Close

Results 1 to 6 of 6
  1. #1
    Join Date
    Apr 2011
    Location
    Los Angeles
    Posts
    3,230
    Rep Points
    502.1
    Mentioned
    57 Post(s)
    Rep Power
    6


    2 out of 2 members liked this post. Reputation: Yes | No

    Goldman Sachs Op-Ed NY Times Article

    I used to own a bond trading company and one of our largest single equity investors was Goldman Sachs. I can tell you from first hand experience that this guy is spot on when it comes to the culture that exits at Goldman. In my dealings with upper management and their traders on a daily basis I was amazed at the lack of attention they gave their customers. Considering this guy was only 33, it makes him even more gutsy for speaking his mind and I applaud him for it.

    __________________________________________________ __________________________________________________ _______________________________________






    http://www.nytimes.com/2012/03/14/op...man-sachs.html



    Op-Ed Contributor


    Why I Am Leaving Goldman Sachs

    By GREG SMITH

    Published: March 14, 2012





    TODAY is my last day at Goldman Sachs. After almost 12 years at the firm — first as a summer intern while at Stanford, then in New York for 10 years, and now in London — I believe I have worked here long enough to understand the trajectory of its culture, its people and its identity. And I can honestly say that the environment now is as toxic and destructive as I have ever seen it.



    To put the problem in the simplest terms, the interests of the client continue to be sidelined in the way the firm operates and thinks about making money. Goldman Sachs is one of the world’s largest and most important investment banks and it is too integral to global finance to continue to act this way. The firm has veered so far from the place I joined right out of college that I can no longer in good conscience say that I identify with what it stands for.

    It might sound surprising to a skeptical public, but culture was always a vital part of Goldman Sachs’s success. It revolved around teamwork, integrity, a spirit of humility, and always doing right by our clients. The culture was the secret sauce that made this place great and allowed us to earn our clients’ trust for 143 years. It wasn’t just about making money; this alone will not sustain a firm for so long. It had something to do with pride and belief in the organization. I am sad to say that I look around today and see virtually no trace of the culture that made me love working for this firm for many years. I no longer have the pride, or the belief.

    But this was not always the case. For more than a decade I recruited and mentored candidates through our grueling interview process. I was selected as one of 10 people (out of a firm of more than 30,000) to appear on our recruiting video, which is played on every college campus we visit around the world. In 2006 I managed the summer intern program in sales and trading in New York for the 80 college students who made the cut, out of the thousands who applied.

    I knew it was time to leave when I realized I could no longer look students in the eye and tell them what a great place this was to work.
    When the history books are written about Goldman Sachs, they may reflect that the current chief executive officer, Lloyd C. Blankfein, and the president, Gary D. Cohn, lost hold of the firm’s culture on their watch. I truly believe that this decline in the firm’s moral fiber represents the single most serious threat to its long-run survival.

    Over the course of my career I have had the privilege of advising two of the largest hedge funds on the planet, five of the largest asset managers in the United States, and three of the most prominent sovereign wealth funds in the Middle East and Asia. My clients have a total asset base of more than a trillion dollars. I have always taken a lot of pride in advising my clients to do what I believe is right for them, even if it means less money for the firm. This view is becoming increasingly unpopular at Goldman Sachs. Another sign that it was time to leave.

    How did we get here? The firm changed the way it thought about leadership. Leadership used to be about ideas, setting an example and doing the right thing. Today, if you make enough money for the firm (and are not currently an ax murderer) you will be promoted into a position of influence.
    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.

    Today, many of these leaders display a Goldman Sachs culture quotient of exactly zero percent. I attend derivatives sales meetings where not one single minute is spent asking questions about how we can help clients. It’s purely about how we can make the most possible money off of them. If you were an alien from Mars and sat in on one of these meetings, you would believe that a client’s success or progress was not part of the thought process at all.

    It makes me ill how callously people talk about ripping their clients off. Over the last 12 months I have seen five different managing directors refer to their own clients as “muppets,” sometimes over internal e-mail. Even after the S.E.C., Fabulous Fab, Abacus, God’s work, Carl Levin, Vampire Squids? No humility? I mean, come on. Integrity? It is eroding. I don’t know of any illegal behavior, but will people push the envelope and pitch lucrative and complicated products to clients even if they are not the simplest investments or the ones most directly aligned with the client’s goals? Absolutely. Every day, in fact.

    It astounds me how little senior management gets a basic truth: If clients don’t trust you they will eventually stop doing business with you. It doesn’t matter how smart you are.

    These days, the most common question I get from junior analysts about derivatives is, “How much money did we make off the client?” It bothers me every time I hear it, because it is a clear reflection of what they are observing from their leaders about the way they should behave. Now project 10 years into the future: You don’t have to be a rocket scientist to figure out that the junior analyst sitting quietly in the corner of the room hearing about “muppets,” “ripping eyeballs out” and “getting paid” doesn’t exactly turn into a model citizen.

    When I was a first-year analyst I didn’t know where the bathroom was, or how to tie my shoelaces. I was taught to be concerned with learning the ropes, finding out what a derivative was, understanding finance, getting to know our clients and what motivated them, learning how they defined success and what we could do to help them get there.

    My proudest moments in life — getting a full scholarship to go from South Africa to Stanford University, being selected as a Rhodes Scholar national finalist, winning a bronze medal for table tennis at the Maccabiah Games in Israel, known as the Jewish Olympics — have all come through hard work, with no shortcuts. Goldman Sachs today has become too much about shortcuts and not enough about achievement. It just doesn’t feel right to me anymore.

    I hope this can be a wake-up call to the board of directors. Make the client the focal point of your business again. Without clients you will not make money. In fact, you will not exist. Weed out the morally bankrupt people, no matter how much money they make for the firm. And get the culture right again, so people want to work here for the right reasons. People who care only about making money will not sustain this firm — or the trust of its clients — for very much longer.

  2. #2
    Join Date
    Jan 2010
    Location
    SoCal
    Posts
    117,102
    Rep Points
    31,291.9
    Mentioned
    2055 Post(s)
    Rep Power
    313


    Reputation: Yes | No
    Apparently a lot of people are pissed about one of theirs writing this.
    Stage 2 or 2.5 E9X M3 S65 V8 supercharger kit for sale: http://www.boostaddict.com/showthrea...r-kit-for-sale

  3. #3
    Join Date
    Feb 2011
    Posts
    135
    Rep Points
    382.2
    Mentioned
    1 Post(s)
    Rep Power
    4


    Reputation: Yes | No
    Click here to enlarge Originally Posted by Sticky Click here to enlarge
    Apparently a lot of people are pissed about one of theirs writing this.
    Sticky, what's going to be really interesting is what is the proportion of pissed people to the people who are happy that he wrote it. The university I attended was one of GS's main hunting grounds and I can tell you that when your religion becomes money, there's absolutely nothing one will do not to attain it. . .
    Click here to enlarge
    Show: VOSSEN CV3's, CF front lip, trunk spoiler, EuroTeck diffuser, DCT steering wheel, 20% tint, painted grill, ELM (by Marcus)
    Go: Kleemann headers, Kleemann 168 pulley, custom OE tune, CF intake tubes, K&N filters, Eurocharged HE = 11.26 @ 123.7


    http://www.youtube.com/watch?v=lc5ruiEgZRQ


    Have you ever noticed. . .
    anyone going slower than you is an idiot. . .
    and anyone going faster is a maniac?
    George Carlin

  4. #4
    Join Date
    Jan 2011
    Location
    Pretty sure I am in Mexico
    Posts
    918
    Rep Points
    930.0
    Mentioned
    3 Post(s)
    Rep Power
    10


    Reputation: Yes | No
    Wow....good on him. Where is he going now I wonder? I'll move my money there.
    Never thought I would see the day...
    Click here to enlarge Originally Posted by Terry@BMS Click here to enlarge
    Life is so much more fun with a nemesis. I miss Shiv. Click here to enlarge
    Click here to enlarge

  5. #5
    Join Date
    Apr 2010
    Posts
    4,608
    Rep Points
    3,236.6
    Mentioned
    24 Post(s)
    Rep Power
    33


    Reputation: Yes | No
    Hes got balls to write that, watch him die of a heart attack mysteriously, next week.
    Some people live long, meaningful lives.

    Other people eat shit and die.

    I'm not racist, I hate everybody equally; especially fat people.


    Click here to enlarge

  6. #6
    Join Date
    Jan 2010
    Location
    SoCal
    Posts
    117,102
    Rep Points
    31,291.9
    Mentioned
    2055 Post(s)
    Rep Power
    313


    Reputation: Yes | No
    Click here to enlarge Originally Posted by motorkas Click here to enlarge
    Sticky, what's going to be really interesting is what is the proportion of pissed people to the people who are happy that he wrote it. The university I attended was one of GS's main hunting grounds and I can tell you that when your religion becomes money, there's absolutely nothing one will do not to attain it. . .
    I suppose that is true. I want money just haven't dedicated my life to getting it. However, maybe to get how much of it I want I will need to.
    Stage 2 or 2.5 E9X M3 S65 V8 supercharger kit for sale: http://www.boostaddict.com/showthrea...r-kit-for-sale

Tags for this Thread

Bookmarks

Posting Permissions

  • You may not post new threads
  • You may post replies
  • You may not post attachments
  • You may not edit your posts
  •