$Stock*Shop*Charts*News*Option$

[Stock Lobster]

“I predict Goldman will go private by the end of the year”

There's a fair chance that Barclays would move its legal home to Dublin or Amsterdam, Standard Chartered would up sticks to Singapore and HSBC could relocate to Hong Kong. (BBC)


22 January 2010
eFinancialCareers UK

Becoming a private partnership suddenly looks more appealing. Not only would it allow Goldman to escape the Volcker Ruke (which applies only to “banks” as defined in US law), it could deflect public attention and remove the need for bomb sniffing dogs to check the premises while results are being announced.

Douglas Kass, general partner of hedge-fund firm Seabreeze Partners Management predicts a return to privacy is imminent: “Sick of the unrelenting compensation outcry, government jawboning and associated populist pressures, Warren Buffett teams up with Goldman Sachs to take the investment firm private. The deal is completed by year end,” he suggests.

In reality, a return to private partnership could starve Goldman of capital. So too, as Zero Hedge points out, could a move away from becoming a bank holding company.

In the absence of any clever moves, analysts at KBW think that $8.4bn of Goldman’s revenues are at risk (19% of KBW’s 2010 estimate), along with $3.7bn (21.6%) of pre-tax earnings, and about $4.27/share (23.1% of “core” estimate) of earnings.

Until Obama’s bomb, Goldman was sounding quite chirpy. In yesterday’s conference call David Viniar suggested the firm would be increasing headcount by up to 10% this year, with predictable emphasis on “emerging economies.”

No real indication that France and Germany will follow the Obama plan. (Financial Times)

The lack of global co-ordination potentially opens up the prospect of widespread future regulatory arbitrage. (Reuters)

In the fall of 2008, Lehman Brothers wasn't a bank. Neither was Bear Stearns. Or Goldman, Morgan, or Merrill Lynch. Or Fannie or Freddie. Or AIG. (Business Insider)

The White House background briefing is that their proposals would freeze biggest bank size “as is.” (Baseline Scenario)

Several financial executives are contemplating attempting to buy out Merrill Lynch, (Business Insider)

In our view, dedicated prop trading historically could have been as much as 20% of trading revenues at investment banks. (Alphaville)

TARP was nothing, TGLP is the real deal. (Pragmatic Capitalist)

Some Democratic funders have threatened to start demonstrating with “pitchforks (plastic!)” – unless the government showed that it was willing to take on the banks. (Financial Times)

Foreign banks with proprietary trading operations would be caught by the US reforms. (Financial Times)

The single best thing we could do for financial reform: Triple the budgets of all financial regulatory agencies. Immediately. (Economics of Contempt)

Negative incentives to earn more at BofA Merrill. (Dealbreaker)

Average Goldman pay in 2009 was $498,246. That’s down from the record $661,490 in 2007. (Bloomberg)

A small group including co-chief executives, Richard Gnodde and Michael Sherwood, are understood to have taken most of the hit for the UK bonus tax. (The Times)

Goldman Sachs – lifestyles of the subsidized and anonymous. (Gawker)

Women rate an incredible 80% of guys as worse-looking than medium. (OKCupid)

http://news.efinancialcareers.co.uk/newsandviews_item/newsItemId-23346