A View From Middle England - Conservative with a slight libertarian touch - For Christian charity and traditional belief - Free Enterprise NOT Covert Corporatism

Wednesday, March 14, 2012

Goldman Sachs director quits "toxic bank" for sake of his conscience

Goldman Sachs has its admirers...doesn't it?
Who says we don't have consciences. We all do, but some of us don't let them get pricked, whilst others get them pricked quite a lot. Working in today's banking world must be a hard place for anyone. I've known plenty of people leave employment with banks because they just could not stand it any longer. Their consciences troubled them. Clients may be sold policies they don't need or want (PPI just one type), there are investment "vehicles" that have poor performance and there are other inadequate financial dealings. There used to be an institute of bankers for a level of professionalism. Now the only such body in the UK is The Chartered Institute of Bankers in Scotland. They have an interesting section on "ethical dilemmas" which challenge a person's professional integrity. More biased towards a bank's position that a customer's I feel, though.

Anyway, Greg Smith, who headed Goldman's equity derivatives business in Europe, has resigned because he could no longer work there "in good conscience". He said it was common to hear talk of ripping off their "muppet" clients. "The environment now is as toxic and destructive as I have ever seen it," he wrote in the New York Times. "I knew it was time to leave when I realised I could no longer look students in the eye and tell them what a great place this was to work," he wrote. "It makes me ill how callously people talk about ripping their clients off. Over the last 12 months I have seen five different managing directors refer to their own clients as 'muppets', sometimes over internal email."

Muppets? Of course, Goldman Sachs don't hold with this view. They think it is all neat and dandy in corporate world. One rogue banker? Well, if Mr.Smith is to be believed those emails exist and damningly refer to muppets. Which clients are the muppets? Perhaps that will leak out and Goldman Sachs can start eating humble pie.

A lot of large corporations obtain their business in parasitical ways. They latch onto other companies and just suck cash out for themselves with little or no regard for the integrity of the work done or the value of it for the client. Trenton City Council in New Jersey is just one organisation sitting up and querying what is being bought in its name. It has refused to approve a $42,000 (£26,855) contract for paper products after baulking at its $4,000 charge for paper cups. The National Health Service has been saddled with a bogus computer and there are other tales of woe.

Most companies operate in decent hardworking ways offering customer true value for money. But there are others which operate very close to the wire when in comes to integrity. There seems to be a fine line between legality and illegality for some. Pity.


Your reference to Trenton got my attention even more than your normal, quite good, posts.

I grew up in Hamilton Township, NJ, which borders Trenton. Some of my earliest memories of Trenton are of St. James Episcopal Church, my family's church when I was growing up in the 1940s and 1950s. I also remember lots of times at Trinity Episcopal Cathedral in Trenton when I was growing up. I started learning to swim at the Trenton YMCA in the 1950s. Trenton was far from perfect, as was Hamilton Township, but both were good places with lots of good people.

I left Hamilton in 1963 to attend Rutgers University where I got a degree in physics. Why Rutgers? My father was Rutgers class of 1935, my grandfather class of 1890. I returned to Hamilton and Trenton in 1976 when my career brought me back to the area. I remember working for New Jersey State Government. My hobby of photography got me involved in lots of things. The Episcopal Diocese of New Jersey started taking advantage of my photographic skills. I joined the Trenton Artists Workshop Association. I got to know Trenton Mayor Art Holland -- a Democrat -- and Mercer County Executive Wilbur Mathesius -- a Republican -- through these connections. Both were good men who contributed a good deal to our communities.

i especially remember two New Jersey governors -- Richard Hughes, a Democrat in the 1960s, Tom Keane, a Republican in the 1980s. Both were respected as fine men by people in both political parties.

I can even point people to an entry on my blog, I wrote A Tale of Two Space Days to compare two events with similar themes. I organized the event in Trenton, New Jersey.

I think I can say I know Trenton better than most people. It used to be a good place.

Jon Corzine, former CEO of Goldman-Sachs, and, by that time a U.S. Senator (Democratic Party), became governor of New Jersey in 2006 after a scandal forced the previous governor to resign in disgrace. He lasted one term before he was defeated in a reelection campaign by Chris Christie. Quite a few people thought Corzine was a poor governor.

Now I read, via your blog, that Trenton now has a corruption problem. Art Holland and Wilbur Mathesius would not take such a route no matter what happened. But, then, they were good, if imperfect men.

I hope I haven't gone on too long. Your posting, though, brought back so many memories of a better time it isn't funny.

Thank you, Chuck, for your kind comments. I spotted the Trenton piece because it seemed very similar to lots of others. It appears that the way this sort of thing happens is that items are just put on the order and if they go through it is then considered the amount that is needed. I met a graphic artist in the 70's who said he had to leave a london company because they overcharged companies. they apparently charged BP Oil £5000 for a simple piece of design. It is hoped nobody asks questions. Invariably there are two "ends". The one supplying and the one procuring, who gets a percentage!

Mr Forester, thank you for supporting Ron Paul.. :)

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