Op-Ed Cost Goldman Sachs $2.15 Billion Yesterday

http://www.theatlanticwire.com/business/2012/03/op-ed-cost-goldman-sachs-215-billion-yesterday/49925/

Reuters
Alexander Abad-Santos 1,747 Views 8:54 AM ET

Greg Smith’s unflattering glimpse into Goldman Sachs’ corrupt culture triggered a financial blow to the firm Wednesday, as the company lost $2.15 billion of its market value, making Smith’s 1,283-word op-ed worth a whopping $1.675 million per word.

Goldman Sachs, as Bloomberg reports, saw it shares drop 3.4 percent in trading Wednesday. Even those in the company felt its impact, as one unnamed Goldman Sachs employee told The New York TimesDealbook that Smith’s op-ed landed “like a bomb”— a bomb that spurred an internal (and very PR-friendly) memo from CEO Lloyd Blankfein.  “[O]ur response is best demonstrated in how we really work with and help our clients through our commitment to their long-term interests.” wrote Blankfein, implicitly addressing Smith’s allegations of Goldman’s “callous” disregard for its clients. “That priority has distinguished us in the past, through the financial crisis and today.”

Eyes will be on Goldman’s stock today (it’s holding steady in Germany for now, reports Bloomberg), and for the year its shares are still up 33 percent despite Wednesday’s losses. As for Smith? Dealbook talked to a recruiting exec about his newfound fame. “There is a rule of thumb when interviewing — you don’t bad-mouth your old boss. No one wants to hear it,” Eric Fleming, the chief executive of the Wall Street recruiting firm Exemplar Partners, told Dealbook. “You can argue something like this needed to be said, but if you hire the guy who said it you are taking the risk he will do it again.”

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Posted on March 15, 2012, in Economy / Finance and tagged , , , , , , , , . Bookmark the permalink. Leave a comment.

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