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Goldman Sachs No Longer Clearing Trades For Peasants

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The scary thing is that they let it go on this long.

Goldman Sachs limited clearing for accounts that manage less than $5 million, lifting the previous $1 million threshold, said the people, who asked not to be identified because the decision was private. While the firm continues to clear trades for some accounts below the new limit, it’s winnowing out clients that are riskier, have lower growth prospects and are more retail rather than institutional in focus, one of the people said. “We are conducting a routine analysis of our business and in some cases the profile of clients was not consistent with our current standards and criteria,” said Ed Canaday, a spokesman for the New York-based bank. [Bloomberg]


Goldman Sachs Can Fix This

A week ago today, a man named Greg Smith resigned from Goldman Sachs. As a sort of exit interview, Smith explained his reasons for departing the firm in a New York Times Op-Ed entitled "Why I Am Leaving Goldman Sachs." The equity derivatives VP wrote that Goldman had "veered so far from the place I joined right out of college that I can no longer in good conscience say I identify with what it stands for." Smith went on to note that whereas the Goldman of today is "just about making money," the Goldman he knew as a young pup "revolved around teamwork, integrity, a spirit of humility, and always doing right by our clients." It was a culture that made him "love working for the firm" and its absence had stripped him of "pride and belief" he once held in the place. While claiming that Goldman Sachs has become virtually unrecognizable from the institution founded by Marcus (Goldman) and Samuel (Sachs), which put clients ahead of its own interests, is hardly a new argument, there was something about Smith's words that gave readers a moment's pause. He was so deeply distraught over the differences between the Goldman of 2012 and the Goldman of 2000 (when he was hired) that suggested...more. That he'd seen things. Things that had made an imprint on his soul. Things that he couldn't forget. Things that he held up in his heart for how Goldman should be and things that made it all the more difficult to ignore when it failed to live up to that ideal. Things like this: