Goldman Sachs and Their Puppets
Published in Les Echos
(France) on 16 March 2012
by François Vidal (link to original)
(France) on 16 March 2012
by François Vidal (link to original)
Translated from
by Allison Petit.
Edited by Gillian Palmer.
The fortress walls are cracking. On Wednesday, a banker from Goldman Sachs broke the law of silence that had prevailed within the most prestigious and the most impenetrable firm on Wall Street. Of course, as was quickly pointed out by CEO Lloyd Blankfein, in a memo sent to his troops, in a company of 30,000 people, there are always unhappy people. It’s unavoidable.
All the same, the testimony of Greg Smith, a resigning derivatives trader, changes everything — because his revelations hit where it hurts. They validate the general feelings towards Goldman Sachs. By publicly stating that the corporate culture is toxic and destructive and that the establishment often put its own interest above that of its clients, this voice from the inside lends weight to the widespread idea that the bank has lost its soul. To make matters worse, the financial crisis didn’t change anything. In spite of numerous investigations over the past few years of possible conflicts of interests within the bank, the drift continues.
What was definitively described as the pure Goldman product is the transition from an entrepreneurial culture founded on cultivating excellence toward a model based on, above all, collecting a profit at any price. It’s as if by abandoning the status of lead partners’ own ties before being publicly traded on the stock market, they have abandoned all self-restraint in their pursuit of profitability.
The revelations are obviously not of legal value. They do, on the other hand, weigh heavily on the symbolic point of view in the moral judgment that is made by the bank and its leaders. It’s another stone in the garden of Goldman Sachs while its profits erode and its business model, like that of all of world finance, must be revisited. In such a context, the last thing the bank needs is a revolt of its clients — the “puppets,” as they are nicknamed by some within the firm, according to Greg Smith. That’s why there is hardly any doubt that proof of good conduct will be given to calm the condemnation. But the walls of the fortress are far from falling.
All the same, the testimony of Greg Smith, a resigning derivatives trader, changes everything — because his revelations hit where it hurts. They validate the general feelings towards Goldman Sachs. By publicly stating that the corporate culture is toxic and destructive and that the establishment often put its own interest above that of its clients, this voice from the inside lends weight to the widespread idea that the bank has lost its soul. To make matters worse, the financial crisis didn’t change anything. In spite of numerous investigations over the past few years of possible conflicts of interests within the bank, the drift continues.
What was definitively described as the pure Goldman product is the transition from an entrepreneurial culture founded on cultivating excellence toward a model based on, above all, collecting a profit at any price. It’s as if by abandoning the status of lead partners’ own ties before being publicly traded on the stock market, they have abandoned all self-restraint in their pursuit of profitability.
The revelations are obviously not of legal value. They do, on the other hand, weigh heavily on the symbolic point of view in the moral judgment that is made by the bank and its leaders. It’s another stone in the garden of Goldman Sachs while its profits erode and its business model, like that of all of world finance, must be revisited. In such a context, the last thing the bank needs is a revolt of its clients — the “puppets,” as they are nicknamed by some within the firm, according to Greg Smith. That’s why there is hardly any doubt that proof of good conduct will be given to calm the condemnation. But the walls of the fortress are far from falling.