You could almost hear Lloyd Blankfein’s response: “It’s not show friends, Greg, it’s show business.”
But, in reality, the oft-vilified Goldman Sachs chief executive probably won’t say anything at all, publicly at least, after one of his minions aired out his “Jerry Maguire moment” in the New York Times editorial pages on Wednesday. Read the full letter.
“TODAY is my last day at Goldman Sachs,” wrote Greg Smith, who was set to tender his resignation as executive director and head of the investment bank’s U.S. equity derivatives business in Europe, the Middle East and Africa.
“After almost 12 years at the firm — first as a summer intern while at Stanford, then in New York for 10 years, and now in London — I believe I have worked here long enough to understand the trajectory of its culture, its people and its identity,” he explained. “And I can honestly say that the environment now is as toxic and destructive as I have ever seen it.”
He went on to point a finger at a corporate hierarchy, and Blankfein specifically, that’s lost its way and is no longer interested in doing the right thing. One that pushes opaque and complex products that may be lucrative to the firm, but not necessarily to the client. Show me the money, forget the rest.
“If you were an alien from Mars and sat in on one of these meetings, you would believe that a client’s success or progress was not part of the thought process at all,” he wrote. Goldman needs to “weed out the morally bankrupt people” and change the get-paid-at-all-costs culture. If it doesn’t, and it loses the trust of its “muppets” — a term used by managing directors to describe their clients — Smith said the bank simply won’t be able to sustain itself. Goldman passed Tuesday’s bank-stress test
Of course, the cynic might say it’s easier to gain such a lofty perspective after feeding off Goldman’s generous trough for more than a decade.
