Comments on: Credit Default Swaps Put Goldman, Merrill, Lehman and Bear at Junk Levels http://www.nakedcapitalism.com/2007/07/credit-default-swaps-put-goldman.html Sun, 22 Nov 2009 01:21:03 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: Yves Smith http://www.nakedcapitalism.com/2007/07/credit-default-swaps-put-goldman.html#comment-303 Yves Smith Fri, 03 Aug 2007 13:15:00 +0000 http://www.nakedcapitalism.com/2007/07/credit-default-swaps-put-goldman-merrill-lehman-and-bear-at-junk-levels/#comment-303 Cassandra,<br/><br/>I was at Goldman many years ago, while it was still a partnership. While the firm had a big risk arb operation (Rubin once headed it), it was otherwise very chary of taking risk, and not merely trading risk. Even very junior people were made aware of where contractual and other risks lay, and the firm would not budge from its standard contractual provisions (the only exception was clients that had grandfathered language). Similarly, any new corporate or institutional client relationships had to be approved by the management committee.<br/><br/>The Goldman of today bears perilous little relationship to the firm in its partnership days. Cassandra,

I was at Goldman many years ago, while it was still a partnership. While the firm had a big risk arb operation (Rubin once headed it), it was otherwise very chary of taking risk, and not merely trading risk. Even very junior people were made aware of where contractual and other risks lay, and the firm would not budge from its standard contractual provisions (the only exception was clients that had grandfathered language). Similarly, any new corporate or institutional client relationships had to be approved by the management committee.

The Goldman of today bears perilous little relationship to the firm in its partnership days.

]]> By: "Cassandra" http://www.nakedcapitalism.com/2007/07/credit-default-swaps-put-goldman.html#comment-300 "Cassandra" Thu, 02 Aug 2007 00:21:00 +0000 http://www.nakedcapitalism.com/2007/07/credit-default-swaps-put-goldman-merrill-lehman-and-bear-at-junk-levels/#comment-300 one wonders whether or not IF GS had remained a partnership that their market behaviour & risk-appetite would have more mirrored that of a "principal" rather than that of "an agent", the latter meaning being entirely in the pejorative. one wonders whether or not IF GS had remained a partnership that their market behaviour & risk-appetite would have more mirrored that of a “principal” rather than that of “an agent”, the latter meaning being entirely in the pejorative.

]]>