Thursday, April 26, 2012

Sympathy for the Devils Running Short at Goldman




A few years ago, Mick Jagger was asked why the Rolling Stones were about to embark on one of their gray-haired, past-their-prime tours with big beer-company sponsorships and pricey tickets.  "Is it about the money?" the questioner said.

Without missing a beat, Mr. Jagger replied: "It's always been about the money."

Yes, the Rolling Stones have more in common with the shareholders and board of Goldman Sachs Group Inc. than either of them probably ever considered.  At Goldman, it has undoubtedly always been about the money, specifically, profit, pay and dividends. And even though the bank's singular purpose has never been a secret, it gets obscured by those who try to read too much into what Goldman and Lloyd Blankfein, the New York company's frontman, chairman and chief executive, stand for.

Like every bank, moral choices and social good are secondary to profit and loss burn. If Goldman could make money by feeding starving children in Africa, there would be 1,000 bankers and a Shake Shack in Ethiopia.
This laserlike focus on the bottom line has allowed Goldman's board to overlook a litany of transgressions that would derail companies less committed to the goal of regular and increasing paydays.  That is, until now.

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