Random Thoughts on The City, Wall St & Capitalism

I've never liked Goldman, it always seemed a desperately "worky" place, and really somewhat up itself to boot. This sounds like sour grapes, and it probably is. Let me explain many moons ago,pre-IPO, they turned me down for a job. Of course one is bound to take this stuff personally( think about it, I missed out on free windfall shares), in my case I think it turned to hate.For other people this can have a very positive effect.Look at Lloyd Blankfein http://money.cnn.com/2006/01/23/magazines/fortune/stars_blankfein_fortune_060206/index.htm he runs the place now.The new partners have been announced-there are 400 now, yes they will make a lot of money over the coming years, but spare a thought for the non-partners.That is the majority of the working population in the firm.Last time I looked total headcount was approx 25,600. The other 25,200 don't do that badly, but the majority of it's employees are junior people. VP and below, to be honest for a firm that makes so much cash I was always surprised at how very average the compensation was for most of the worker bees.I wonder if they feel just a wee bit exploited whilst senior management live it up.This attitude is attributed to the fact that there is some kind of special employer brand equity at Goldman that the employee can cash in on later.That's true in the case of Hank Paulson who skipped over to the white house to take over from John Snow as treasury secretary.Although Mr Paulson cannot be described by any stretch of the imagination as a 'brainbox', he is a clever operator.One of the conditions of getting that government job is that he can defer tax on his shareholding in the firm, which I believe is valued around $500 million dollars.Who needs a tax break more than he, there would be an awful lot of tax to pay on that.He's not completely dumb, but then again being the US treasury secretary is not exactly the world's most demanding job. Devalue the dollar without pissing off the rest of the world. It's like PR without the skill.Remember previous incumbents in that office have been known to say things like,"the dollar is our currency, but your problem". Not exactly the words from the mouth of a rocket scientist , nor phrased with the delicacy of language of one holding high office.So the bar is set pretty low as you can see.

In the end I realised I didn't actually want to work there, I just wanted to be on their payroll.I committed the cardinal sin in this industry.Never confuse greed and ambition.

RB