Goldman CEO Tells Employees to Tone Down Spending
Goldman Sachs CEO Lloyd Blankfein is telling employees of the powerful bank to avoid displays of conspicuous consumption, the New York Post reports.
(AP Photo/David Karp)
Goldman has faced a spate of bad press of late, including a Rolling Stone article casting it as "a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money" and a New York magazine piece asking if the company is "evil." (See "The Shine Comes Off Of Goldman Sachs" for more.)
Blankfein appears to be trying to stem the tide by convincing employees to keep a low profile – and maybe put off buying that fancy new mansion until the economy has improved.
"This is a sensitive time for us, and [Blankfein] wants to make sure that we're not being seen living high on the hog," a source told the Post.
Goldman quickly repaid the $10 billion in government aid it received directly from the government. But it also helped orchestrate the AIG bailout that resulted in a $13 billion infusion into the company not long after a Goldman competitor, Lehman Brothers, was allowed to die. The company is now reaping record profits – $2.3 billion in the second quarter alone.
Spurred by outrage over outside bonuses paid at companies that were bailed out by the government, Washington is now considering limits on executive pay.
Goldman's total bonus pool in 2008, when the current economic crisis was in full swing, was $4.82 billion, according to a report last week from New York Attorney General Andrew Cuomo. More than 953 employees were reportedly paid more than $1 million.
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