New York: Most of Wall Street, and the US, is still waiting for an economic recovery. Then there is Goldman Sachs.
Up and down Wall Street, analysts and traders are buzzing that Goldman, which only recently paid back its government bailout money, will report blowout profits from trading on Tuesday.
Analysts predict the bank earned more than $2 billion (Rs9,880 crore) in the March-June period, thanks to its trading prowess across world markets. If they are right, the bank’s rivals will once again be left to wonder exactly how Goldman could have rebounded so drastically only months after the US’ financial industry was shaken to its foundations.
The obsessive speculation has already begun, along with banter about how Goldman’s rapid return to minting money will be perceived by lawmakers and taxpayers who aided Goldman with a multibillion-dollar cushion last fall. “They exist, and others don't, and taxpayers made it possible,” said one industry consultant who, like many people interviewed for this article, declined to be named for fear of jeopardizing business relationships.
Startling, too, is how much of its profits Goldman is expected to share with its employees. Analysts estimate that the bank will set aside enough money to pay a total of $18 billion in compensation and benefits this year to its 28,000 employees, or more than $600,000 per employee.
Goldman declined to comment over the weekend, pending its Tuesday earnings report.
But if the analysts are right— and given the vagaries of Wall Street trading, any hard forecast is little more than a guesstimate—the results will extend a remarkable run for Goldman that was marred only by the single quarterly loss last fall of $2.12 billion.
©2009/THE NEW YORK TIMES