This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Goldman's Armor Shows Some Cracks

NEW YORK (TheStreet) -- Goldman Sachs' (GS) shares have mostly been immune to the negative press coverage of the past year, but a recent story from Vanity Fair writer Bethany McLean may have done a little damage.

The stock was one of the hardest hit in a tough day for financial stocks Tuesday, the first trading day after McLean's article went live on the Vanity Fair site. Goldman's stock fell $2.03, or 1.20%, on volume of nearly 13.5 million shares, well above the trailing three-month daily average volume of 9.7 million shares.

Morgan Stanley (MS), Citigroup (C), JPMorgan Chase (JPM) and Wells Fargo (WFC) were among the big financial names that traded lower Tuesday, but JPMorgan was the only one of those that saw higher-than-average volume. American Express (AXP)'s stock took a slightly bigger hit than Goldman's, but on lower-than-average volumes.

McLean's article was notable because it includes stinging attacks from former senior Goldman executives, including "someone close to" John Thornton, a former chief operating officer at Goldman who, according to the article, was an "heir-apparent" to former Goldman boss Hank Paulson. The Vanity Fair article says Thornton was "discomfited by what he felt was a change at Goldman: a newfound obsession with making money first and foremost."

Thornton could not be reached for comment, and Lucas van Praag, Goldman Sachs' head of PR, responded with a one-word "no" when asked via e-mail if the Vanity Fair story was responsible for the selloff. Van Praag did not respond to a follow-up email asking what he thought was responsible.

Thornton's comments, or those of the person "close to" him, may seem minor to the legions of Goldman haters on the Internet, but they are a big deal. Goldman has done a formidable job of maintaining loyalty among former executives, and the suggestion that Thornton, and others who aren't named, are breaking ranks may encourage others to do the same.

1 of 2

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,113.54 +61.81 0.36%
S&P 500 1,983.53 +9.90 0.50%
NASDAQ 4,456.0160 +31.3120 0.71%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs