This Day On The Street
Continue to site
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

Goldman's Greg Smith Is the Latest Buddhist Convert From the 1%

It's ironic that the op-ed came a day after the release of the Federal Reserve stress tests and a major rally in the banking sector, as some firms on life support just three years ago after the subprime meltdown announced major dividend hikes and share buybacks with the Fed's blessing.

Indeed, it's the market analysis of the latest Goldman negative headline that may say the most, and the 3% decline as many other banks rose, seems like the real damage. I don't think it's because of what Smith said, but rather the subtext.

"People who care only about making money will not sustain this firm -- or the trust of its clients -- for very much longer," he wrote.

The attack on Goldman's toxic culture designed only for making money also comes during a week when President Obama and the Congress are trying to push through a piece of legislation that will erase investor protections built up through decades and strengthened in the past decade in direct response to Enron and the bubble, a "jobs" act viewed by critics as doing the bidding of the banks and venture capitalists.

In the post-Vampire Squid era, with the bank ban on proprietary trading and the boring old world of commercial loans and mortgages back to being the bread-and-butter of the financial system, it's that much tougher for Goldman to do what it does best in gaming the constrained but still convoluted world of trading. That world is changing, but not enough to make a Buddhist of a capitalist, a member of the 1% a member of the 99%, or add even more tentacles to the Vampire Squid.

Consider this: One of the ironies of the Smith Goldman "dis" is that neither Warren Buffett, his compatriot in calling out Wall Street greed, or JPMorgan, Goldman Sachs' peer company, would likely hire him, the latter being an opinion expressed by Bloomberg's William Cohan on Tuesday, who called Smith "toast" as far as all of Wall Street is concerned.

Buffett is famous for deriding the same "toxic and destructive" nature of Wall Street called out by Smith, just not specifically when it comes to Goldman. Which one of them is right? The right answer might still be both of them, and it's just that Goldman's tentacles will always have the longest reach.

-- Written by Eric Rosenbaum from New York.

>To contact the writer of this article, click here: Eric Rosenbaum.

>To follow the writer on Twitter, go to Eric Rosenbaum.

Follow TheStreet on Twitter and become a fan on Facebook.
3 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

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
Stocks Under $10

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

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

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
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free
GS $159.59 -0.30%
AAPL $93.21 -0.44%
FB $117.80 -0.22%
GOOG $701.26 0.80%
TSLA $211.34 -5.00%


Chart of I:DJI
DOW 17,660.71 +9.45 0.05%
S&P 500 2,050.63 -0.49 -0.02%
NASDAQ 4,717.0940 -8.5450 -0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs