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Goldman Sachs Exec Quits In A Scathing NYT Op-Ed About How The Firm Abuses Its Clients
Business Insider ^ | 03/14/2012 | Joe Weisenthal

Posted on 03/14/2012 6:52:39 AM PDT by SeekAndFind

jerry-mcguire

YouTubeWell this seems sure to be the buzzy Wall Street story of the day.

It's also sure to be another PR nightmare for Goldman Sachs.

Greg Smith, a Goldman Sachs executive director and head of the firm’s United States equity derivatives business in Europe, the Middle East and Africa, has announced he's quitting the firm in a most public manner: He did so by writing a long NYT op-ed denouncing what the firm has become.

After nearly 12 years, he says, the place is as "toxic and destructive" as he's ever seen it.

He slams the culture under Lloyd Blankfein, saying that the firm puts making money over clients, and that he can no longer in good conscience stay there and recruit people.

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.

He says he was once proud of working for Goldman, but not now...

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.

What really galls him is the extent to which the sole focus is making money off clients, rather than servicing them:

(Excerpt) Read more at businessinsider.com ...


TOPICS: Business/Economy; Society
KEYWORDS: businessinsider; goldmansachs; marketinsider; money; occupy; zerohedge

1 posted on 03/14/2012 6:52:43 AM PDT by SeekAndFind
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To: SeekAndFind

An Intern talks about what it was like working for Greg Smith at Goldman Sachs...

EXCERPT:
________________________________

“I worked for GS both as an intern in 06 and as a full time analyst from July 07 to March 09. I was in the NY office until March 08 and then I was in HK for a year. I interacted with Greg mainly during my 06 summer and from 07 to March 08, when I was physically in the NY office. Greg was the Stanford “Equities Captain”, i.e., he was a mentor for the incoming Stanford grads in the Equities department of the Sales & Trading (Securities) division of the firm. I hold him in very high regard - he took care of us junior guys, gave us great pieces of advice, and in general came across as one of the more personable, friendly, and genuine guys on the floor.”

Read more: http://www.businessinsider.com/former-goldman-intern-this-is-what-it-was-like-working-under-greg-smith-2012-3#ixzz1p6CvJVd6


2 posted on 03/14/2012 6:54:23 AM PDT by SeekAndFind (question)
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To: SeekAndFind

Kiss-and-tell alert. Like that celebrated dope Michael Lewis, who “abandoned” Wall St, but only after getting his share and marrying a GS banker to boot.


3 posted on 03/14/2012 6:57:06 AM PDT by the invisib1e hand (If knowledge puffs up, information positively deludes.)
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To: All
THE G/S CHRONICLES

G/S insiders all go on to bigger and better things (/snix).

Take G/S head Jon Corzine---he went on to buy two elected offices for some $125 million---Corzine was a US Senator and NJ governor. When Corzio was tossed out as Gov, he and several G/S cronies went to MF Global and looted that company of some $1.2 billion.

<><> Corzine is a well-rounded G/S operator. As Governor, he left the state of NJ $8 billion in debt. $8 billion went missing from the bogus "schools construction" agency....other agencies like UI and the Transporation Trust Fund went bankrupt with no explanation why. The $82 Billion state pension fund lost about 25%.

<><> OBAMA-CORZINE CONNECTION Right before Corzio’s reelection, Obama sent $17.5 Billion stimulus to NJ-—which promptly vanished. VP Biden is on record as having asked Corzine for financial advice----Biden has a son and a brother involved with the Stanford offshore fraud (Stanford was just convicted of running a Ponzi)

<><> MF Global principal Brad Abelow was Corzine’s appointee as NJ Treasury Secy——controlling ALL NJ assets. Gov and Secy started an investment business——but the two “financial geniuses” said they did not know this was illegal.

<><> MF Global principal Chris Flowers handled Sen/Gov Corzine’s “blind assets.” Flowers led the takeover of a Japanerse bank for Sen Corzine——Sen Corzine passed a bill giving the bank a US tax break......

<><> Jonny said "he did not know" the Senate bill benefitted him. Insider trading on Capitol hill could also be involved---Congress-rigged to get the Corzine bill passed.

<><> Corzine registered three corporations in super-secret financial haven——Delaware——BEFORE buying public offices.

<><>Bradley Abelow, an MBA from Yale School of Management, served as chief of Staff to the Governor of New Jersey in the Cabinet of Gov. Jon Corzine.

<><>Corzine first appointed Abelow Secy of the Treasury. Abelow and Corzine were top executives at Goldman Sachs. Abelow was MF Global Chief Operating Officer; Corzine was MF's CEO.

<><> G/S crony Chris Flowers controlled Corzine's "blind trust" while Corzine was in public office.

<><><><> Corzio, Flowers and Abelow are all G/S cronies.

4 posted on 03/14/2012 7:13:38 AM PDT by Liz
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To: SeekAndFind

It’s interesting GS has gone down the toilet in terms of looking out for clients since it went public in 1999. When the executives have no real long term skin in the game, before when GS was a partnership the suits had to put their own money in the company, the treat clients like dirt since they only care about cashing out on their stock options ASAP.


5 posted on 03/14/2012 7:16:49 AM PDT by C19fan
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To: CutePuppy; ken5050; Condor51; stephenjohnbanker
G/S CHRONICLES

TRUE STORY I was in an electronics store buying equipment----the clerk apologized--said he just got the job and was not too helpful.

I asked where he worked last----he said "Goldman Sachs." I musta looked shocked. He said he was not a G/S banker---worked in the computer division.

They got rid of him about a year ago----when the feds made a big show of "investigating" G/S.

My guess is this guy knew too much about their EFT's.

6 posted on 03/14/2012 7:22:53 AM PDT by Liz
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To: Liz

This very public exit has gone arcoss the Atlantic.

See here:

http://blogs.telegraph.co.uk/news/iainmartin1/100143811/a-devastating-knee-in-the-nuts-for-goldman-sachs-by-a-resigning-senior-executive/

TITLE: A knee in the nuts that means serious trouble for Goldman Sachs


7 posted on 03/14/2012 7:27:48 AM PDT by SeekAndFind (question)
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To: C19fan

Meanwhile, in other news :

FROM THE WALL STREET JOURNAL

U.S. Sues Three Firms, Fines Goldman Unit Over Customer Funds

http://online.wsj.com/article/SB10001424052702304450004577279721489229292.html

EXCERPT:

U.S. regulators sued three firms and fined a unit of Goldman Sachs Group Inc. over alleged missteps in the oversight and handling of customer accounts, an issue that has been the subject of intense scrutiny since the collapse of MF Global Holdings Ltd. last fall.

The cases appear to be the strongest signal yet that the Commodity Futures Trading Commission is taking more-vigilant steps to guard customer funds. The agency has been criticized in several quarters for lack of supervision ahead of MF Global’s collapse in October.


8 posted on 03/14/2012 7:29:18 AM PDT by SeekAndFind (question)
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To: SeekAndFind

sorry to burst some bubbles - seems all the window-lickers at Zero Hedge, Business Insider and elsewhere believe Greg Smith to be some sort of “executive”...

What a laugh. This guy was one out of a few thousand VP’s in charge of nothing special.

Now that he publically threw a tantrum for not getting the job he wanted, he’s all but unhireable on Wall St or anywhere else.

He could join an MSNBC panel show since he meets the lack of credibility requirements.


9 posted on 03/14/2012 8:01:05 AM PDT by hkusp40
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To: hkusp40

In short, you’re saying that Greg Smith is lying and Goldman Sachs is really looking out after its clients after all??


10 posted on 03/14/2012 8:16:42 AM PDT by SeekAndFind (question)
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To: Liz

Smart move : )


11 posted on 03/14/2012 8:27:04 AM PDT by stephenjohnbanker (God, family, country, mom, apple pie, the girl next door and a Ford F250 to pull my boat.)
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To: Liz

Can’t find 7.5 BILLION?


12 posted on 03/14/2012 8:32:25 AM PDT by stephenjohnbanker (God, family, country, mom, apple pie, the girl next door and a Ford F250 to pull my boat.)
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To: SeekAndFind

Greg Smith is lying. He was not an executive. He was one of thousands of VP’s. He was responsible for non-risk and non-client functions like appearing in the recruiting video and acting as a mentor or an intern liaison.

He was the head of dept that employed one person. He got stepped-over and is very bitter about it.

“Goldman Clients” is a term that covers a broad array products and support. the majority of GS clients know who reps them and know the product they are getting. I would suggest that all GS clients are covered or solicited by at least 2 or more GS competitors.

As a GS Client I can say that I know my product and my salesman as well as the type of service I expect from GS as well as their competitors.

In my business - I see hundreds of Greg Smith’s cry the blues when they get stepped-over by another person just like them. These are the breaks.

If you can’t take the heat, stay out of the kitchen.


13 posted on 03/14/2012 8:53:02 AM PDT by hkusp40
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To: hkusp40

RE: He was the head of dept that employed one person

According to the Telegraph:

http://blogs.telegraph.co.uk/news/iainmartin1/100143811/a-devastating-knee-in-the-nuts-for-goldman-sachs-by-a-resigning-senior-executive/

________________________

Greg Smith, a Goldman Sachs executive director and head of the firm’s United States equity derivatives business in Europe, the Middle East and Africa.

_________________________

I find it incredible that such a department would employ only one person.


14 posted on 03/14/2012 8:59:31 AM PDT by SeekAndFind (question)
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To: hkusp40

Goldman Sachs just fought back and called Greg Smith: “An Insignificant Peon With No Responsibilities”

So, what can I take from this?

A. Vice-Presidents are like flies at Goldman.

B. He is a peon who is the only employee in the derivatives business that he heads but that same division which spans Europe, the Middle East, and Africa.

The takeaway: Peons who are given the title of VP trade derivatives basically by themselves with little oversight. That pretty much explains everything.

Goldman has lots of business lines with only one guy on a desk........ covering all of EMEA !!

And of course, the honorable Senator/Governor Jon Corzine of MF Global fame used to be the CEO of Goldman Sachs...

Who would want to trust his money on such an operation?


15 posted on 03/14/2012 9:09:21 AM PDT by SeekAndFind (question)
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To: SeekAndFind

You can believe what you want - I asked my friends on both sides of the business at GS and other firms - Greg’s a nobody.

http://blogs.wsj.com/deals/2012/03/14/goldman-rejects-claims-made-by-disgruntled-executive/

The telegraph needs to fact check.

A person familiar with the matter said Mr. Smith’s role is actually vice president, a relatively junior position held by thousands of Goldman employees around the world. And Mr. Smith is the only employee in the derivatives business that he heads, this person said.

Greg Smith is the Chico Escuela of Wall St!


16 posted on 03/14/2012 9:12:52 AM PDT by hkusp40
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To: hkusp40

First of all, a VP claims to be an executive director: well, there you go, an indication of what type of people GS hires, how they self-inflate themselves, and how the culture probably warped this guy over time.

Then there was his weird self-promotion at the end, as though we needed it: another example of the weird self-inflation these egoistic guys are prone to do, and what the culture spawns. Finally, what’s up with an open letter to the NYT in the first place on his quitting day? He was angry and focused on himself - typical GS employee.

Then there was the Goldman Sachs response. They belittle their VPs!! VPs, though there are a lot of them, carry a lot of responsibility in terms of client relationships, selling, and underwriting. (You may agree or disagree that it’s a lot of responsibility... but GS gives them a lot of flexibility in the way they operate.)

Furthermore, rather than focusing on the general perceptions that the public has of them, GS throws this guy under the bus. Very mafioso.

To suggest he was a “peon” simply underscores the thinking at Goldman. Are “little people”, as Leona Helmsley referred to staff, any less qualified as observers after a decade on the job?

Who knows why this guy blew the whistle - maybe he was passed over for promotion, or maybe someone really pissed him off - but who cares? It’s an enlightening message. And the whole interchange highlights what is wrong with the place in broad daylight. I don’t believe that all bankers are “evil” or whatever, but GS is a real mess in any case.

All I can say is this -— Greg Smith clearly struck a nerve. Otherwise the C-Suite wouldn’t be wasting their time justifying the Op-Ed with a PUBLIC response.

Truth hurts...


17 posted on 03/14/2012 9:18:28 AM PDT by SeekAndFind (question)
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To: SeekAndFind

LOL!
“So, what can I take from this?

A. Vice-Presidents are like flies at Goldman.

YES - until you make Managing Director you ain’t squat!

B. He is a peon who is the only employee in the derivatives business that he heads but that same division which spans Europe, the Middle East, and Africa.

He wasn’t the only employee in the derivs desk! - he was a liaison for a desk associated with the global derivs desk -

ROTFLMAO!

He was not in charge of EMEA or EAFE or any acronym you want to throw out there!

“The takeaway: Peons who are given the title of VP trade derivatives basically by themselves with little oversight. That pretty much explains everything.”

No - you manufactured that little part - he wasn’t involved in any trading - in fact they relegated him to the liaison desk which is pretty much a demotion to a desk with no client or risk application!!

Goldman has lots of business lines with only one guy on a desk........ covering all of EMEA !!

You don’t get it - LOL!


18 posted on 03/14/2012 9:21:46 AM PDT by hkusp40
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To: SeekAndFind

“First of all, a VP claims to be an executive director: well, there you go, an indication of what type of people GS hires, “

or fires for that matter.... lol!

I tried to read the rest of your schpiel, but it was unbearable and reminded me too much of OWS....

here’s your capper:

“Greg Smith clearly struck a nerve”...

More like a funny bone!!!

ROTFLMAO!!


19 posted on 03/14/2012 9:26:14 AM PDT by hkusp40
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To: hkusp40

RE: or fires for that matter.... lol!

Was he fired or did he quit?

RE: I tried to read the rest of your schpiel, but it was unbearable and reminded me too much of OWS....

Excuse me, where in my post did I ask for a freebie from tax payers or demand that someone give me a job without vetting my qualifications first?

You seem to think that ALL businesses from top to bottom are as pure as the driven snow or HONEST in their dealings WITH NO GOVERNMENT ATTACHMENTS for that matter.


20 posted on 03/14/2012 9:32:41 AM PDT by SeekAndFind (question)
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To: hkusp40

RE: More like a funny bone!!!

I don’t see Goldman Sachs laughing.


21 posted on 03/14/2012 9:33:33 AM PDT by SeekAndFind (question)
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To: SeekAndFind

“I don’t see Goldman Sachs laughing.”

You ought to call them - my firends in D-1 are laughing their arses off!


22 posted on 03/14/2012 10:02:56 AM PDT by hkusp40
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To: SeekAndFind
Goldman Sachs are corporatist crooks, and have neatly installed their people into the White House. First, Paulson, then Geitner. It was these people who defrauded millions with credit default swaps. A truly evil corporate entity.
23 posted on 03/14/2012 2:12:20 PM PDT by Sam Gamgee (May God have mercy upon my enemies, because I won't. - Patton)
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To: hkusp40

There needs to be a culture change on Wall Street. The Left and Internationalists has totally cleansed the ethics out of business. I think this guy is telling the truth and if that keeps him from getting a job on Wall Street, who cares. Who wants to live like an amoral animal for money?


24 posted on 03/14/2012 8:10:17 PM PDT by SaraJohnson
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To: SaraJohnson

Nice politispeak “culture change”

People that never worked on Wall St always think they know the best remedy... LOL!

puh-leese...

Deregulate wall st make it the cash cow it was during the 1990’s.

You can thank Arthur Levitt for killing the golden-goose BTW...


25 posted on 03/15/2012 5:31:56 AM PDT by hkusp40
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To: SaraJohnson; Sam Gamgee
There needs to be a culture change on Wall Street. The Left and Internationalists has totally cleansed the ethics out of business. . . .

You are describing the success of cultural Marxism.

Global Communism
26 posted on 03/15/2012 5:57:49 AM PDT by khelus
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