Goldman Sachs Group Inc.

  For decades, Goldman Sachs was the firm that other Wall Street firms loved to hate. It housed some of the world's biggest private equity and hedge funds. Its investment bankers were the smartest. Its traders, the best. They practically minted money.

  When the housing bust began to take its toll on Wall Street, Goldman seemed to be the firm best positioned to weather the storm.

  In 2007, a year when Citigroup and Merrill Lynch cast out their chief executives, Goldman booked record revenue and earnings and paid its chief, Lloyd C. Blankfein, $68.7 million - the most ever for a Wall Street C.E.O.

  And as 2008 progressed, Goldman appeared to persevere through deepening economic crisis that consumed rivals Lehman Brothers and Merrill. In September, the company reported modest, though diminished, profits for the third quarter, beating expectations.

  But the company was not invincible as the credit crisis escalated later that month. American International Group, an insurance giant facing collapse due to its exposure to the mortgage crisis, was Goldman's largest trading partner. When A.I.G. received an emergency $85 billion bailout from the federal government, jittery investors and clients pulled out of Goldman, nervous that stand-alone investment banks - even one as esteemed as Goldman - might not survive. Company shares went into a free fall.

  On Sept. 21, in a move that fundamentally changed the shape of Wall Street, Goldman and Morgan Stanley, the last major American investment banks, asked the Federal Reserve to change their status to bank holding companies. Goldman would now look much like a commercial bank, with significantly tighter regulations and much closer supervision by bank examiners from several government agencies.

  The radical shift represented an assault on Goldman's culture and the core of its astounding returns of recent years.

  Yet not everyone concluded that the Goldman money machine was going to be entirely constrained. Days after the firm's shift to commercial-bank status, Berkshire Hathaway, the conglomerate led by Warren E. Buffett, made a $5 billion investment in the firm, and Goldman raised another $5 billion in a separate stock offering. What the new Goldman Sachs will look like, however, remains to be seen. (Oct. 12, 2008)

编辑/发表时间:2009-03-19 17:27
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