Goldman Loses $2.2B After Scathing Op-ed

Goldman Loses $2.2B After Scathing Op-ed

Posted By: Jordon [Send E-Mail]
Date: Friday, 16-Mar-2012 18:21:05

. Goldman Sachs Group Inc. saw $2.15 billion of its market value wiped out after an employee assailed Chief Executive Officer Lloyd C. Blankfein's management and the firm's treatment of clients, sparking debate across Wall Street. The shares dropped 3.4 percent in New York trading yesterday, the third-biggest decline in the 81-company Standard & Poor's 500 Financials Index, after London-based Greg Smith made the accusations in a New York Times op-ed piece. Smith, who also wrote that he was quitting after 12 years at the company, blamed Blankfein, 57, and President Gary D. Cohn, 51, for a "decline in the firm's moral fiber." They responded in a memo to current and former employees, saying that Smith's assertions don't reflect the firm's values, culture or "how the vast majority of people at Goldman Sachs think about the firm and the work it does on behalf of our clients." Former Federal Reserve Chairman Paul Volcker, 84, whose "Volcker rule" would limit banks like New York-based Goldman Sachs from making bets with their own money, called Smith's article "a radical, strong" piece. "I'm afraid it's a business that leads to a lot of conflicts of interest," Volcker said at a conference in Washington sponsored by the Atlantic. Goldman Sachs slid $4.17 to $120.37 yesterday. The shares are still up 33 percent this year. David Wells, a spokesman for Goldman Sachs in New York, declined to comment beyond the contents of the memo and an earlier e-mailed statement in which the firm said it disagrees with the views expressed in the op-ed. Read more: http://www.readersupportednews.org/news-section2/320-80/10467-focus-goldman-loses-22b-after-scathing-op-ed