At Goldman Sachs, It's Mostly $100 Million Days

On three out of every five days this year, Wall Street's leading firm has made at least $100 million trading stocks and bonds, and creating and entering into derivatives contracts.

Out of 194 trading days through the end of September, Goldman Sachs earned at least $100 million from its trading division on 116 of them. The firm lost money from its trading activities on just one day during the three-month period ending in September, federal regulatory filings show. It made at least $50 million on four out of every five trading days.

The documents show just how much of a trading firm Goldman Sachs has become since the financial crisis mushroomed in September 2008. The firm generated about $4.5 billion in pre-tax earnings off trading and investments during the third quarter, compared to a $761 million loss in the same period last year.

Source: Zero Hedge

Income from other segments of the firm has dropped. Through the first nine months of the year, the firm earned about $1.3 billion off investment banking and managing assets for clients; during the same period last year the firm earned $3.7 billion from those same activities.

As the influential financial blog Zero Hedge puts it: "When a firm's trading performance challenges not only all preconceptions of realistic trading, but also of statistical distributions, one can merely stand back and watch in awe."

Comments

[Cactusman]

03:11 PM on 11/08/2009

I'm no financial genius in the vein of Wall Street, but I manage my own life's finances quite well. Therefore forgive me when I say that I do not understand how what Goldman-Sachs does really helps anything in the real economy, the one you and I must live in. They don't produce anything of use or value to the average human, mostly skim off of the top of international monetary trade. They exist almost entirely to control and benefit from managed financial scarcity and surpluses, depending upon the mood of the people who actually buy, sell, make, produce, and do things.

Oh, I am sure that as with many things, the financial sector does do something useful every now and again; but that's kind of like saying that a serial killer dotes on his pet dog when he's not out claiming other victims elsewhere.

On balance, I think that today's Wall Street titans probably do more harm than good to our society, particularly when the whole system is rigged to offer them increased power over the entire economy and political process at the expense of the "base" of the food chain, us! Plankton can survive without whales to eat them, but not the reverse.

[Stop the bail]

12:18 PM on 11/06/2009

Woo hooo I love job less recoveries..10.2% unemployment and the stock market is up anyway. I'm sure all the millions of unemployed would feel relieved to know the economy is finally growing even if there won;t be any jobs available to them due to outsourcing/insourcing technological efficiency, or greedy employers.
http://financeopinionss.blogspot.com

We need a 2nd stimulus devoted only to JOBS

Stupid re.pukes and Milton Friendmanism keeping it from happening

[Nelson Jacobsen]

09:58 PM on 11/05/2009

Want to laugh until you cry, Go take a look at the state of the muni bonds and what this means for the good ole USA.

[Nelson Jacobsen]

09:56 PM on 11/05/2009

We are not going to see them or anyone really big audited, like the FED, until there is a rebooted government since our government is one of their biggest clients. The financial and government sectors are in this together and the people with their sports teams and tveee shows distractions along with the occasional constriction of what ever they can think of to keep the sheeple in check keeps the whole scam running like top.

[mattyd123]

08:49 PM on 11/05/2009

Goldman love Mel Watts.

http://wallstcheatsheet.com/breaking-news/a-less-than-opaque-look-at-mel-watts-motivations-to-kill-the-audit-the-fed-bill/?p=3361/

[Hysterian68]

05:46 PM on 11/05/2009

Has anyone actually examined Goldman Sachs' books? They seem to make money when everyone else isn't.

Remember Ponzi schemer Bernie Madoff? Is it possible Goldman may have been generating gleaming financial statements for their customers while passing on profits from the accounts of other investors.

So where is the SEC?

[tradethefed]

05:11 PM on 11/05/2009

Goldman and Bank of America run the markets along with Geithner, and beagle boy Ben. There is no free markets, only welfare capitalism and socialism for capitalism.
http://financeopinionss.blogspot.com

[Alux]

03:00 PM on 11/05/2009

This statistic is the best argument I have seen for separating the "casino" operations of national banks and bank holding companies from the operations that have access to Federal Reserve money. Goldman Sachs can now borrow at essentially 0.0% interest and gamble against the backstop of the taxpayers. This is of course an absurd result.

How does something like this happen? Answer - Check out how much GS execs give every year in political donations and how many ex-GS execs and partners serve in key positions in the U. S. government and regulatory agencies.

For all the noise made during the presidential campaign and afterwards about re-regulating the financial industry, has anything actually changed? Jack and Squat.

Hope and same! Yes we can't.

[PlayTOE]

02:17 PM on 11/05/2009

If Goldman is making 100 million a day trading, then someone is loosing that money.

Think about that when entering into the stock market.

[jsarets]

02:49 PM on 11/05/2009

Not true. Goldman is creating that money out of thin air.

There's a huge carry trade going on right now where banks are borrowing from the Fed discount window at zero interest, shorting the dollar, and investing the spread in risky assets.

As long as the dollar keeps weakening consistently, banks can re-leverage at a negative effective interest rate (-20% or so). The Fed is basically paying the banks to invest free money.

So the someone that is losing money is just losing money it creates out of nothing.

While credit is tight for borrowers in the real economy, credit has never been easier for borrowers in the financial economy. This is unprecedented.

But the carry trade depends on a weakening dollar. When the dollar hints at a bottom, the rush to cover short positions will generate a global stampede and a truly epic asset bust.

This next asset bust will make the last one look like a training exercise in comparison.

[PlayTOE]

06:02 PM on 11/05/2009

Not true. Goldman is creating that money out of thin air.
the carry trade depends on a weakening dollar.

Re-read your own explanation. making "free-money" for Goldman by weakening the dollar is quite equal to taking a little out of every pocket. The weak dollar buys less.

There is no free lunch. There is no magic money supply, that money comes from you, and the hard work you do to earn it.

[jdw1981]

02:01 PM on 11/05/2009

This country is now exactly like France when Louis XIV and Marie Antoinette were in charge of things.

Then France's citizenry came to their senses...

[jdw1981]

02:02 PM on 11/05/2009

Typo. I meant Louis XVI

[Jannsmoor]

01:45 PM on 11/05/2009

And not one dime of it actually benefits society. Goldman Sachs is a chartered entity. The American government can write any rules it wishes to rein in this stupidity. What purpose does it serve to have them sucking $100 million a day out of the American economy. Every single American pays more every single day to buy the necessities of life because Goldman extracted those profits, but what do we get in return? Anything? Anything at all?

[theaetetus]

01:32 PM on 11/05/2009

whats good for business is good for you

[pxlpsh]

01:21 PM on 11/05/2009

I get tired of seeing my countrymen fighting amongst themselves while America is being sold out by these corporations.

[pxlpsh]

01:08 PM on 11/05/2009

TO ALL YOU PEOPLE POINTING FINGERS AT REPUBLICANS AND DEMOCRATS ...
IT IS NOT THEIR FAULT..IT IS OUR COMPLACENCY THAT HAS LED US TO THIS POINT.DO NOT BLAME YOUR GOVERNMENT AS PEOPLE GET THE GOVERNMENT THEY DESERVE.WE LET THE CORPORATIONS DO THIS TO US.SHIP OUR JOBS OVERSEAS TO SLAVE LABOR AS WE TOUT FREEDOM,THEN TURN AROUND AND BUY THE IMPORTED GOODS TO SAVE A BUCK WHILE ANNIHILATING OUR INDUSTRIES.THE CORPORATIONS DO NOT CARE ABOUT AMERICA ,NOR DO MOST OF THE POLITICIANS WE VOTE INTO OFFICE.
YOU REALLY WANT TO CHANGE AMERICA ? WORK TOGETHER TO COMBAT THESE LARGE CORPORATIONS WHO SCREW YOU AT EVERY TURN.INSIST ON BUYING AMERICAN MADE PRODUCTS.DON'T BE HYPOCRITES AND COMPLAIN ABOUT LOST JOBS WHILE ONLY SHOPPING AT WAL-MART BUYING CHINESE GOODS.BRING BACK REGULATIONS TO PROTECT US FROM CORPORATOCRACY. GOLDMAN SACHS ALIGNS WITH THE MONEY AND NOT ANY NATION. IT IS UP TO US TO WORK TOGETHER.

[ziploked]

01:13 PM on 11/05/2009

Typing in all CAPS is not only hard on the eyes and annoying to read, it's considered rude email/posting etiquette (an eForm of yelling) as well. Please cease and desist. We can get your point in lowercase just as well

[pxlpsh]

01:15 PM on 11/05/2009

DO NOT CARE!!!

[sonofsamphm1c]

01:06 PM on 11/05/2009

It's easy to accuse Saddam Sachs of front running. To date, nobody has proven a word of it.

It's easy to accuse Saddam Sachs of trading on insider information. To date, nobody has proven it.

They're smart. And they've proven it.

[Clzwld]

02:18 PM on 11/05/2009

Madoff is that you? I've been following your directions to a TeeHeHe$

[sonofsamphm1c]

04:42 PM on 11/05/2009

"Madoff is that you? I've been following your directions to a TeeHeHe$ ..."

This is all you have? That's it?

[DiogenesOfAlaska]

04:25 PM on 11/05/2009

At that market share, the difference between earning the bid/ask spread and front running is beginning to be esoteric. And THAT is the problem.

[sonofsamphm1c]

04:56 PM on 11/05/2009

The two-step dodge.

A deluge of accusations of front running and insider trading, and not one tiny little bit of evidence of wrongdoing by Saddam Sachs. Envy is not evidence. Jealously is not evidence. Hatred is not evidence. Conspiracy rot is not evidence.

They have been caught doing things wrong, and they've paid their fines.