Ruemmler announced she’s resigning from her role as Chief Legal Officer and General Counsel of Goldman Sachs, effective June 30, 2026, following renewed scrutiny over her extensive communications with Jeffrey Epstein.

“Since I joined Goldman Sachs six years ago, it has been my privilege to help oversee the firm’s legal, reputational, and regulatory matters; to enhance our strong risk management processes; and to ensure that we live by our core value of integrity in everything we do,” Ruemmler said in a statement. “My responsibility is to put Goldman Sachs’ interests first. Earlier today, I regretfully informed David Solomon of my intention to step down as Chief Legal Officer and General Counsel of Goldman Sachs as of June 30, 2026.”

…Yeah Goldman’s “core value of integrity” was about stretched to its limits to accommodate thousands of emails with one of the most notorious criminals of our time. And the communications went far beyond a routine professional relationship. Career coaching. Gift exchanges. Cringe-inducing jokes that land even worse in hindsight. And all of it unfolding while Ruemmler later occupied one of the most powerful roles in corporate America.

Ruemmler’s statement frames her resignation as an act of loyalty to the institution… but let’s not kid ourselves. This was the inevitable conclusion of a situation that became untenable the moment the public was allowed to read the receipts.

Goldman, for its part, is sticking to the Greatest Hits album of corporate exits.

David Solomon, CEO of Goldman Sachs, said “Throughout her tenure, Kathy has been an extraordinary general counsel, and we are grateful for her contributions and sound advice on a wide range of consequential legal matters for the firm. As one of the most accomplished professionals in her field, Kathy has also been a mentor and friend to many of our people, and she will be missed. I accepted her resignation, and I respect her decision.”

For years, powerful people and institutions convinced themselves that silence was risk management and that distancing statements could substitute for accountability. They can’t. As more records surface and more names are dragged into the light, the Epstein fallout is only getting started.

Kathryn Rubino is a Senior Editor at Above the Law, host of The Jabot podcast, and co-host of Thinking Like A Lawyer. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter @Kathryn1 or Mastodon @Kathryn1@mastodon.social.

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.

Ruemmler isn’t some inexperienced legal rube who brushed elbows with a toxic client once upon a time. She is the top attorney at Goldman (chief legal officer and general counsel), a member of the management committee, head of the firmwide conduct committee, and co-vice chair of the reputational risk committee. Avoiding the sort of reputational damage that could arise from blurring professional and friendly relations with a toxic client isn’t just expected; it’s the whole job. Which makes emails calling Epstein “sweetie” while advising him on sexual misconduct allegations feel less like a lapse and more like a flashing red warning light.

Then there are the pricy gifts from Epstein — a $9,400 Hermès bag, a $4,200 Fendi fur-trimmed plaid wool coat, and a $1,700 Fendi bag amongst them. And she dutifully thanked her “Uncle Jeffrey” for the largesse. Now, a spokesperson said, “Ms. Ruemmler didn’t ask for anything and didn’t want anything,” which may well be true, but surely it’s obvious that the excessive gifts, and referring to Epstein as family (she also referred to him as an “older brother” in another exchange) is not exactly a master class in character evaluation.

It’s worth noting at this point that Goldman CEO David Solomon has, thus far, stood by Ruemmler, even in the face of unease at the bank.

Ruemmler herself has offered the now-familiar Epstein defense, “I was a defense attorney when I dealt with Jeffrey Epstein. I got to know him as a lawyer and that was the foundation of my relationship with him. I had no knowledge of any ongoing criminal conduct on his part, and I did not know him as the monster he has been revealed to be.” Fine. But that framing gets harder to swallow when the same communications show her venturing beyond legal advice and seeking Epstein’s career insights, joking about “trading” one of Epstein’s “Russians” for a better compensation package, and turning to him for personal guidance. These aren’t the hallmarks of a strictly professional relationship.

More emails reinforce that impression. Epstein described Ruemmler as “an arch feminist who is my great defender,” someone who could show skeptics like Melinda Gates “the other side of [J]effrey.”

Of this latest revelation, a spokesperson said, “Ms. Ruemmler had no control over how Epstein characterized her or their interactions. She was not his defender. She never advocated on his behalf with any third party — not Melinda Gates, not the press, not a court, not a government official.” That may be so. But it’s also beside the point. Epstein’s entire enterprise relied on cultivating powerful, credible people who lent him legitimacy simply by being close. You don’t have to file motions for a predator to be useful to one.

Remember, at the time of all these interactions, Epstein was already a registered sex offender! When dealing with the criminal element — especially a guy who served time for procuring a child for prostitution — it should at least cross one’s mind that you might be dealing with a manipulator. The price Ruemmler paid for all these fancy gifts was the legitimacy Epstein sought from cultivating a relationship with one of the most highly credentialed attorneys in the nation.

Grooming isn’t just about sex, it’s how predators see the whole world.

That lack of accountability is on full display in a jaw-dropping comment a Ruemmler spokesperson made. A spokesperson told the Financial Times, “It is despicable to single out and attack a highly respected female professional simply because of her benign interactions with Jeffrey Epstein.”

I’m sorry but that statement broke my brain a little bit. The thing that was actually despicable was Epstein’s criminal conduct — and the web of elite enablers that allowed it to persist for decades. You can’t wave the specter of misogyny just because there’s finally a whiff of accountability.

Brad Karp is no longer the chair of Paul Weiss! Alan Dershowitz has been repeatedly put under a microscope for his relationship with Epstein! Donald Trump’s involvement with Epstein is the top political news story in the world! No one is looking to single out a woman here. And I can assure you that if other prominent attorneys are discovered in the Epstein files, Above the Law will be writing about it (even if it’s us).

It’s galling that Ruemmler is taking this position in a vain attempt to get the heat off of her. This is the same Ruemmler who, in emails with Epstein, scoffed at diversity concerns, writing “I ain’t no affirmative action” when discussing a potential job opportunity. (Which, tbh, has big pick-me-girl energy.) Now we’re supposed to accept that it’s “despicable” to scrutinize a “highly respected female professional” for maintaining an unusually warm relationship with this guy? Equity isn’t a shield you can wield when the questions get uncomfortable.

Goldman is standing by Ruemmler for now. But the Epstein files have a way of turning “benign interactions” into something much harder to explain, especially for someone whose job is supposed to be knowing better.

Kathryn Rubino is a Senior Editor at Above the Law, host of The Jabot podcast, and co-host of Thinking Like A Lawyer. AtL tipsters are the best, so please connect with her. Feel free to email her with any tips, questions, or comments and follow her on Twitter @Kathryn1 or Mastodon @Kathryn1@mastodon.social.

For more of the latest in litigation, regulation, deals and financial services trends, sign up for Finance Docket, a partnership between Breaking Media publications Above the Law and Dealbreaker.

Regardless of anyone's feeling on sectarian violence, the shrinking of Goldman's trading operation (and partnership ranks) has been objectively effective, claiming major scalps from almost facet of the operation in a seemingly endless parade of carnage. John Waldron's megadeath routine has not slowed down though, and now Goldman is starting to see a trend in departures following the early October announcement that "Mr. Just Add Butter" himself, former co-head of trading Pablo Salome would be joining up with Citadel. And now another big name is already following him out the door:

As managing director promotions approach at Goldman Sachs, some people at the firm aren't waiting around to see who's on the list. Especially, it seems, if they work on a rates desk.

In the past month, Michael Graham, a Goldman MD and head of emerging markets rates for Asia Pacific excluding Japan, joined Citadel as a portfolio manager. 

But Goldman traders fleeing into the capricious arms of Ken Griffin is one thing [everybody in finance quits their job to work for Citadel at least once in their life], it's the secondary narrative that should give Goldman real pause:

And Nishad Potdar a rising star G10 rates and FX trader joined BlueCrest. Both were based in London.

The exits follow numerous others from the rates desk earlier this year and in 2018, with BlueCrest a particular theme. Three Goldman traders joined BlueCrest in March this year: Dan Bitel, Goldman's head of European swaps trading, left to join BlueCrest despite only being promoted to MD in 2017. Anthony Rodriguez, a macro trader at Goldman in the U.S. joined BlueCrest around the same time, and Jaymal Nathwani, a former Goldman trader, joined the fund in Switzerland. 

This year's Goldman exodus to BlueCrest follows the departure of Simon Kingsbury, Goldman's ex-head of European interest-rate swaps trading, who left in March 2018 and arrived at BlueCrest four months' later.  

BlueCrest is a big fund that has pretty phenomenal returns and manages a significant amount of money, but it's essentially a family office these days. Michael Platt stopped taking fees years ago, so a move to BlueCrest means that these Goldman traders are still confident enough to eat what they kill at a place that does 50%+ on the regular.

Basically, what Goldman is seeing right now is not just the willing departure of its Butter King, it's also seeing guys who think they're way better off finding alpha somewhere else without having to worry about butter at all. That leaves us wondering when or if DJ D-Sol and The Waldron Prince will start to care.

Goldman Sachs keeps losing top traders to hedge funds [efinancialcareers]

In fact, incoming trading head Marc Nachmann [sorry Jim Esposito and Ashok Varadhan, but we all know what's happening] would be wise to have that quote inscribed on the walls of the trading floors at 200 West Street, because the investment banker purge of once-powerful traders is clearly causing some deeply panicky behavior amongst the Bloomberg Terminal jockeys at Goldman Sachs.

Per BI:

A third Goldman Sachs banker in 18 months has been charged with insider trading. 

Bryan Cohen - a vice president in Goldman's investment banking division for consumer and retail - was accused on Friday of reaping gains from a scheme that allegedly yielded $2.6 million in illegal profits, according to court records. 

How dumb are we talking though?

The Securities and Exchange Commission said that Cohen received compensation for leaking information to an unnamed trader about upcoming takeover bids for Swiss agrochemical provider Syngenta in 2015 and Buffalo Wild Wings in 2017. 

Oh, "Buffalo Wild Wings"-level dumb? That's...instructive. It's almost like Cohen might have thought that no one would put a stock like $BWLD together with a fancy-pants trader at the Deathstar of global finance. But somehow even this wildly understaffed and rather inert SEC managed to notice it, maybe because Goldman traders have developed a habit of acting out in the throes of their fall from power:

The charges against Cohen follow two other instances of insider trading allegations against Goldman bankers in the last year and a half.

An employee was sentenced to three months in prison in June for earning illegal profits by trading on proprietary information about some of Goldman's clients.

Last year, a former Goldman analyst pleaded guilty to leaking tips about upcoming mergers to an NFL linebacker in exchange for tickets. 

But also, these instances are very very dumb. If Goldman's traders feel the human yearn to survive via cheating, they should either get better at it or just go work somewhere where they won't feel so under pressure to do well. Putting everyone around you at risk to grab an edge on the stock of a beer and wings concern is no way to go through life. Sure, it must be a nightmare to watch your colleagues pack their shit en masse on a regular basis, but mediocre equities traders are still in demand at places that rely less on performance. 

After all, hedge funds aren't totally dead yet!

A 3rd Goldman banker in 18 months has been accused of insider trading [BI]

Platform technology has revealed itself to be just as effective at losing money as human beings and tech has fundamentally uprooted trading desks around the world. Bots and algos run the show, big FiSi firms are doing CDs and no-fee trading apps for smartphones. Truly, we are through the looking glass and no one is safe.

No one:

Goldman Sachs is on track to pay its employees the lowest of any year in at least the past decade, and executives warned that the trend will continue as software consumes more of the firm’s businesses.

The bank set aside 35% of its revenue for staff compensation and benefits so far this year, the lowest since at least 2009, according to an analysis of Goldman’s data.

Put another way, the average Goldman employee earned $246,216 for the first nine months of 2019, less than half the $527,192 at the same point in 2009. That figure is calculated by dividing the bank’s compensation pool by the number of workers.

This looks like a shocking figure, but it really isn't. It's easy to close your eyes and remember when Goldman was impervious to the bad mojo of the world, but those days are over. In fact, if you look at Goldman's recent past, 200 West Street has been more rocked by the sea change than anyone.

All the leaders are new, almost all the rainmakers we knew are gone and DJ D-Sol has gone full Stalin Politburo on his partnership group. Most of the stories you see about Goldman today are about big-name departures, Marcus and the AppleCard. While some of you were sleeping, the most well-paid group of premier talent on Wall Street has become a bunch of middle-aged big timers and a ton of kids being paid way less to create the future.

But now the guys running Goldman have a big question to answer: What if their vision for the future sucks? Saving a metric shit-ton of money on salaries now will definitely give you room to breathe while getting the AppleCard going, getting a stranglehold on the terrifying new landscape for tech M&A/IPOs, and making Marcus work. If David Solomon's Goldman [a cool hip i-bank that does some light trading just to keep it swaggy] is going to work, those things all have to kick on within the next three quarters. The WeWork IPO was a painfully instructive to all the Wall Street cool dads,  DJ D-Sol included who got hit to the tune of $80 million. But what's to say that Marcus and AppleCard aren't just mini-WeWorks waiting to implode? Definitely not longtime Goldman ur-tech maven Marty Chavez who is leaving at the end of the year, or Goldman HR guru Dane Holmes, who is also now leaving at the end of the year to go run a tech company.

Goldman Sachs is still a $75 billion institution that sits astride an immense position of power in the global economy, and it has nothing but money to throw at figuring out what's next, so it's comical to think that there's a feeling of crisis anywhere in the firm. That said, it's going to be a while before things shake out and data like lower spending on salaries isn't greeted with some circumspect questioning of why Goldman Sachs isn't paying people like they work at "Goldman Sachs."

Goldman Sachs is slashing employee pay as it ramps up new tech ventures like the Apple Card [CNBC]

Per Bloomberg:

The firm took a $267 million hit in the period on public equity investments such as ride-hailing company Uber Technologies Inc., Avantor Inc. and Tradeweb Markets Inc. The bank probably took a writedown on its stake in WeWork after plans for an initial public offering collapsed. The losses fueled the worst performance in more than three years for the bank’s equity wagers in public and private companies.

Sure, Goldman only narrowly missed on EPS and even managed to nail down a narrow beat on revenue, but more than a quarter of a billion dollars would have been really helpful for Goldman to massage the edges of both those results:

Goldman’s investment bankers also logged a much bigger decline in fees than analysts had predicted, down 15% from last year’s third quarter. They delivered their worst showing in David Solomon’s tenure as chief executive officer amid choppy markets and marquee deals that had to be pulled.

See? Every dollar that Uber and WeWork and the fintech boys simply burned could have come in handy to John Waldron as he papered over the fee-related holes in the walls at 200 West St, and show investors that Goldman Sachs is a better investment bank now that pretty much only investment bankers are in charge again:

That performance was softened by an improved showing from traders amid signs of a revival in Goldman’s biggest unit. Trading revenue rose 6% from a year earlier to $3.29 billion, the New York-based bank said Tuesday in a statement. That beat the $3.17 billion average estimate of analysts in a Bloomberg survey. Earlier in the day, JPMorgan Chase & Co. reported results that beat Wall Street estimates, driven by stronger than expected revenue from its fixed-income traders.

At least someone at Goldman was driving enough profit to put some lipstick on this pig...that Goldman i-bankers are likely roasting in the backyard of their Greenpoint townhouse. The fact that the traders who survived the fall of the House of Lloyd saved the bank's ass this quarter might be the magic needed to stop the current regime from indiscriminately stabbing and throwing its Bloomberg Terminal jockeys into the river like so many Huguenots.

But if those i-bankers are throwing garden parties for their bougie Brooklyn friends who likely also got fleeced putting family office dollars into Uber and WeWork, they could at least try to sell them on some high-yield Marcus CDs while pouring a few glasses of skin contact wine.

After all, it looks like it's a team effort at Goldman again. 

Goldman’s Third Quarter Haunted by Uber, Other Investments [Bloomberg]

Robinhood is giving banking another shot.

Ten months after the failed launch of a checking and savings account, the free stock-trading start-up announced a cash management account with a 2.05% interest rate. The APY is more than twenty times higher than the national average for savings accounts, according to Bankrate.com.

In December, Robinhood said it would offer zero-fee checking and savings accounts with a 3% interest rate alongside its brokerage accounts. The move was seen as a shot across the bow of traditional banks. But the product saw swift pushback from regulators who questioned the SIPC insurance it was promising, which is meant for brokerage accounts — not for savings products. A day later, Robinhood said they would re-brand and re-name the product after the “confusion.”

Oh yes, the perils of actually having to reckon with regulation when you're holding people's money in a high-yield account. A much different animal than letting them use anonymous platform tech to turn Etheruem into shares of Tilray, isn't it? But as much as we want to continue mocking Robinhood for essentially being itself, we simply cannot overlook that Robinhood has achieved its goal of fully disrupting the online trading game. By forcing the big boys to get rid of fees, Robinhood has proven that at the very least, it's not to be ignored.

Which brings us back to the point we made last December about Robinhhood's original and hamfisted attempt to do saving accounts: It's an existential threat to Goldman Sachs and Marcus.

Our argument from ten months ago stands but with one major edit. In December 2018, we were unclear about how important Marcus was to the new regime at Goldman. In October 2019 we can state with some certainty that it's a very high priority, which sucks for DJ D-Sol and his Krazy Krew because retail banking does not come naturally to 200 West Street. In fact, retail anything is not what Goldman Sachs does best, and it seems loathe to take the obvious route and do a major multi-platform ad buy with the slogan "Why Not Give Us Your Money Voluntarily Before We Get It Anyway?" or "It's A Goldman Sachs Bank Account. You're Fucking Welcome."

If Robinhood comes even halfway close to doing what it did to the platform trading industry, Goldman needs to size it up immediately for a [little-C] cash and [big-S] stock acquisition. Robinhood has a rabid consumer base that Goldman does not reach, knows exactly how to market itself and does not make a profit, so DJ D-Sol would find it easy in this environment to lop about 30% off Robinhood's current private valuation and call it even. What Goldman does would do with the trading platform is unclear in this very simplistic vision of ours, but we are not averse to the idea of extorting Chuck Schwab to pay for shutting it down.

Essentially, we remain annoyingly impressed by the actual disruption that Robinhood has achieved so far, but its second attempt at doing adult banking on an app is nothing but a way to make fun of old dad banks trying to wear skinny jeans. Goldman Sachs is suddenly the poster child for Wall Street trying to engage with the kids, so instead of dodging Robinhood's shot across its bow, Goldman should buy the cannon now and turn it on the next logical target: The Big Four Banks.

Clarification: While we understand that Goldman will benefit from Robinhood's new cash management accounts via a rather wonderfully explained deposit sweep program [the SIPC insurance on deposits being swept bit is especially entertaining], it will be sharing in essentially non-invested excess brokerage money with five other banks, 3 of which are Goldman's major competitors on Marcus. Our argument here is that Goldman should buy the cow instead of sharing the milk for 1.9% APY.

Robinhood makes second attempt at launching a high-yield account similar to banks [CNBC]

Let's dive in, shall we?

What kind of jumps out at you first is that 54% of the interns surveyed at Goldman this summer are women, and that at least looks like statistical progress. We're also a little tickled that the future Alphas of finance are still reading "The Alchemist" and are more than likely still using the dime store capitalist mysticism contained within on first dates with first-year analysts at Credit Suisse who they really aren't all that interested in. We also like that 65% of them are still using their parents' accounts to stream some kind of video content and that 66% of them would prefer to stay in a hotel than be caught dead in some ratchet Airbnb like their roommate who is - like- an anthro major. These children are clearly aware that working at Goldman means you will only stoop so low as a Wyndham for the rest of your days.

But this result caught us by surprise because it seems as if these kids might not know one key thing about working at Goldman:

8 hours of sleep a night? Umm, you're not going to feel like yourself guys. Unless of course your plan is to wake up, drink a Soylent in the shower, work a 14 hour day and then drink another Soylent on the way home before going to bed in your clothes. This is Wall Street, you little comfort monsters! You think John Waldron sleeps 8 hours a night? He sleeps 45 minutes a day, hanging upside down like a bat!

But, hey, 8 hours a night means a warrior monk lifestyle, so maybe we're being a little harsh:

Kids say the darndest things.

And speaking of not getting it...

The last two are maybe doable...okay, the last one is definitely doable, but it's also very, very fucking dumb.

And speaking of not cool:

Aren't the youth supposed to be the progressive generation that leads us into a brave new world? Do they know that pot isn't just for helping you get 11 hours of sleep? We thought they were supposed to be...cool.

Does anyone have the Barclays intern report? Those kids must looooove weed.

2019 Goldman Sachs Intern Survey [Goldman Sachs]

But almost 10 months into retirement, Lloyd is doing this:

The socialism debate is not just about redistributing income and wealth; it's about how much of the economy gov't should monopolize. Gov't should incentivize and regulate but not displace the private sector. When it does, you get the VA for health care and NY's NYCHA for housing.

— Lloyd Blankfein (@lloydblankfein) September 16, 2019

Lloyd Blankfein needs a friend to talk to, and we'd like to remind him that we're here...and we're listening.

[and also that he should run for Mayor of New York City, but we'll come back to that.]

Martin Chavez, Goldman Sachs ’s departing coder-in-chief, is listing his townhouse in New York’s West Village for $19.95 million amid a planned move to the West Coast.

The four-story, four-bedroom property—one of a handful of townhouses built as part of the Superior Ink condominium project—has a distinctive white, highly modern look.

Well, that sounds nice. 

Altogether, the property spans about 5,150 square feet with an additional 1,525 square feet of outdoor space, according to the listing agents.

At that size and price, Marty's house could make a nice little guest house for Ken Griffin to house tagalongs when he's in the city. And there's a garage for him to keep wantaway Millenium and D.E. Shaw PMs during their lockup periods. At "less" than $20 million, that's a deal.

Actually, why is Marty letting go for so cheap?

Mr. Chavez bought the townhouse for $10.5 million in 2011, public records show.

Getting a not quite 100% return on your West Village townhouse in just under a decade? Oh, Marty Chavez, you were just too damned relatable to ever wear the Goldman Sachs crown.

Goldman’s Departing Coder-in-Chief Lists West Village Townhouse for $19.95 Million [WSJ]

Martin Chavez is retiring from Goldman Sachs Group Inc. where he was the face of a new breed of engineers ruling Wall Street and one of its most senior openly gay executives.

Mr. Chavez, who had once been considered a potential chief executive of the company and has been a co-head of its trading arm for the past 10 months, will retire at the end of the year, according to an internal memo.

Marty Chavez was "The Prince That Was Promised" at Goldman Sachs, a gay Latino who understood the future and a well-known favorite of the last king, Lloyd Blankfein, who promoted him all the way up to CFO. In fact, Marty was so key to Lloyd's reign that this isn't the first time he has retired. The last time he tried to leave Goldman, Chavez tried to hide out at a monastery in New Mexico but was pulled back into the DeathStar by the famed subtlety of Gary Cohn.

Since then, Marty has been charged with making Goldman Sachs tech-friendly. That's involved everything from being a Silicon Valley diplomat to turning Goldman's trading operations into a seamless, borderline inhuman machine.

But the halo of promise that perpetually hangs around Chavez has been nothing but threatening to the new regime of David Solomon and John Waldron. Marty is the last glowing vestige of the Blankfein days, and his usefulness in using code to cull traders has clearly been outlived. DJ D-Sol has moved swiftly to remove all threats to his sovereignty with Marty Chavez being the last and trickiest one of all. 

Solomon and Waldron have made it pretty clear to Marty that his future within 200 West Street was rather..."limited," and they're not even trying to hide the truth that they wanted Marty replaced with someone loyal to the new administration:

Mr. Chavez will be succeeded by Marc Nachmann, who is currently a London-based investment-banking executive. Mr. Nachmann came up designing derivatives for Goldman’s own traders and commodities clients and is known as a wonky insider. 

Investment bankers are the new ruling class within 200 West Street, which did not bode well for a senior exec like Marty who belonged firmly to the sect of traders and once told Gary Cohn that he didn't even know what i-bankers, like did.

What Marty does next will be the fruit of rumor for months, but we're pretty certain [without any evidence or real knowledge, obviously] that he won't be taking the big job at Wells Fargo or any other job in bulge-bracket finance. We see Marty investing in tech, sitting on boards and not doing much. But by simply being out there in the world, we like to fantasize that he remains an existential threat to the corner suites in Battery Park.

Martin Chavez, Goldman Sachs’s Coder-in-Chief, to Retire [WSJ]

The iPhone maker is venturing into the credit card business by partnering with Goldman Sachs and MasterCard. Apple is offering a cash-back credit card comparable to many other cards currently on the market. Not quite the level of innovation from the Steve Jobs era.

With profits and revenues down, Goldman Sachs is looking for new ways of “doing God’s work.” By approving subprime borrowers for the Apple Card, it's doing exactly that by offering products to people who don’t vacation in The Hamptons. 

In Goldman's defense, it was Apple who preferred a partner that would approve as many of its 100 million-plus U.S. iPhone users as possible. Apple unsuccessfully tried this in the 90's, when Steve Jobs “had an aversion” to rejecting the company's customers.  Other banks were hesitant to partner with Apple. An employee at a competitor of Goldman Sachs texted his buddy “Dude, if that portfolio ever makes money, I’m buying you a beer.” Citigroup pulled out over fears it couldn’t make an acceptable rate of return.

So what happens if you lose your Apple device? Well, you can’t pay your bill because there isn’t a web option to pay, unlike literally every other card provider. Payments can only be made through the Apple Wallet app. Of course, you can call and make a payment, but if you just lost your phone and are a subprime borrower, you likely won’t be able to afford a replacement. So for a company that was once named the most innovative company in the world for 10 consecutive years, Apple’s recent innovations include a credit card that can’t be paid online and removing the headphone jack.

It will be interesting to see if in a few years "The Big Short 2" is released, in which Goldman Sachs makes a killing on credit-default swaps on the creditworthiness of the borrowers who are more or less being forced into Apple’s credit card. After all, the “dude” at Goldman Sachs has to find some way to make money so he can get that beer.

Get more Hipster Trader at @Hipster_Trader, and sign up for his newsletter here.

The S&P 500 Index is now trading near its fair value, with limited further upside after its 19% climb so far this year, according to Goldman Sachs Group Inc.

“The path forward for index ROE is likely to be challenging, although lower interest rates and lower tax rates may provide support,” Goldman strategists including David Kostin wrote in a note to clients, referring to return on equity. Negative revisions to 2020 earnings-per-share forecasts and “policy uncertainty” will limit upside potential, they wrote.

Goldman Sachs is not optimistic on the equities market going forward, which does make sense considering it killed off all of its traders, so it's time to lower interest rates and keep this fake success rolling creakily along...wait, what?

Goldman Says Stocks Likely Won’t Go Up Much Higher [Bloomberg]

“We started out to try to create a business that would disrupt what’s a big broad industry by really focusing on our customers, on our clients in a way that we would provide better service, better solutions, deal with pain points,” Solomon told about 200 Marcus workers who gathered on the 26th floor of the firm’s New York headquarters for a meeting attended by CNBC.

“Now, we’re getting absolutely no credit from anybody else in the investing community about that yet,” Solomon said.

“If we were out in Silicon Valley and made 20% of the progress that we’ve made, we would get a lot of credit and people would be throwing money at us to own a piece of this business,” he added. “But nestled inside little old Goldman Sachs, we’re just going to have to prove it over time.”

"...Now who's coming with me?!" he finished before leading his 200 followers on a brisk sprint through the nearest wall.

But seriously, those poor retail banking folk trapped in the tower of nightmare anonymity that is Goldman Sachs. If only these poor well-paid bastards were toiling away in a Redwood City WeWork, sipping on tap cold brew and wondering when they will receive that sick funding round from Peter Thiel or that lowball acquisition offer from SoFi. Perhaps then they would feel appreciated, not stymied by the virtual invisibility that one feels working for...one of the most powerful financial services company in the global economy. This must be what those people in their Martha's Vineyard summer homes feel like when they read about Hamptons parties in The Sunday Times.

And by the way, the award Marcus won was from J.D. Power for the apparently meritorious level of customer service that Marcus provides in the personal loan process, which is what Marcus does in case you were wondering because that's something people ask a lot...about Marcus...and what it does. Did those ads not make that clear.

Goldman CEO: If Marcus was a Silicon Valley start-up, people would be ‘throwing money at us’ [CNBC]

Goldman Sachs on Monday posted first-quarter profit that beat analysts’ expectations as the bank reined in compensation, while companywide revenue missed on tougher market conditions for two of the firm’s main divisions.

The bank generated $2.25 billion of profit in the period, or $5.71 a share, compared with the $4.89 estimate, the New York-based firm said in a release. Revenue dropped 13% to $8.81 billion on lower results in the bank’s Wall Street trading and investing and lending segment, below analyst’s $8.9 billion estimate. Shares fell 1.7 percent in premarket trading.

Hmm, what? Goldman is clearly pulling in way less money these days, everyone knows it, and everyone seems pretty disappointed, yet DJ D-Sol and Co. beat on EPS by almost a dollar per share? Cool cool cool.

Considering the impact that tough trading conditions had on revenue, Goldman pulled a lever at its disposal: It lowered compensation for its employees. The bank booked $3.26 billion in pay and benefits for the quarter, 20% less than a year ago and well below the $3.58 billion estimate. The firm also trimmed headcount by 2% from the fourth quarter.

So, Goldman managed to massage earnings by paying everyone less and also putting the heads of many top traders on spikes in the entrance to 200 West Street as a warning about future incompetence. That's bold management right there, but it's not a long-term plan.

People don't go to work at Goldman Sachs to see their pay fluctuate downwards once in a while. People go to work at Goldman to get paid more than their friends regardless of what the global markets are doing. And David Solomon is still relatively new, so this is not exactly leveraging an esprit de corps situation. D-Sol and John Waldron get like two of these before they have a problem considering that "suddenly"* Morgan Stanley is an incredibly attractive place to go that is not a hedge fund or a tech startup. 

We can't help but be impressed that Goldman's new team managed to pull off a top and bottom like beat with objectively shitty revenue, but not as impressed as we are by the fact that they barely tried to hide showing their work, or that we've gone this far in a post about Goldman's bottom line with once typing the word "Malaysia."

Goldman Sachs beats analysts’ estimates for first quarter profit while markets impacted revenue [CNBC]

Thanks for the memories, @BlackBerry. While our days of physical smartphone keyboards are #TBT, we still ♥ your mobile work apps pic.twitter.com/VUWXDgJzi5

— Goldman Sachs (@GoldmanSachs) April 4, 2019

While some could see this as yet another bad sign for BlackBerry stock, we would argue that the real takeaway should be "Goldman Sachs was still using BlackBerrys?!" 

We're assuming that all new company-issued equipment will be way more capable of data storage for things like music files. Perhaps they might even come pre-loaded with this total banger.

Congrats on your new gear, Goldmen.

Welp, we now have some pretty wonderful evidence what Goldman is doing, and we are so so pleased to share it with you. Some new ads have dropped on a YouTube channel that Goldman set up for Marcus video content a while ago, and though they be short, they are breathtaking in their lack of subtlety.

Here's one:

Yeah. It's real good. That guy is dumb and fat, and regular, yet also so empowered by his Goldman Sachs high-yield savings account. In fact, this bloated moron is singing! And he can't stop!

Hahahaha, YEAH! Fuck Todd and his low-yield-fraudulent-Wells Fargo-savings-account-having ass.

And speaking of being better than people, check out this lady:

A mother just holding onto sanity at a PTA meeting, existentially resentful of the other parents with whom she shares this garbage lot in life, but so buoyed by this APY miracle granted to her by a 57-year-old EDM DJ that she can literally break free of that dank classroom, admit that she's an emotionally selfish asshole without breaking tune and then go tell her high school econ teacher to eat a dick because she's "Baaaaaaaanking with Gooooooldman SAAAACHS!" [we made up those lyrics but not the plot twist that the PTA meeting is at the school she attended because even we can't make up shit that bleak.]

Overall, these ads are well-produced, wholly batshit and not nearly as tone deaf as some of you snowflakes are going to say they are. We'll wager that if Goldman Sachs has learned anything while looking into consumer banking it's that regular people find this whole thing agonizingly complicated and confusing, so much so that they feel dumb and easily preyed upon. So why not do ads that shows American idiots feeling so empowered by their new savings account that they go the full Lin Miranda?

Of course, these ads are condescending and lame and awkward, they're meant to sell Goldman Sachs to normal people. So, with that in mind, they are also perfect.

So color us shocked by this news:

Goldman Sachs expanded a year-old program to hire more workers from underrepresented groups, including goals for black and Latino hires for the first time. 

The firm has set “aspirational goals” of having half of all new analysts and entry-level associates hired in the U.S. be women, 11 percent black, and 14 percent Latino, according to a staff memo sent Monday. The firm set a lower goal for black hires in the U.K., where it is seeking 9 percent level.

And while you might argue that these numbers are gallingly aggressive, we would argue that this is Goldman Sachs we're talking about here. Hyper-aggressively bending reality to make the data work has been a quasi-successful business model over there for a handful of decades now.

Even DJ D-Sol himself is readily admitting that it might take a while to make the analyst ranks fully boy-girl-boy-girl:

While the targets “are aspirational, we have access to an incredible talent pool and believe they can be achieved,” CEO David Solomon and two of his deputies said in the memo. “We are also exploring new ways to increase representation of the LGBT, disabled and veterans communities.” 

But what is not being addressed in the new policy is the hairless elephant in the room: Bald power. You can get to 50/50 on gender, but the glass ceiling at Goldman is harder to break with hair on your head. 

So we need to ask the question: Why haven't Alison Mass or Dina Powell shaved their head already?

Goldman Sachs says half of all the junior bankers it hires must be women [CNBC]

Goldman Sachs Group Inc. said in a filing it planned to eliminate 65 jobs from its New York operations.

The firm filed a Worker Adjustment and Retraining Notification with the New York Department of Labor describing the planned workforce reduction, which it blamed on “economic” factors. The filing was dated Feb. 27 and publicly released this week.

Ah, a rite of spring. Like the pruning of a global $70 billion tree....

The commodities business has been one target, and senior managers were asked to present a plan that included job cuts and exiting some business lines to reduce Goldman’s global footprint. The firm is eliminating 10 staffers in the commodities division, representing about five percent of the unit’s workforce, people familiar with the matter said last week.

Renewal, rebirth, and for 65 people perhaps a lot of rosé.

Goldman Sachs Says in New York Filing It's Cutting 65 Jobs [Bloomberg]

Per Bloomberg:

U.S. companies have “consistently” returned cash to shareholders for almost 140 years, so it’s far from a new development, strategists led by David Kostin wrote in a note Thursday. And buybacks don’t dominate corporate spending, they said -- growth investment has been the largest share of U.S. companies’ spending every year since at least 1990.

“One of the greatest misconceptions in the public discourse surrounding corporate buybacks is the belief that managements repurchase stock in an attempt to inflate earnings per share and meet incentive compensation targets,” Goldman wrote. “Executives whose compensation depends on EPS,” they said, “did not allocate a higher proportion of 2018 total cash spending to buybacks than companies where management pay is not linked to EPS.”

See? There's no direct data showing a connection between C-Suite greed and using tax cuts to inflate your own stock price. So fucking RELAX pinkos.

In fact, if you're smart, buybacks are good:

Growth investment “has accelerated sharply” since the tax reforms passed, contradicting “the widespread belief” that the changed policies led only to a surge in share repurchases, Goldman said. Companies have boosted buybacks relative to dividends to repatriate overseas profits and because of greater flexibility to match earnings volatility, the strategists added.

Read up, Bernie Bros, because according to the paradigm of American capitalism, you're tilting at the wrong windmill. And surely this will solve the issue, after all the entire debate over corporate buybacks is a fact-based one and not at all a symptom of our larger societal schism between a far-right embracing a completely unregulated private sector and a far-left that is openly experimenting with a new strain of American proto-socialism. Maybe Goldman is talking to the handful of people left in between who are even vaguely interested in the nuances of things like how buybacks have multiple effects on the US economy at once.

“Corporates are generally efficient allocators of capital,” Goldman wrote. “We find some evidence that the companies that are able to generate the highest returns on assets are also those that invest the most in growth capex and R&D,” while “firms that generate lower asset returns may find the economics of cash return to shareholders to be superior to investing for growth.”

Shhhh, Goldman, you're not helping.

Goldman Rips Into U.S. ‘Misconceptions’ About Share Buybacks [Bloomberg]

And yet...

Goldman Sachs Group Inc said on Tuesday that it is relaxing the dress code for all its employees, a move once considered unimaginable for the Wall Street firm’s leagues of monk-shoed partners and bankers in bespoke suits.

The new “firm wide flexible dress code” was announced in an internal memo, which said the shift was due to “the changing nature of workplaces generally in favor of a more casual environment.”

Lloyd hasn't even moved out of the guest room and you guys are already changing the rules of the house? What kind of ice cold hipster would do this?

The memo sent to the bank’s some 36,000 employees was penned by Chief Executive Officer David Solomon, a former investment banker who took the role in October, along with Chief Financial Officer Stephen Scherr and Chief Operating Officer John Waldron.

We look forward to hearing about DJ D-Sol showing up to a client meeting in a Paul Oakenfeld hoodie and Supreme trucker hat. Plus it's very exciting to think that John Rogers can finally show up to work in his preferred style of head-to-toe leather. And we are going to assume that this is all the excuse Waldron needs to finally let his freak flag fly and wear a tie with a pattern on it, so...cool!

And based on who wrote the memo, we need to ask: Do we think the new dress code apply to traders? Or should they just keep wearing hair suits?

Suits and ties now optional, Goldman Sachs hedges dress code [Reuters]

But some manage to escape that fate by standing up and being heard from the inside, a solitary voice of moral clarity ringing out against the din of madness and death.

Goldman Sachs Head of Asian Investment Banking, Kate Richdale knows what we're talking about...

KKR & Co Inc has poached Kate Richdale, Goldman Sachs Group Inc chair of Asia investment banking ex-Japan.

Richdale will be KKR’s head of strategy and business development in the Asia-Pacific region, and will also work with KKR’s Asia investing businesses to assist with deal origination, the U.S. private equity firm said on Monday.

Yes. While ritualistic cleansing of traders loyal to the Lloyd regime continues apace inside 200 West Street and beyond, Kate Richdale will not stand by and be part of it. No, attention must be paid and the truth must be heard. Kate Richdale will be part of this brutality no longer, for she is escaping to a place where goodness and light prevail against all things...Kohlberg Kravis Roberts.

Fuck. This metaphor almost worked.

KKR poaches Goldman Asia investment banking chair Richdale [Reuters]

For examples, we can point to France in the late 1700s, China in the 1960s, Central Africa in the 1990s, or 200 West Street today. With the ascension of David Solomon to the throne of Goldman Sachs, investment bankers are now back in control of the firm after a dozen years of trader rule. And like any newly-installed cabal looking to flex its power, DJ D-Sol and his right-hand man John Waldron have moved swiftly to purge traders from power positions within the firm.

And according to eFinancialCareers, they have claimed a major scalp:

Goldman insiders say that Steve Ferjentsik, who ran program trading for Goldman Sachs in the U.S., left in recent weeks.

Goldman Sachs declined to comment. Ferjentsik remains registered with Goldman Sachs according to FINRA. However, he is no longer listed on the firm's internal directory.

Ferjentsik joined Goldman Sachs in 1998 and spent his entire career working for the firm. He was promoted to partner in 2006 and is described by insiders as having run the portfolio trading desk "for years and years." It's not clear what Ferjentsik plans to do next. 

Ferjentsik joins a growing list of star traders who thrived under the Blankfein/Cohn regime but is suddenly out on the West Side Highway holding a box full of Goldman Sachs mugs and wondering what his future holds [SPOILER: Whatever he wants it to, the guy ran a major desk at Goldman Sachs for a long fucking time.]

We're not saying that Solomon and Waldron are putting heads like Ferjentsik's on spikes around the building to sew fear and panic in the hearts of once-proud traders, but we're also not not saying it.

It's unclear how long the culling of traders will last but based on history it is likely to deteriorate into sectarian skirmishes and guerilla warfare within Battery Park City that leave bloody hands and guilty souls on both sides of the struggle. 

Or maybe it will last until Goldman's traders start making money again...but let's stick with the dark persecution massacre metaphor. It's "funnier."  

UPDATE: Per Goldman Sachs, Ferjentsik was head of US Macro Sales Trading at the time of his departure, which included the program trading business. 

One of Goldman's longest-serving U.S. traders left the firm [eFinancialCareers]

Per the NYT:

The fallout for Goldman Sachs from a scandal tied to a Malaysian investment fund could mean lower pay for several senior executives at the Wall Street bank, including the chief executive, David Solomon, and his predecessor, Lloyd Blankfein.

If this whole thing turns out to be true, Goldman has a plan. According to the filing, the powers that be at 200 West Street have set aside some money to pay out fines and other legal costs, and will make a show of contrition for the future by personally punishing DJ D-Sol and some human personifications of its past...

The forfeiture and clawback provision could cover about five top current and former executives at the bank, said a person familiar with the matter but not authorized to speak publicly on board matters. The holdback on the long-term compensation plan could apply to up to three retired executives, including Mr. Blankfein, Michael Sherwood and J. Michael Evans, the person said.

Wow, that's gonna "hurt" some people. How much "back" are we "clawing" here?

The grants under the long-term compensation plan go back to 2011, around the time Goldman began underwriting bond deals for 1MDB.

Wait, 2011? And the pain is being shared by Lloyd, Sherwood and Evans? Aren't we forgetting someone?

One former executive, Gary Cohn, who left Goldman to join the Trump administration, is not affected by the decision to defer compensation because he received a lump payout when he left the bank, the person familiar with the matter said.

The Teflon Grundle skates again!

Goldman Sachs Suggests Current and Former Executives Could Lose Money Over 1MDB [NYT]

Quick recap: A scorpion asks a frog for a ride across a river, the frog hesitates because it's dealing with a scorpion, the scorpion makes promises, a deal is struck, then the scorpion stabs the frog midstream and as they drown, the frog asks "But why, bro?" and the scorpion is all "Cuz I'm a fucking scorpion."

Or if you'd like a different telling, try this:

Goldman Sachs Group Inc. put its own interests ahead of that of a corporate client in advising on a wholesale-food company acquisition last year, a new lawsuit alleges.

The suit, filed by United Natural Foods Inc., accuses Goldman of improperly extracting more than $200 million in advising the Providence, R.I., food distributor on its $3 billion acquisition of grocery chain Supervalu Inc.

Well, to be fair, in this version the scorpion survives.

At issue is a roughly $2 billion financing loan Goldman arranged for United Natural Foods on the deal. The company alleges that Goldman arranged the financing in a way that hurt United Natural Foods but benefited the financial firm and its hedge-fund clients that had placed bets in the credit-default swap market against Supervalu. The company also accuses Goldman of taking advantage of the deal’s provisions to extract more money from United Natural Foods.

Ok, the scorpion thrives...

The suit against Goldman also alleges that the firm used its control over the financing to extract more money from United Natural Foods. A person familiar with Goldman’s thinking said that structuring the financing as it did was necessary to get lenders’ participation. Under the financing provisions, Goldman could hike the loan’s interest rate by 1.25 percentage points to make it more attractive to investors.

Another provision allowed Goldman to claim an additional $40.5 million from United Natural Foods if it didn’t have a full 15 days to fund the loan and was unsuccessful in raising the money.

But at the heart of this lawsuit is a complaint that we can't help but read as "your honor, we were just trying to give a mutually advantageous ride to this scorpion..."

In the suit, United Natural Foods alleged that Goldman “consolidated its command over all aspects of the transaction, enabling it to ensure its own profits to the detriment” of United Natural Foods and its shareholders.

United Natural Foods expected Goldman “to provide ethical counsel and unbiased support“ of the deal, said Mr. Spinner, “not leverage their positions to pursue larger profits for themselves and other clients at our expense and ongoing damage.”

BRB, we're off to sue Wells Fargo for being a little cagey about how many savings accounts we have.

Goldman Feasts at Expense of Food-Company Client, Suit Claims [WSJ]

For example, Justice Department and bank regulatory officials, did you know Leissner is a bigamist? A gold-digger? Someone who bangs clients? A mail-order Ph.D.? Worst of all, a two-time convert to Islam? Or at least someone who lies about it to the DMV and rich women he’s banging? I mean, however could Goldman have detected any of those things during Leissner’s 17 year career with the bank, or during the vetting process that gave him one of the most coveted titles on Wall Street, Goldman Sachs partner?

Just one little problem….

Some Goldman executives knew about his alleged romantic relationships with clients, but the bank did not object to them until after Mr. Leissner became a target of investigations.

Five current and former Goldman bankers said in interviews that they were aware of Mr. Leissner’s hard-partying reputation and romantic overtures to wealthy women, including several who were executives at companies that were bank clients.

Joe Ravitch, a former Goldman partner who helped hire Mr. Leissner from Lehman Brothers in Hong Kong in 1999, said it was common knowledge that Mr. Leissner was misbehaving. “A lot of the people that worked for me would tell me the stories about Tim being a wild man,” he said.

In one case, Goldman investigated Mr. Leissner’s relationship with a top female executive of a Malaysian media company, but the bank ultimately didn’t take any action against Mr. Leissner, according to a Goldman official.

I think it’s safe to say there may be some additional legal reserves set aside in the future.

Goldman Sachs’s Tactic in Malaysian Fraud Case: Smear and Ex-Partner [NYT]

This note from Goldman Sachs warning of the macro threat posed by spending ennui amongst our ruling class is one of those notes. Of course the rich need to spend like pirates to keep whole sections of our economy afloat. We just like when Goldman says it...

The stock-market sell-off is going to be a significant drag on the U.S. economy this year as wealthy households feel its impact, according to Goldman Sachs Group Inc.

Lower equity prices could take half a percentage point off U.S. gross-domestic product growth in 2019, with overall tighter financial conditions restricting expansion by around 1 percentage point, Goldman economist Daan Struyven wrote in a note Tuesday. In October, he had said the positive wealth effect from equity gains in 2017 and early 2018 had likely evaporated.

Pass the Grey Poupon and avoid a recession.

Goldman Says Rich People Will Drag Down the U.S. Economy by Spending Less [Bloomberg]

Remember when everyone was worried about Goldman Sachs? 

The Death Star of Wall Street was bleeding from the trading floor, old habits were dying hard and costing money, there was the small matter of Malaysia alleging that Goldman Sachs had - like - conned Malaysia into a financial crisis. Suffice it to say, things at 200 West Street looked so bleak as to be almost unrecognizable, especially since Goldman staff looked around for their familiar daddy figures only to realize that they were all gone, replaced by a smaller team of new daddies who felt more like distant uncles. But the thing about these new guys was that they felt different because they are; the age of traders died with Lloyd and Gary. David Solomon and John Waldron are investment bankers, dealmakers, a reality that made traders seem even more uneasy when they weren't distracted by losing so much money. 

But it turns out that the new daddies might have had a plan all along:

Goldman Sachs Group Inc., owner of one of Wall Street’s top deal-making franchises, leaned on that business last quarter to overcome an industrywide downturn in fixed-income trading.

Merger-advisory fees jumped 56 percent to the highest in more than a decade, lifting the investment-banking division above analysts’ estimates even as companies tempered their stock and bond issuance. The gains helped offset a dismal quarter for the bank’s fixed-income traders, who turned in the worst performance since before the financial crisis.

Like any self-respecting EDM DJ, David Solomon likes a little cosplay. Be it a tank top or a hat or a mouse head helmet, putting a little costume stank on your performative hang low is a prove trick of the trade. So you've got to hand it to DJ D-Sol, after Ned Stark-ing Harvey Schwartz and elevating loyal i-bankers into roles held by traders loyal to Lloyd, Solomon essentially dressed Goldman Sachs up as a 90's investment bank. And it's working: Goldman stock surged 5% after the bell today.

But the best part of this illusion is that Goldman didn't even see stronger results in i-banking. It was simply just not as shitty as the street anticipated.

Fourth-quarter investment-banking revenue fell 5 percent to $2.04 billion, beating the average estimate of $1.93 billion, the New York-based company said Wednesday in a statement. Goldman earned $1.2 billion from its advisory unit. Wall Street analysts were split over how that business would perform, with estimates ranging from about $700 million to $1.3 billion.

Merger strength helped mask the slowdown in fundraising activity for companies as choppy markets weighed on capital markets. Revenue from Goldman’s underwriting business plunged 38 percent to $843 million, a decline the firm blamed on lower leveraged-finance activity and a drop in secondary equity offerings.

DJ D-Sol and "Johnny Fresh" Waldron used another shitty quarter for trading revenue to get back to basics, subtly lower guidance without lowering guidance and remind the street that Goldman Sachs is still Goldman Sachs: an overtly powerful dealmaking machine that just needed some oiling and dusting to kick back into gear. What we're seeing in early response to this quarter is not a recognition that everything is fixed at Goldman Sachs, it's an acknowledgment that the i-bankers are back in charge at 200 West Street, and everyone remembering what that can look like if these guys can get it even half-right going forward into their new regime.

As the old finance adage goes: They always rebuild the Death Star, bro.

Goldman Sachs Dealmakers’ Surging Fees Help Offset Trading Misery [Bloomberg]

For David Solomon, the Malaysian scandal has been like inheriting a nightmare that tanks your stock price and makes your nascent leadership a much more complicated reality. With a foreign government handing out subpoenas, the US economy shitting its own pants and a creeping sense that Lloyd Blankfein spent a lost month clubbing with Jho Low, DJ D-Sol finds himself needing to staunch the bleeding at the end of 2018. A declarative statement is needed to show the rank-and-file that Goldman Sachs will remain Goldman Sachs in 2019 and beyond.

According to WSJ, this is what he came up with...

In a message posted to Goldman’s internal website, Mr. Solomon defended its culture and compliance measures, both of which have been criticized by prosecutors who last month criminally charged two former Goldman bankers in the widening probe. He has been relatively quiet on the matter since the U.S. Justice Department unsealed indictments Nov. 1.
“While we understand the anger and skepticism, we do not believe that the criticism directed at us accurately reflects who we were then or who we are now,” Mr. Solomon wrote. “Our culture and our processes around our due diligence and compliance was strong at the time, and is even stronger today.”

Instead of setting fire to the past and letting the old ways die, everyone's favorite part-time EDM club king is pivoting to a more Bart Simpsonian leadership tact, imploring employees not to have a cow since "We didn't do it, nobody saw us do it, they can't prove anything."

And, yes, we're also wondering how Marty Chavez would have handled this.

Goldman CEO Defends Firm on 1MDB Accusations [WSJ]

Here at Dealbreaker, we don’t know much about Malaysian law. Maybe our colleagues over at Above the Law do, but we didn’t ask them. Instead, we spent about 45 seconds perusing Wikipedia, where we learned that the country employs a British-style common law system, with much of its legal system inherited from its former colonial masters or based on the legal systems of others who threw off Albion’s yoke, such as Australia and India. We learned that there’s Shariah law for Muslims, although for reasons that will become clear shortly that’s probably not of great interest to us today. We also were pleasantly surprised to find that the Malaysians are in the process of abolishing capital punishment, which certainly makes the country’s legal system seem more humane and less capricious than, say, Texas’. All in all, it doesn’t sound that bad, which is perhaps why Singapore couldn’t stand to be part of the country for any more than two years. Still, this sounds pretty bad.

Malaysia filed criminal charges against Goldman Sachs on Monday, accusing the giant Wall Street bank of making false and misleading statements….

Goldman misled potential investors in its marketing materials for 1MDB bonds in violation of Malaysia’s securities laws, Mr. Thomas said. Goldman benefited from its work with 1MDB and received fees that were “several times higher than the prevailing market rates,” he added. Those fees in turn led to fat bonuses and increased the bank’s ranking in Asia.

Goldman has “fallen far short of any standard,” Mr. Thomas said in a statement. “They have to be held accountable.”

That’s very much not the story that David Solomon and Lloyd Blankfein are telling, although it seems like it’s probably in line with the story ex-Goldmanite Tim Leissner is telling the U.S. Justice Department. Leissner, too, was indicted in Malaysia, as was another Goldman vet, Roger Ng, who may or may not be regretting his choice to fight extradition from Kuala Lumpur to Brooklyn. A former 1MDB executive was also charged, as was deal mastermind, fixer, go-between and party-thrower extraordinaire Jho Low, who does not sound like he’ll be availing himself of the hospitality of Malaysian (or American) authorities any time soon.

Mr. Low’s lawyers said in a statement that he was innocent and that he would not travel to places “where guilt has been predetermined by politics….” Mr. Low is believed to be in China, though his exact location is not known.

Goldman and the rest of them join former Malaysian Prime Minister and husband of diamond enthusiast Rosmah Mansor Najib Razak in the dock. Can it be long before a certain Australian supermodel joins them?

The huge sums of money that were stolen bought much more than tiaras, including a $250 million yacht, a $35 million Bombardier jet and a see-through grand piano that is currently sitting in the living room of the supermodel Miranda Kerr.

Anyway, we’re guessing Goldman doesn’t know that much more about Malaysian law than we do, but whatever they are, the Elect are quite sure they didn’t break them.

“We believe these charges are misdirected, will vigorously defend them and look forward to the opportunity to present our case,” he said.

Speaking of getting defensive...

“The path of the market next year will depend on investor perception of the longevity of the current economic expansion,” strategists led by David Kostin said in a note released late on Dec. 14. “Investors should increase portfolio defensiveness.”

Malaysia Files Criminal Charges Against Goldman Sachs Over 1MDB Scandal [NYT]
Goldman Says It's the Time for Stock Investors to Get Defensive [Bloomberg]

Now Robinhood is a success, and by that, we mean another Silicon Valley unicorn with no foreseeable profit structure and a disruptive idea that needs evolution. The company has already rolled out a few subscription products, has started clearing its own trades and selling user trades to HFTs, but disruption can be limiting unless you find someone else to disrupt...

The five-year old company unveiled "Robinhood Checking & Savings" on Thursday, which offers checking and savings accounts with no fees and pays an interest rate roughly thirty-times the national average. Customers will earn 3 percent annually on money in either accounts, paid out on a daily basis.
"We as a company are going make the financial services industry more inclusive and are going to do it with zero commissions, a lower cost structure, and by relentlessly automating and building an engineering-first company," Robinhood's co-CEO Baiju Bhatt told CNBC in an interview. "We're charging no fees, period."

Looking beyond the mindnumbing interest rate, the lack of fees and the horseshit about "inclusivity," you can find a small sliver of psychological space to applaud Robinhood's chutzpah. Savings accounts are likely one of the last things that Robinhood users think about when it comes to finance, but offering an actual "free money" rate is the kind of thing that might very well entice 27-year-old crypto bros to put a few hundy in a deposit account and let it sit there. That possibility presents an obvious and immediate existential risk to almost every regional and community bank in America.

More than half of all deposits in the US banking system are held by 15 banks, and there are currently 5,477 FDIC-insured institutions in the US. Robinhood [which will be covered by SIPC instead of FDIC because, well, c'mon] is essentially elbowing its way into the dogfight for the other half with stacks of cash in its hand and what we would hope to be a very well-defined metric of how much market share makes this whole thing worth the cash burn. It's...a plan.

But we think we see one very specific goal that Robinhood should have in mind.

We all know about Marcus by Goldman Sachs, right?...No? Well, we're not that surprised. Goldman has a little retail lending and banking startup with a really bad name and roughly $29 billion in deposits. Lloyd Blankfein was particularly fond of Marcus, as is Goldman's former retail banking chief and newly-minted CFO Stephen Scherr, but D-Sol seems to be making it clear that he is less so, rolling it into Goldman's broader wealth management unit. Marcus is simply too incognito and small to really get anyone at 200 West Street horny enough to do anything about it, but the idea that it will now be part of a larger consumer finance arm and possibly hungrier than ever for money presents a really interesting twist on Robinhood's new savings account.

If Robinhood can make this highwire act work, it might be able to grab enough market share and grow its deposit base fast enough that it becomes a super-attractive acquisition target before it becomes too obvious that a 3% annual rate is cripplingly unsustainable when you're not charging fees but are allowing adult children to trade crypto and pot stocks on your platform. Remember how we said that the top 15 banks hold the majority of all deposits in the US? Well, as of March, Goldman was number 15 on that list, a mere $2 billion in front of Morgan Stanley, putting Goldman on the ass end of the deposit power pack with its fiercest rival nipping away at its heels.

Goldman has been pretty unsubtle that it wants -and maybe needs- to make Marcus into something, so what's preventing a reality in which Robinhood manages to pull down $10-20 billion in savings deposits over the next three quarters [stranger things have happened], making it a relevant and enticing option for Scherr to pitch as an acquisition? Adding Robinhood's cash to Marcus' growth [we would assume that Robinhood's burn rate would provide a discount on the purchase price] would put Morgan Stanley in the dust and push Goldman towards competition with consumer finance rivals like Schwab and SunTrust.

And then there's the fact that Goldman would be getting Millennial money. We all know how obsessed the dads at 200 West are with the youths, so putting a ton of their money and attention into Marcus would be a backdoor way of invigorating a confusing brand with literal young money. It's also worth considering what Goldman tech guru Marty Chavez could do with Robinhood's trading platform, and the data it has on its more than 3 million users.

Obviously, this is all batshit contemporaneous thinking, but we're old now and watching a trading app offer kids 3% annual on an essentially uninsured savings account makes us think crazy things.

This is David. The events around 1MDB have given rise to criticism of the firm and speculation in the press about the impending results of the various ongoing investigations.….

The government’s actions against these individuals have generated speculation about potential outcomes for the firm. To be clear, any speculation in the press or elsewhere is completely unfounded.

You should be assured that Goldman Sachs will continue to hold itself to the strongest standards…. A group of people, including some of us in the Executive Office, are intensely focused on this matter. For the rest of us, our job is to focus on our clients, our business and the many opportunities ahead.

In other words—and for the first and only time—ignore the EDM DJ behind the curtain! And also that thing that group of people said about “significant fines, penalties and other sanctions.” That kind of completely unfounded speculation only belongs in a regulatory filing, and not in the press, and certainly not on the lips of any of the Elect.

We’re sure you’re resting well assured that Goldman will maintain the same strong standards that allowed a few of rogue bankers or regular Goldman bankers, depending on which story you wish to tell, to help some foreign officials steal and launder a couple of billion dollars. Now, to quote Bill Belichick—and not because he plays fast and loose with the rules—do your job. Also, Thanksgiving is cancelled. See you Thursday morning bright and early or else.

Goldman CEO’s message to staff on 1MDB scandal [FN]

The statement also includes some music to D.J. D-Sol’s ears, specifically that those rogue agents worked overtime to keep those meddling schoolmarms in legal and compliance from finding out about, you know, the bribes and diamonds and princelings. That very much fits the story Goldman wishes to tell about its involvement. This, alas, does not:

During his guilty plea in August, Mr. Leissner also said that his decision to hide his actions from Goldman’s compliance department was “very much in line” with a wider culture at the firm.

As such:

After prosecutors released details of their case last week, Goldman Sachs said for the first time in a regulatory filing it expected to pay “significant fines” to resolve the investigation into its role in the 1MDB scandal.

Ex-Goldman Sachs Banker Said Colleagues Were Involved in 1MDB Scandal [NYT]

The criminal charges leveled against two former Goldman Sachs bankers are decidedly not a good look for the bank or for its new CEO, David Solomon. This is especially true since at the time one of them admits he was laundering money and tossing around bribes to win Goldman the privilege of arranging $6.5 billion in loans for Malaysia’s apparently entirely criminal sovereign wealth fund, Solomon was in charge of Goldman’s investment bank, and thus those men’s boss.

Goldman has long maintained that it had no idea what Tim Leissner was up to when he wasn’t planning parties or doing entirely legitimate investment-banking things. It still maintains this. Unfortunately, some new shit has come to light that makes this defense a bit trickier. On the bright side for Solomon, though, he can point the finger at the guy in the fancy new office down the hall.

Two weeks later Lloyd Blankfein, one of the world’s most powerful bankers who at the time was chairman and chief executive of Goldman Sachs, attended a meeting with Mr Low and Najib Razak, who was then Malaysia’s prime minister….

The revelation that Mr Low met with Mr Blankfein at least once could undermine this “rogue employee” narrative…..

Prosecutors believe that Mr Low met on a second occasion with a senior Goldman executive in 2013 at a gathering that included the Malaysian PM and one of his family members….. A person briefed on the matter said that the unnamed executive at the 2013 meeting detailed in the filing was Mr Blankfein, although there is some doubt over whether Mr Low was at that second meeting.

Lloyd Blankfein revelation piles pressure on Goldman over 1MDB [FT]

Goldman Sachs Group Inc. on Wednesday named 69 new partners, its smallest class in two decades as the Wall Street firm aims to maintain the allure of its upper ranks.

The full list is here. Congratulations to the newest threats to David Solomon's nascent reign, all 69 of you.

These 69 New Goldman Sachs Partners Are the Happiest People on Wall Street Today [WSJ]

The US investment bank has appointed Thomas Doyle as head of single stock synthetic products group distribution in Europe, the Middle East and Africa. Doyle previously worked at Citi, where he was head of synthetic distribution and stock loans within delta one sales….

David Cornish has also joined Goldman, as head of quant distribution. He will work across prime brokerage and electronic trading. Previously, Cornish was an executive director at JPMorgan, where he worked in hedge funds and alternatives within investor services sales.

Hopefully, this will distract your attention from other, less important matters.

In its third-quarter earnings report, filed to regulators on Friday, Goldman cited language from a recent indictment against a former partner for bribery and money laundering involving Malaysian sovereign-wealth fund 1Malaysia Development Bhd., or 1MDB. Goldman acknowledged for the first time the firm could face significant penalties resulting from the allegations but added that it is cooperating with investigators.

Goldman Sachs hires trading and hedge fund duo from Citi and JPMorgan [FN]
Goldman Disclosure in 1MDB Probe Points to Potential Control, Cultural Concerns [WSJ]

Basically, DJ D-Sol's elbows appear much sharper than we thought they would be, and he seems to be clearly laying down a body rocking bass beat on what he intends to be a long set in the CEO booth at 200 West Street. And it now seems like he's done hiding it because Goldman Sachs is due to name its newest crop of partners, and the early news is that there aren't going to be very many...

The Wall Street firm is set to name its smallest class of new partners in years this week, according to people familiar with the matter. It’s the first crop of promotions under Chief Executive David Solomon, who aims to keep Goldman’s upper ranks exclusive and compensate for a recent influx of outside hires.
Fewer than 65 people are likely to get the nod, the people said. That would be the smallest class since 1998, when Goldman was still a private company, and fewer than the 84 promoted two years ago.

Hey, we get it. DJ D-Sol has already eliminated many of the larger threats to his throne, why add a flotilla of newer, younger, hungrier ones before he even gets the "& Chairman" added to his title at the end of the year? The guy has a company to run between cullings of potentially disloyal usurpers. This is just solid management of a newly-minted oligarchy...

Candidates are vetted by a group of top executives—a process known internally as “cross-ruffing,” a term borrowed from bridge—but aren’t interviewed themselves. If selected, they can expect to hear the news personally from Goldman’s CEO.
Mr. Solomon told managers to be extra selective this year, people close to the process said. Fewer people were considered and there has been less of the last-minute lobbying that has padded the final list in past years, the people said.

See? Letting the ranks of potential challengers swell on purpose is what happens when you let traders run the place. When I-Bankers like D-Sol play the game of thrones, they start off by immediately eliminating half the competition and then locking all the entrances.

Welcome to your new life, Goldman serfs.

Fewer Stars to Rise at Goldman Sachs as Partnership Class Shrinks [WSJ]

Tim Leissner, a former partner for Goldman in Asia and once among its highest paid employees, pleaded guilty to conspiracies to launder money and violate foreign antibribery laws for his role in helping raise money for the fund, known as 1Malaysia Development Bhd, or 1MDB….

The Leissner guilty plea is the biggest black eye for a Goldman partner since 1989, when executive Robert Freeman was led off the trading floor in handcuffs, later convicted of a crime related to insider trading. The charges will test the bank’s new CEO, David Solomon, who was running the investment-banking division at the time Goldman underwrote the Malaysian bonds and was ultimately Mr. Leissner’s boss.

Of course, a scandal of this scale—$2.7 billion allegedly skimmed from the $6.5 billion Goldman helped 1MDB raise and spent on diamonds and prime ministers and a weekend at the Venetian and movies starring Leo DiCaprio—is rarely the work of just one man, even if that man is married to Kimora Lee Simmons. In this case, Brooklyn prosecutors say it was the work of three. Unfortunately for Solomon, one of the others is also a former Goldman banker, while an unindicted co-conspirator is still on the payroll. Even more unfortunately, those prosecutors are looking into whether it can at “Goldman, Sachs & Co.” to the list of defendants.

Roger Ng, the other former Goldman banker, and Mr. Low, who allegedly masterminded the fraud, were indicted on three conspiracy counts to violate foreign antibribery laws and launder money….

Prosecutors from the U.S. attorney’s office in the Eastern District of New York have been investigating whether Goldman violated any laws in its role arranging the 1MDB bond sales, The Wall Street Journal previously reported….

Goldman on Wednesday placed another senior banker on leave after he was cited as a key player in the 1MDB dealings. Andrea Vella, who was until recently Goldman’s co-head of investment banking in Asia, isn’t identified by name in the charging documents, which refer to an “Italian national” as a co-conspirator. People familiar with the matter confirmed his identity.

Justice Department Charges Ex-Goldman Bankers in Malaysia 1MDB Scandal [WSJ]

This is definitely news as Dina and Goldman exist so outside the realm of normal PR morality that the vast majority of people paying attention seemed to let her attendance skate away from the encompassing wave of moral outrage. Announcing that she's staying home to wash her hair that week on television is a pretty bold move from DJ D-Sol and something that says "Lloyd would have sent her" in the way that Goldman prefers to communicate: Good ol' subtext.

But why now? Why push this narrative today? Who could have lowered the bar of morality optics so low that even Dina had to tell the boys at Teterboro to burn her Saudi flight plan?

Just met with @realDonaldTrump and @SecPompeo and we have decided, I will not be participating in the Future Investment Initiative summit in Saudi Arabia.

— Steven Mnuchin (@stevenmnuchin1) October 18, 2018

Yeah...that'll do it.

We still say that Mnuchin shows up [likely wearing a mustache disguise and trying to wink behind Transition Shades that have gone totally opaque in the desert sun] but for now he's "not." Losing the moral high ground to a weirdo former employee that lives a life free of caring about what is just is not something that David Solomon wants to deal with so early in his tenure. And who knows what might happen to his side-gig if Paul Oakenfeld and/or David Guetta go all #Justice4Khashoggi?

But now Dina and Mnooks are out [at least Dina *wink wink*] so it looks like is just going to be Masayoshi Son and MbS starting at each other in a room full of terrifying Russian "bankers."

Fun!

And that's because it was only the beginning of the year...

Dina's been back at Goldman for a matter of months, using what she learned inside this ever-changeable administration to guide Goldman's understanding and also pad DJ D-Sol's diversity in management stats. We would have no idea what Dina's day-to-day is like, but it seems as if some of it has been taken up by pining away for the US ambassador to the UN gig...Which is suddenly available...

Dina Powell, a Goldman Sachs executive and former deputy national security advisor to President Donald Trump, has had discussions with senior members of the administration about possibly replacing Nikki Haley as U.S. ambassador to the United Nations.
In the days leading up to Haley's sudden and surprising resignation Tuesday, senior White House officials reached out to Powell about possibly taking the role, according to three people with direct knowledge of the matter.

Let's get two things straight: Dina Powell is a pretty strong choice for UN ambassador in a Trump administration, and it's objectively fucked that she would be nominated for the role.

On the former point, Powell's resume speaks for itself. She is beyond worldly, sees the state of global play from a perspective that's as [and arguably more] useful than that of a career diplomat, can navigate the cultural divide between DC power players and NYC power players, and is most importantly the kind of intelligent globalist cuck that can best temper the current president's instinct to destroy an institution created for the advancement of globalist cuckery.

On the latter point, Dina Powell is now the living embodiment of the revolving door between Wall Street and Washington. If she is indeed nominated and confirmed to take over the UN gig early next year, that would make three turns through that allegorical door in two years time. Can anyone honestly imagine any other administration getting away with lending and borrowing a top Goldman Sachs executive back and forth in key roles?

Dina Powell might make a transformatively wonderful Ambassador to the UN one day, but if that day ever comes, let's not forget that the only reason a qualified, talented and politically unpalatable executive was able to get the job was because a sitting US president had to be convinced that his fashion "magnate" daughter would not get through a Senate committee vote.

And now we have another example of modern finance's Forrest Gump having an accidental direct impact on history by simply being his gormless self.

As part of David Solomon's coronation day celebrations at Goldman Sachs, Vanity Fair has published an in-depth profile of the new Head Bald in Charge at 200 West Street. William Cohan's piece is an excellent piece of reporting that manages to give us a sense of DJ D-Sol as a person while also conveying his role within the macro structure of the new Goldman and by extension its role in the macro structure of quietly ruling the world. We learn how Solomon came from hardscrabble Hamilton College in the bowels of the lowly NESCAC, and overcame Goldman's early rejection to forge a career in the hinterlands of finance (BNY Mellon, Drexel, *gag* Bear Stearns) before working his way into Goldman as a partner and beginning his decades-long ascension to the throne.

But it's how Solomon made the exceedingly rare leap from competitor to Goldman Sachs partner that caught our eye. Solomon is clearly a talented and intelligent banker, but we can count on zero fingers the other examples of people that entered the DeathStar as a senior officer. What strange alchemy of genius and timing allowed for this to happen, and what are we not seeing?

Oh, of fucking course. It was Stevie Mnooks that made the miracle happen.

Per Cohan:

Ironically, Solomon’s new position at Bear Stearns inadvertently paved his way to Goldman. In 1997, Bear and Goldman were the lead underwriters for the Venetian casino and resort in Las Vegas, which was being developed by business magnate Sheldon Adelson. Solomon co-headed the Bear team, while Jon Winkelried, now the president of TPG Capital, led the Goldman team, along with Steven Mnuchin, currently serving as Treasury secretary. 

So there's Winkelried, trying to close a huge deal with the notoriously easy-to-deal-with Sheldon Adelson while also saddled with the fact that Hank Paulson had made it his turn to babysit Bob Mnuchin's kid. The stress on Winkelried must have been intense as he tried to nail down specifics on half a billion dollars in bonds on a $1.5 billion casino, fending off the gothically nightmarish challenges of doing business in Las Vegas [*coughs* Steve Wynn *coughs*], and constantly wondering if the whole thing was going to fall apart because everyone involved was getting visibly creeped out by Mnuchin just sitting there in a suit saying nothing and doing that bizarre reptilian thing he does with his mouth.

But then, like a comparative angel descending from the heavens of relative normalcy, came DJ D-Sol himself. A raconteur and bon vivant who people aren't weirded out by...and who also knows a thing or two about bidness. Winkelried must have been enamored. Wait! He definitely was...

Winkelried quickly came to admire Solomon’s judgment, his command of the facts, and his willingness to be a team player. “He was very collaborative,” Winkelried says.

And most importantly, he wasn't Steve Mnuchin, which apparently made Winkelried as thirsty as a Supreme Court nominee at a house party...

In January 1999, after an elaborate closing dinner for the deal at a resort in Cancun, Solomon and Winkelried flew back together to New York on the same flight. “You should really come to Goldman Sachs,” Winkelried urged. Solomon, by then one of the top executives at Bear Stearns, demurred. “I really don’t think I would do that,” he said. But Winkelried persisted, repeatedly inviting Solomon to dinner and making the case for moving to Goldman. Winkelried even offered Solomon a partnership—one of the few times Goldman had bestowed the coveted position upon an outsider.

And there it is, the mystery solved. David Solomon worked hard, made smart professional decisions, learned how to manage people and create value for his employers. But the real reason, the hidden alpha in what led to David Solomon becoming CEO of the most powerful financial services firm in the world this morning: He was once compared to Steve Mnuchin.

“YOU CAN’T OUT-LLOYD LLOYD”: AT GOLDMAN SACHS, THE DAVID SOLOMON ERA BEGINS WITH SUBTLE BUT SIGNIFICANT CHANGES [Vanity Fair]

The transition from Dear Uncle Lloyd to the sick Millennial beats of DJ D-Sol was never going to be an easy one, but an old friend of the firm is hearing that things at Goldman Sachs are less "This is going to be tense' and more "Do you hear the people sing? Singing the songs of angry men?"

According to everyone's favorite socialist-leaning reporter Charlie Gasparino, the plans for Lloyd Blankfein's post-CEO life at Goldman Sachs have created a cultural revolution inside the walls of 200 West Street.

Quoth the Gaspo:

Goldman Sachs wants to send Lloyd Blankfein off in style: The prestigious white-shoe investment firm is spending top dollar to build its soon-to-be retiring chief executive a new office as he transitions to an adviser for the firm.
The move is not sitting well with many of the rank-and-file employees, several of whom are complaining to FOX Business about the spending on Blankfein’s new digs.

A GS spokesman told Charlie that the costs of the project are a mere $100K and that there is no cultural unrest among the working class of six-figure earners at Goldman. But then again, that's just what you'd expect a cruel kleptocratic regime to say...

In an official statement, a Goldman spokesperson tells FOX Business the cost of the office would be as much as $100,000. But sources familiar with the matter tell FOX Business the cost could exceed $500,000. The official construction began on Friday at 5 p.m., with several employees being forced to move to make room for Blankfein’s new digs. He was originally slated to occupy an already available office, but the firm decided to erect a more spacious office with a coveted view of the Hudson River, and to use high-priced union workers to construct it on the weekends, people with knowledge of the matter tell FOX Business.

It turns out that the snowflake analysts at Goldman Sachs are all down with capitalism when it suits them [like working at Goldman Sachs] but they also want a little socialism mixed into certain aspects of their lives [like ...working at Goldman Sachs]...

Analysts and associates, who spoke to FOX Business on the condition of anonymity for fear of losing their jobs, say Goldman has cut back on benefits for the average worker more than any other bank on Wall Street. They base their assessment on both personal experience, as well as anecdotal evidence gleaned from employees at other big banks.
Despite the deteriorating work environment, they remain at the firm largely as a resume builder, based on Goldman’s long-time reputation as Wall Street’s premier investment bank catering to the super rich and the world’s biggest corporations.

And you should hear the subhuman conditions these poor profit serfs have to live and work under on a daily basis...

Employees who work past 8 p.m. at Goldman’s West Street Manhattan headquarters say the bank will technically pay for their dinner, but only if the meal doesn’t exceed $25 – less than half the average cost of a meal in New York City, according to Zagat’s Opens a New Window. . Additionally, not all food groups can be expensed. One Goldman employee says the company rejected a reimbursement expense for a piece of fruit because the food group didn’t meet Goldman’s stringent criteria. Employees who surpassed the $25 limit are forced to reimburse the company with a check, these people say. Goldman declined to provide details on its reimbursement rules to FOX Business.

Shut up about "The 80s and 90s," grandpa. Hell is real and these poor Goldman Sachs analysts are living in it!

Goldman’s cost cutting also forces most employees to spring for their own computers and iPhones, even though analysts and associates are expected to be monitoring emails 24/7. Also, attending industry conferences was once considered an educational experience for lower-level Wall Street employees, but at Goldman managers routinely reject these requests amid the draconian budgeting, these people say.

So you'll forgive the third-year analyst pulling down $110K before bonus is he's not so psyched that Lloyd's new office is going to be so very luxe and dope while he has to sit in a cube and share his Bloomberg with some guy who's "not" a nephew of some powerful Emirati dude. After all, The Blankfein Era is about to be ancient history and the feel-good cool bro reign of David Solomon is about to begin...

What is clear is that the office drama has stoked a degree of outrage among the masses inside the parochial investment bank with some employees complaining that it is just another example of the disparity between the firm’s “haves” and “have nots.”
“This is one reason why no one smiles at work,” said one Goldman employee. “Everyone looks miserable all day long.”

To the ramparts, Bolshevik Goldmanites! Lloyd's new office MUST BURN!!!

Goldman's lavish spending on Blankfein’s post-CEO office sparks populist debate at white-shoe firm [FoxBiz]

But unfortunately for sweet Martin, it appears that his reign was to be postponed by another man, an EDM DJ and wine connoisseur who apparently reads Dealbreaker and knows that we are the seers of the future. And by reading our secret texts, DJ D-Sol learned of the prophecy, and now Marty Chavez is dead...

David Solomon is assembling his inner circle as he prepares to take the helm at Goldman Sachs Group Inc., replacing the bank’s chief financial officer and installing a longtime lieutenant as his top deputy.
Goldman is expected to name John Waldron as its president and Stephen Scherr as its new finance chief, replacing Martin Chavez, according to people familiar with the matter. The shakeup shows Mr. Solomon putting his imprint on the firm he’ll soon run and represents a triumph of Goldman’s investment bankers over its traders, who have been on their heels since the crisis.

Since John Waldron has staked his claim to a new life as Gary Cohn 2.5, we will have to assume that he is the one that wielded the knife in Marty's assassination. But while he was the one who did the stabbing, it might never be possible for David Solomon to truly clean his hands of the blood that stains them.

MARTY LIVES!!!

Goldman Sachs’ Next CEO Replaces Finance Chief, Names Top Deputy [WSJ]

But Elon isn’t taking Tesla private. And Goldman will thusly not be getting paid. So it’s not afraid anymore to tell you what it really thinks of its tease of a former client.

The firm resumed coverage of Tesla with a sell rating, predicting the competition will cut into the company's share of the electric car market…. Tamberrino gave a $210 six-month price target for Tesla shares, representing 30 percent downside to Friday's closing price….

"Altogether, we remain bearish on the company's ability to execute, achieve its targeted production ramp/margins, and sustain FCF [free cash flow] generation."

We await photographic evidence of David Einhorn gleefully prancing around in his stylish shorts.

Goldman: Tesla shares to drop 30% in the next 6 months due to increased competition [CNBC]

Labor Day has come and gone, meaning that it's back to reality for all. And as a sign of the season, Goldman Sachs CEO-elect, old man EDM DJ David Solomon hit the decks at a Montauk beach club and dropped a deadly beat on what was left of summer:

View this post on Instagram

View the original article to see embedded media.

Now say goodbye to Lloyd and go pillage what's left of Italy.

In their telling of the 1MDB scandal—you know, the one with the diamonds and lavish vacations and former and now-indicted Malaysian prime ministers and Leonardo DiCaprio—federal prosecutors in Los Angeles were in remarkable accord with Goldman Sachs: The whole sordid tale was the work of former Goldman banker and thrower of great wedding receptions Tim Leissner, who was as good at financing billion-dollar scams as he was hiding them from his superiors at the bank. Unfortunately for both, federal prosecutors in Brooklyn want to tell it a different way, possibly working with a co-author who Goldman once kept from moving a little closer to his wife (and clients on the other side of the Pacific).

The charges that were drawn up against Mr. Leissner included an accusation that he had provided misleading information to Goldman, something he was previously sanctioned for by securities regulators in Singapore.

The prosecutors in Brooklyn, who joined the investigation about two years ago, objected to the filing of charges against Mr. Leissner, which they said would hamper their investigation into Goldman’s possible role in the scandal, the people said. The worry was that accusing Mr. Leissner of tricking Goldman could undermine their case by casting the firm as a victim, one of the people said….

The prosecutors in Brooklyn are now considering their own criminal charges against Mr. Leissner, which they hope will motivate him to cooperate and to provide more information about Goldman’s overall role and the roles played by others at the Wall Street firm, the people said.

Goldman Sachs Is Said to Be Under U.S. Scrutiny in Malaysian Inquiry [NYT]

New York City-based DJ D-Sol (aka David Soloman) – and, in his day job, Goldman Sachs COO – debuts at No. 39 on Billboard's Dance/Mix Show Airplay chart (dated July 28) with "Don't Stop." The remix of the 41-year old Fleetwood Mac classic (the original peaked at No. 3 on the Billboard Hot 100 in September 1977) is the DJ/business executive's first Billboard chart entry. "Don't" owes its debut to airplay on SiriusXM's BPM and WCPY Chicago, according to Nielsen Music.

It's pretty hard to compete with David Solomon's July 2018, you guys. Not only does his new single drop almost immediately onto the dance charts, but he also got a fun promotion at work!

But like any DJ who has to hold down a civilian gig just to pay the electric bill, D-Sol is very into managing his work-life balance, and at his Goldman Sachs, so will everyone. According to CNBC, Solomon has been making it sound like things at 200 West Street are going to substantially more dope as fuck under his leadership...

Goldman Sachs’ next chief executive officer and chairman, David Solomon, often talks about his personal interests, including an unusual side gig as a dance club disc jockey. Now, he wants his leaders to open up.

Ummm, that is adorable!

To help foster connections with employees and clients, Solomon said that "leaders today have to be more vulnerable, they have to put themselves out there a lot more than they probably are comfortable doing," said Levine.

"More vulnerable?" Was Gary Cohn's emo goth phase not enough for you people? Have you not read John Rogers' "Lloyd Blankfein as sexy vampire" fanfic? Does Marty Chavez need to show you his other, private, tattoos?

What firm is more synonymous with vulnerability than Goldman Sachs, the opaque global financial giant that resides in an unmarked glass tower in a purposefully, oddly remote section of lower Manhattan and is run by people with a habit of moving deftly in and out of the federal government?

But under DJ D-Sol, 200 West Street is turning into a totally open space, chock full of poet warriors who better show some serious fucking improvement in their trading business. And if he has to, the newest addition to the Billboard dance charts will lead by vulnerable-bro-with-outside-interests example...

"It's something I'm really passionate about," Solomon said in the podcast. "If you can't find a way to have passions and pursue those passions and mix them into your professional life and your personal life, it's just harder to have the energy to keep on doing this."

And he's not just a fan of dropping sick beats, he's a fan of his own emotions...

Solomon may be uniquely suited for the new Goldman. Where Blankfein is known for a quick wit, Solomon is more likely to come off as disarmingly earnest. The day after a ceremony where he was formally introduced by Blankfein as his successor, Solomon spoke to a roomful of the bank's interns, expressing wonder that he would soon be running the place.
"When Lloyd called me up at the stage, I was pretty emotional about it, it really affected me," Solomon said. "I was shaking."

This is going to be so great for us.

Billboard Dance Chart Upstarts: D-Sol, Excision & Illenium and Said the Sky [Billboard]

Goldman's next CEO wants a more human and open firm, urges his team to 'be more vulnerable' by sharing their personal lives [CNBC]

Like most former leaders of Goldman Sachs, Lloyd will have a few options for his next act, but one of his fellow Masters of the Universe has already accidentally closed the door forever on one possible career path...

Per Bloomberg:

Few executives wield more power over global capitalism than the head of Goldman Sachs Group Inc. Fewer know what it’s like to leave that perch. Jon Corzine is one of them.
So he has a sense of what Chief Executive Officer Lloyd Blankfein was feeling when the bank announced Tuesday that David Solomon will take over in October. And he has an idea about what he can do next.
“If he can successfully handle the pressure cooker elements that come with the scrutiny, the criticism that is inevitable, and gets through it, I think he’d make a very good mayor,” Corzine said in an interview. “There’s no reason he shouldn’t try.

Wow, this really sucks if Lloyd actually maybe wanted to be mayor. After all "Jon Corzine Endorses Fellow Former Goldman Sachs CEO For Mayor" is the closest thing that we might ever see to a written sentence metastasizing into literal political poison.

Corzine -- who himself faced fury and an industry ban after the 2011 collapse of his brokerage MF Global -- doesn’t think rage will kill Blankfein’s political chances. He described the billionaire like this: “Lloyd at his essence is a man from Brooklyn. He grew up in a simple world, and he represents a lot of what the so-called American Dream is about.”

As we say in Brooklyn, "The fuck you talking about, Jon Corzine?"

Hey, at least Corzine didn't say Lloyd should take over a commodities brokerage and get creative with it.

Mayor Lloyd Blankfein? Jon Corzine Says He’d Be ‘Very Good’ [Bloomberg]

From Goldman Sachs:

The Goldman Sachs Group, Inc. has announced today that Lloyd C. Blankfein will retire as Chairman and Chief Executive Officer and that the Board of Directors has appointed David M. Solomon to succeed him in both roles.
Mr. Blankfein will step down as Chief Executive Officer on September 30, 2018, and will retire from the firm and as Chairman of the Board at the end of the year. Mr. Blankfein will accept the title of Senior Chairman after his retirement. Mr. Solomon will join the firm’s Board on October 1, 2018.
Mr. Blankfein has been Chairman and Chief Executive Officer since 2006.

The 12 year rain of El Lloyd will officially come to an end at the end of September, giving Blankfein the first real summer he's had since the George W. Bush administration. And if you think that Lloyd isn't going to take advantage of that, well, you don't know L-Blankz.

Not only is Blankfein getting like 10 weeks of paid Senioritis, he's doing it in the wake of Goldman destroying its Q2 estimates, setting the table for DJ D-Sol to get to work and try to drag Goldman back to its rightful place atop the mountain of Wall Street. Sure, the Deathstar of Global Finance remains mired behind JPMorgan and Morgan Stanley at the moment, and the firm's trading performance is at UBS levels of shameful, but Lloyd has survived cancer, the mortgage crisis, and Gary Cohn's ambition, so you'll pardon the man himself if he refuses to wear shoes in the office and pops an edible every Friday morning before not catching a helicopter to Bridgehampton.

Say what you will about Lloyd's place in the pantheon of Goldman CEOs [and we trust that the hot takes will be soon be flying], but don't say that he didn't put in his time...and definitely don't begrudge him for throwing on some short shorts at lunch and then sunbathing for an hour or two in Battery Park.

Welcome to "The Summer of Lloyd"

According to The Times, 200 West Street is about to see its first changing of the guard. After months of rumor, it appears that Goldman Sachs is set to officially announce that David Solomon will succeed Lloyd Blankfein as CEO at some point this year:

Goldman Sachs is expected to name its president, David M. Solomon, as its next chief executive early this week, according to people briefed on the plan. The announcement would formally establish Mr. Solomon as the successor to Lloyd C. Blankfein as one of the most powerful executives on Wall Street.
Mr. Blankfein, who presided over record earnings during his 12 years atop Goldman, will stay on for an interim period. Anointing Mr. Solomon, however, most likely makes it easier for him to put his future lieutenants in place.
The announcement could be made as soon as Monday, according to people briefed on the plan who requested anonymity because they were not authorized to discuss it.

The timing of this is indeed interesting. After all, DJ D-Sol vanquished his biggest rival Harvey "Big Harv" Schwartz, a few months ago and has been left to plan his own reign in relative peace, leaving Lloyd to eat a few sins and start packing his shit so he can be out by Christmas. Everyone knows that Solomon is taking over [at least until Marty Chavez, a/k/a "The Prince That Was Promised," is ready to run the show] so making his ascension official in July makes us wonder if Lloyd's departure hasn't been pushed up. And using the Q2 earnings as a rationale for this announcement is understandable, but we also now have to wonder what else is in those earnings.

We're also intrigued by the notion that this all about Solomon getting his own people in place. According to our own sources inside 200 West Street, Solomon has already cast his I-Banking acolyte John Waldron as his Own Private Gary Cohn [we personally doubt this as Middlebury graduates are notoriously disappointing replacements], and that he will also have to staff up a few jobs that are bound to open up simultaneously with Lloyd's departure. On that note, we're now taking action on how quickly Lloyd's chief-of-staff John Rogers takes his Blarney and flattery to the Trump White House. And if this deep palace intrigue piques your interest, we encourage you to check out this deep dive from BI.

Peeling back all the snark and gossip [ie , making us irrelevant], we would just like to take a moment and acknowledge how seismic an event we are witnessing. Lloyd's departure marks the end of one of the most spectacular survival feats in financial history. His 12 years at the helm of Goldman have been epochal, and it's going to be weird to not see his bald pate and objectively adorable forced smile as the face of the world's most powerful financial services company.

But if we're gonna lose Lloyd, we could do worse than a fancy winoEDM DJ.

Onward!

Goldman Expected to Formally Name Successor to C.E.O. Lloyd Blankfein [NYT]