my man inside the bank pooh-poohs the whole gun-toting idea, pointing out that it was a "commentary and not a news report", before going on to dismiss the report out of hand.

Of course, the law of averages states that at least some of Goldman's 31,700 bankers will have a gun licence, especially given the percentage of those which live in the US, where one in five hold such a permit.

But what gets me is the suggestion that staff at the investment bank are somehow living in fear of their lives. That things have gotten so bad that the idea that they need to “weapon up” is given credence not just by the article’s author, who to be fair does later mock the thought, or the powers that be at Bloomberg, is both shocking and misplaced.

Yes, some venom might be spilled in some chat rooms and comments on the end of blogs like this one about what people think about Goldman, and every few months several hundred protestors might march on the bank’s offices to rail against what they see to be as the bank’s failings – but as far as i'm aware, there have been no threats on lives, no violence, no physical damage. Other than the odd nasty word in the US Congress, the only real damage that chairman Lloyd Blankfein and his foot-soldiers have had to put up with what has been written about them by the media on both sides of the Atlantic.

And this shows. After the apologies, the tongue-in-cheek comments about “God’s work”, and the charitable donations, while Goldman has been busy trying to prove that it doesn’t deserve all the flak and attempting to generate thousands of column inches of positive PR, for the rest of the bank it has been business as normal.

And for Goldman, business as normal means bumper profits. The third quarter delivered profits of $3.19bn, and all the signs point to a bumper fourth quarter. Brad Hintz, banking analyst at Sanford Bernstein, recently raised his earnings per share estimates for the fourth and final quarter of 2009 by 15pc, because he believes the bank will reduce the amount it will hand over to its bonus pool in the three month period.

But even with that reduction, Hintz reckons Goldman’s compensation pool will come in at $20.2bn this year – equivalent to that seen in 2007, itself a record year "“ delivering $637,000 – or £384,000 "“ of pay and bonuses per employee.

Although the bank’s latest attempt at explaining itself "“ a somewhat unrevealing account by former Goldman analyst Bethany McLean in next month’s Vanity Fair, replete with pictures by star snapper Annie Leibovitz "“ intimates that Goldman’s masters of the universe are not well remunerated compared to the likes of hedge fund managers George Soros or Julian Richardson, with gifts like the bumper bonuses that will be delivered come the end of the year, no-one should really feel sorry for Goldman-ites this Christmastide.

Tags: bonuses, firearms, Goldman Sachs, Lloyd Blankfein, Vampire Squid

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Who Would Want to Be at Goldman Sachs?

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