Ph.D. Octopus

Politics, media, music, capitalism, scholarship, and ephemera since 2010

Didn’t Former Goldman Sachs Banker Greg Smith See American Psycho?

with one comment

by David

 Thinking a little more about our friend Greg Smith who just quit his job at Goldman Sachs, it occurred to me that Smith must have a very short memory. He claims that Goldman used to have a “culture” that “revolved around teamwork, integrity, a spirit of humility, and always doing right by our clients.” But when exactly was this? He started at Goldman Sachs 12 years ago, in 2000. But thirteen years before that, in 1987, Tom Wolfe wrote Bonfire of the Vanities (25 years ago now!). Four years later, in 1991, Bret Easton Ellis came out with American PsychoBoth novels parody (or celebrate, depending on your point of view, the arrogance, materialism, and overall douchebaggery of Wall Street. The main character in Bonfire, a white Wall Street trader named Sherman McCoy, thinks of himself as a “Master of the Universe” (and not the He-man variety, which would have been awesome). In American Psycho, the protagonist, investment banker Patrick Bateman, is driven to a psychopathic murderous rampage (or is he?) because intense elitism and douchebaggery of the corporate culture. No humility there. Heck, Oliver Stone’s 1987 film Wall Street, which some capitalists curiously misinterpret as a celebration of the financial sector, is in fact a criticism of the Ayn Rand/Gordon Gekko “greed is good” mentality that was rampant during the 1980s, including, I’m sure, at places like Goldman Sachs.

So yes, the fierce douchbaggery of the financial sector is nothing new, nor is the reputation for pulling a fast one on clients and committing either outright fraud or legal manipulation of unsuspecting customers. Greg Smith should have known that, and could have known that from simply cracking a fun book or watching a fun movie like American Psycho (I doubt there’s an investment banker alive who hasn’t seen that movie). But if the pop culture history isn’t enough, Smith can read this op-ed by William D. Cohan, which documents how

Goldman Sachs has been in and out of trouble throughout its 143 years — chiefly because it chose to put its own interests before those of its clients. What appeared to be a revelation to Smith was actually available to anyone who looked for it, buried deep within Securities and Exchange Commission and court records. Smith could have saved himself grief if he had only used his Stanford education to examine Goldman’s DNA before crossing its threshold.

Cohan’s article, titled “Goldman Sachs’s Long History of Duping its Clients,” focuses on one incident in particular, the June 1970 bankruptcy of Penn Central Transportation Company, the nation’s largest railroad.” According to Cohan, Goldman Sachs has been screwing over clients since at least 1928. I read the article. Now I think I’m gonna buy Cohan’s book, Money and Power: How Goldman Sachs Came to Rule the World. Greg Smith and all the other former and current financiers should probably read it too.

Still, despite my criticism here, let me re-emphasize that I applaud what Greg Smith has done. Even if his op-ed read a bit like a resume, he still did a good thing. Quitting was the right move, and telling people how sleazy Goldman Sachs has become, even if it, like all the other banks and hedge funds out there, have actually been that sleazy all along, is an extremely important message to get out there. It’s especially important coming from the inside. If it inspires others to quit, or to avoid applying in the first place, it will be a greater accomplishment, and a greater mitzvah, than even winning a gold medal in ping pong at the Maccabiah Games.

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Written by David Weinfeld

March 16, 2012 at 21:54

One Response

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  1. […] York and London, telling us how corrupt that company had become in his time there (though in fact the sleaziness goes back much further). Today, we have Toronto’s Globe and Mail journalist Tm Kiladze telling us  why he left a […]


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