Here's the latest from Cityboy.
'The resignation letter that appeared in Tuesday’s New York Times from Goldman Sach’s staffer Greg Smith shocked me - not because he discussed the extraordinary concept that Goldman is more interested in making a fast buck than looking after it’s clients, but because a Goldman professional has dared break ranks with his colleagues. If there’s one thing that Goldman does brilliantly, it's to instill an amazing sense of loyalty in its workers that some cynics say borders on brain-washing.
Smith complains that under the watch of Goldman CEO Lloyd Blankfein and President Gary Cohn, the ‘moral fiber’ of the firm he once loved has gone west, especially in how it treats its clients. He claims that when he joined Goldman twelve years ago, its strategy ‘wasn’t just about making money’. He goes on to explain how clients were sometimes referred to as ‘muppets’ and that 'the (work) environment now is as toxic and destructive as I have ever seen it'.
What makes this criticism so powerful is that the letter is, in fact, a plea for Goldman to get back on track, because ‘if clients don’t trust you they will eventually stop doing business with you.’ Its motivation appears benign - like a child pleading with his dissolute father to rediscover his moral compass.
I happen to know that Goldman was unwilling to comment to the media about the story early this morning, and I can tell you that right now a lot of very brainy spin doctors are probably thinking about ‘damage limitation’. I wouldn’t be surprised if poor old Greg Smith’s reputation receives a battering over the next few days. He may well be painted as a bitter loser, who was going to be fired anyway or had, once again, failed to get a promotion. And woe betide the poor chap if he’s ever done anything dodgy in his life, because it may well be raked up.
But I wouldn’t worry too much if I was Blankfein or Cohn. Over the last few years this ‘great vampire squid wrapped around the face of humanity’ (as Rolling Stone journalist Matt Taibbi famously once called the firm) has been allegedly associated with quite a few dodgy things, and this will just be water off a duck's back. The only thing Goldman is likely to focus on now is how come a member of the ‘clan’ felt able to show such treachery.
And one thing is certain, I’m afraid. You can bet your bottom dollar, that despite this latest PR setback, the 'squid' will survive and prosper!'.
Follow Geraint on Twitter at twitter/cityboylondon
Geraint Anderson’s novel Just Business is out in paperback on 15th March.
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