In the update to this post from yesterday, I linked to the much-read oped by Greg Smith, a former Goldman Sachs exec director. Smith’s resignation letter is a scathing description of the devolution of GS’s culture from serving clients to enriching the firm itself. I can’t speak to facts of the case but the piece resonated and was somewhat corroborated by Paul Volcker, a venerable veteran of financial markets (though Volcker’s point was about more than GS—as with his eponymous rule, he stressed that when banks trade their own books, conflicts of the type Smith wrote about are endemic).
The point I wanted to make here is about the research economists group at Goldman. These are the folks who publish daily newsletters for clients not about trades in financial markets, but about the real economy, GDP, employment, prices, trade, fiscal and monetary policy, etc.
You’ve seen me cite their work many times on these pages and I will continue to do so. They provide top-notch analysis, clearly explained and presented, on the most important topical issues. I’m not a client of GS, but I’d say that this team serves their clients well.
That doesn’t contradict Smith, btw. It’s just not throwing out the baby with the bathwater.