tag:blogger.com,1999:blog-1194375569044391746.post1782319310772368640..comments2024-03-29T02:00:55.623-04:00Comments on Corporate Justice Blog: More Goldman Sachs DramaSteven Ramirezhttp://www.blogger.com/profile/16741346526253732489noreply@blogger.comBlogger5125tag:blogger.com,1999:blog-1194375569044391746.post-80522177678205343782012-03-19T19:12:29.472-04:002012-03-19T19:12:29.472-04:00Having worked in the securities industry in 2008-2...Having worked in the securities industry in 2008-2010, I experienced first hand the fall out of what I think was a perfect storm of corruption that came to an ugly head at the expense of innocent shareholders. It is so disgusting to me that to this day, Goldman Sachs wants to pretend like they did nothing wrong. When reality, the substantial profits they made in 2007 from betting on the fall out of sub-prime market helped lead to the entire crash of the market in 2008. I am not saying that they are the totality of the problem, of course, but their conduct was not ok then and it is not ok now. When profits come before the good of the shareholder, companies should be held accountable. Instead of blaming a "disgruntled" employee, provide the public for some explanation of why year after year, the shareholder is last in line. I think that this action by Goldman Sachs is just another indication that they haven't learned anything since 2008. And unless they are willing to step up to the plate and show the changes they have made in the company rather than throwing some stupid approval ratings at the papers, the problems will continue to mount.BFurrnoreply@blogger.comtag:blogger.com,1999:blog-1194375569044391746.post-63035294381046551362012-03-19T11:26:21.678-04:002012-03-19T11:26:21.678-04:00By acknowledging some of Goldman's policies we...By acknowledging some of Goldman's policies were in fact wrong, they would have given Smith's words credibility. However, the Goldman cover-up should not be the issue of this debate. What should be at issue is the fact this is not the first time Goldman employees have been caught purposely deceiving clients and their inability to correct the problem from previous accusations. The Senate Governmental Affairs hearing on April 27, 2011 was a very public display of how Goldman sells their clients "shitty deals" to make their quarterly reports seem more profitable. (see here: http://www.youtube.com/watch?v=gLx2Xc1EXLg). A public defection of a top executive citing designed deception of clients will probably send shockwaves across the institution for a while but will not effect them in the long run (again, this is not something new). This just reinforces how much power institutions like Goldman have over our economy and the inability or unwillingness of the political world to push back.BLongnoreply@blogger.comtag:blogger.com,1999:blog-1194375569044391746.post-45301699299327644932012-03-16T13:51:22.618-04:002012-03-16T13:51:22.618-04:00Although it seems unclear whether the culture of G...Although it seems unclear whether the culture of GS is adequately portrayed by Smith or GS executives, I think that GS may not have taken the best approach in its damage control following the NYT piece. After reading the NYT piece, it seems to me that Smith was in a particularly good position to assess the culture of GS. I think that the GS response was a little under-thought. The focus of the response was labeling Smith as a disgruntled employee and mentioning the "exceptional service" feedback from clients (who I would argue would likely base such an assessment on the fact that GS made them the money they wanted). I think this only shows that GS does not think there is any problem whatsoever, which I do not find too reassuring. It may have been in GS's best interest to note these possibilities and then go one step more by acknowledging that some people may not appropriately represent the values of GS (at least the values as perceived by those at the top). GS could have then reassured the public that it would better seek to ensure that the entirety of GS comforted with the culture it wanted to have and that it would remedy any shortcomings, as charged by Smith, if present. I think such a response would have went a lot farther than ignoring what may be a legitimate problem and attacking a "disgruntled" employee.Dallasnoreply@blogger.comtag:blogger.com,1999:blog-1194375569044391746.post-40938909493166488732012-03-16T10:57:06.902-04:002012-03-16T10:57:06.902-04:00Perhaps the reason the numbers recovered so quickl...Perhaps the reason the numbers recovered so quickly is the damage control that Goldman Sachs has done (see link above in blog post) and the support that other companies such as Morgan Stanley have shown (see, e.g., http://blogs.wsj.com/deals/2012/03/16/james-gorman-doesnt-think-greg-smith-op-ed-was-fair/?mod=wsj_share_twitter). James Gorman, Morgan Stanley CEO, said he doesn't think that picking one employee to write such a letter as Mr. Smith did is unfair. Goldman Sachs did a fairly good job of painting Greg Smith as a disgruntled employee. In a situation like this, it's hard to know who to believe.AMoorenoreply@blogger.comtag:blogger.com,1999:blog-1194375569044391746.post-52075767725755650342012-03-15T22:05:57.203-04:002012-03-15T22:05:57.203-04:00Mr. Smith's comments seem to have had an effec...Mr. Smith's comments seem to have had an effect on GS stock: on the day of his comments the stock plummeted a total of $4.00. This would be a considerable loss for most companies but GS sits at $123.06 at the time of this comment and the temporary drop did not put much of a dent in the stock value. In addition, the loss has almost been completely recovered already. It is interesting to extrapolate from the stock's movement how the shareholders may feel about Mr. Smith's insight on the company's culture .JGevasnoreply@blogger.com