When Goldman Sachs' chief mouthpiece told us a couple of weeks ago that no one at the bank would be permitted to celebrate the firm's blockbuster second quarter, he wasn't kidding. The Post reports today that Goldman CEO Lloyd Blankfein, has instructed all employees of the firm "to avoid making big-ticket, high-profile purchases."
In this week's issue of New York, Joe Hagan pens a long piece about Goldman Sachs, "America's most successful, cynical, envied, despised, and (in its view, anyway) misunderstood engine of capitalism." But if you were thinking that the last year of turmoil—or the unprecedented blow to Goldman's reputation in recent months—has changed things at the storied firm, well, you needn't worry:
Last September, shortly after Lehman had gone bust, Bank of America had just announced plans to acquire Merrill Lynch, and back when the management of Goldman Sachs wasn't feeling nearly as confident as they do these days, Goldman reached out to Warren Buffett for a financial lifeline. The deal Goldman CEO Lloyd Blankfein struck with Buffett gave the firm a big shot in the arm and signaled to investors that Goldman would endure the crisis intact. And it looks like it's working out pretty well for Buffett, too. As of today, Buffett's bet has earned him a paper profit of more than $2 billion. [Bloomberg]
Contrary to what Goldman Sachs mouthpiece Lucas van Pragg told us the other day, it appears Lloyd Blankfein has been celebrating the bank's record quarter after all. Page Six reports today that Blankfein was spotted "celebrating Goldman's boffo earnings" with Assembly Speaker Sheldon Silver at the (kosher) restaurant Prime Grill, although it doesn't say when this dinner supposedly took place, and it's always possible it was another short, bald, Jewish man in a boring suit. (There are a lot of them in this town, as you may be aware.) Meanwhile, Dealbreaker has the details about a dinner that allegedly took place place last night at Barbone, which not only featured Blankfein, but JPMorgan Chase chief Jamie Dimon as well. Barbone's located on Avenue B, which is unlikely territory for both men, but when you're trying to keep your social activities under the radar, you don't exactly book a table at the Four Seasons. Given all these meals, though, we can't help but feel a bit deceived by Goldman's corporate communications department. If there was one industry that has earned a rep for its commitment to honesty, it's investment banking! [NYP, Dealbreaker]
Lucas van Praag, Goldman Sachs' head of corporate communications, was kind enough to get back to us a few minutes ago as to whether Goldman CEO Lloyd Blankfein had any plans to live it up given the firm's blow-out of a second-quarter. Alas, the Dom will not be flowing at Le Cirque tonight, it seems. Says van Praag:
The happiest man in New York today? That would be Lloyd Blankfein, the chairman and CEO of Goldman Sachs, which announced this morning that the bank reeled in a record $13.8 billion in revenue for the second quarter and generated profits of $3.44 billion. It's a big turnaround from a few months ago when the firm was holding out its hand for billions in bailout dollars, of course. But that's water under the bridge. And no one seems to be so sure how Goldman managed to do it. Blankfein attributed the big gains to "the combination of improving financial market conditions and a deep and diverse client franchise" in a news release today, whatever that means. But who cares how Goldman did it? The important thing is to go out and celebrate, right?
If you're in the financial district today and you have some time to spare, artist Geoffrey Raymond is inviting the public to scribble on his latest masterpiece—a portrait of Goldman Sachs chief Lloyd Blankfein—in the alley behind 85 Broad Street during lunch. Sharpies will be provided, as usual. [Dealbreaker, previously]
One of these three teenagers who attended a benefit last week for the Association to Benefit Children at Dylan's Candy Bar—and who appear on New York Social Diary today—is the daughter of one New York City's most prominent and highly paid CEOs. Guess which one—and who her dad is—and you'll find the answer below.
According to Crain's, New York's 100 top-paid executives took home $1.2 billion in compensation last year. And a handful of them, it turns out, are execs who happen to work at banks that received bailouts from Washington: "Number four on the list is Goldman's CEO Lloyd Blankfein, with $42.9 million. Following him is Citigroup's CEO Vikram Pandit, raking in $38.2 million. Jamie Dimon, head of JPMorgan Chase, comes next in line with $35.7 million. Goldman and JPMorgan, which received $10 billion and $25 billion, respectively, in government aid, have recently moved to repay the funds. Citigroup is still saddled with the $45 billion in aid it's accepted." Topping the list, in case you're wondering, is Peter Kraus of Alliance Bernstein, who was paid $52 million just to take the job. But American taxpayers also had a hand in making 2008 a very good year for Kraus: In addition to his take from Alliance, he earned $25 million for the three months he put in at Merrill Lynch in late 2008. [NYP]
Friday morning special: Goldman Sachs chairman and CEO Lloyd Blankfein and his wife Laura have finally put their old apartment at 941 Park Avenue on the market. The couple paid $27 million for an apartment at 15 Central Park West in 2007, and settled into their new digs last year. But the couple's old apartment on Park just hit the market today. The five-bedroom duplex, which is listed with Sotheby's Royce Pinkwater for $15 million, comes with grand foyer, 30-foot living room with wood burning fireplace, paneled library, formal dining room, master bedroom suite with office and two baths, two maid's rooms, and bath and laundry area. Unfortunately, pictures of the co-op aren't online yet. But you can have a look at the floorplan below. [Cityfile]
• Olivia Palermo's imaginary career is on fire. The City star is reportedly leaving her "job" at DVF to "work" in the publicity department at Elle. So if you see anything in Elle that seems to have been ripped from another magazine, now you know who to blame. [P6]
• Jay-Z demanded a Maybach, champagne, "good quality" peanut butter and jelly, 12 shot glasses, and a pack of Marlboros—along with $750,000—before agreeing to perform at the University of Arizona last month. [SG, P6]
• Jesus Luz's dad says his son and Madonna "definitely" plan to tie the knot in a Kabbalah ceremony shortly. But Jesus won't have to bother signing a prenup since the marriage won't be legally binding. [NYDN]
• The good news for Amy Winehouse: She's reportedly no longer addicted to drugs. The bad: She's supposedly traded the drugs for booze. [OK!]
• Man of the people: Goldman Sachs CEO Lloyd Blankfein was spotted flying coach on a flight from New York to DC. [P6]
• Who said the good times are over? On the list of the 10 highest-paid CEOs of 2008: Vikram Pandit, Jamie Dimon, Lloyd Blankfein, and Ken Chenault. [AP]
• Bank of America's board continues to stand by CEO Ken Lewis and has no plans to oust him, says "a person familiar with the deliberations." [WSJ]
• Citigroup is raising some desperately needed cash by selling off its Japanese brokerage and investment units for $5.56 billion. [DB]
And you thought Wall Street was struggling. Goldman Sachs announced a first-quarter profit of $1.66 billion today, a 13 percent bump from what the bank earned during the quarter of 2007. Goldman also announced plans to raise $5 billion via a stock offering so it can pay back Washington the $10 billion it's received in bailout funds thus far. But don't mistake this for a grand civic gesture on the part of Goldman chief Lloyd Blankfein.
Goldman Sachs CEO Lloyd Blankfein addressed the Council of Institutional Investors this morning and addressed the issue of how banks pay their employees, suggesting that Wall Street "apply basic standards to how we compensate people in our industry." (It's unclear if these "standards" would apply to Blankfein personally, who earned nearly $70 million in 2007 and $43 million in 2008.) But you have to give him points for the warm welcome he gave the ladies from Code Pink, who rushed the stage during his speech with a giant sign that said "We want our $$$$$ back."
• President Obama will meet with 15 big banking CEOs in Washington today, including Vikram Pandit of Citigroup, Jamie Dimon of JPMorgan Chase, and Lloyd Blankfein of Goldman Sachs. Obama plans to "quiz" them "about developments in the economy and their businesses." Sounds like fun. [CNN]
• Hedge fund managers can expect a lot more oversight in the future, which isn't something they're too excited about, not surprisingly. [Reuters, NYP]
• Andrew Cuomo says he now plans to widen his investigation of AIG. [DB]
• Many of the AIG execs charged with preventing the insurance giant from taking on too much risk still have jobs at the company for some reason. [WSJ]
• The exodus of Merrill bankers from Bank of America continues. [DJ, DB]
• Swiss private banks are banning top execs from traveling abroad for fear they will be detained as part of a crackdown on bank secrecy. [Reuters]
• Hong Kong billionaire Li Ka-Shing says it's time to start buying stocks and real estate again. Make of that what you will. [NYT]
The CEOs of eight big banks appeared on Capitol Hill today to take a beating before the House Financial Services Committee. Not surprisingly, members of the committee spent much of the day squeezing in bits designed to earn points with constituents, an amusing reminder that the only thing worse than Wall Street chief executives taking taxpayer dollars to lavish them on employees are semi-literate Washington bureaucrats in cheap ties looking to score airtime on KWCH in Wichita.
• Details about the Obama administration's plan to revise the bailout are still sketchy, but more will be revealed by Tim Geithner tomorrow. [WSJ, BN, DB]
• UBS is slashing bonuses by 80 percent, but the bank says it does not have plans to get out of investment banking altogether. [BN]
• Barclays announced that quarterly profits exceeded analysts' estimates. [BN]
• More trouble for Bill Ackman's Pershing Square Capital. [DB, NYP]
• Goldman chief Lloyd Blankfein addresses what went wrong on Wall Street in a op-ed piece for the Financial Times. [FT, FT]
• Sunday's New York Times, meanwhile, provides an account of what went wrong between Merrill's John Thain and BofA's Ken Lewis. [NYT]
It's been a rough stretch for every banking CEO, and Goldman Sachs chief Lloyd Blankfein is no exception. While he did very well for himself in 2007—he took home a total of $67 million—he opted to forgo a bonus in 2008, and the $465 million in Goldman stock he owned at the beginning of 2008 was worth just $127 million by the end of the year. This probably explains why Blankfein's charitable contributions for 2008 fell off a cliff, too. In 2007, the Lloyd & Laura Blankfein Foundation handed out more than $1.5 million to more than three dozen charity groups. In 2008, the number dropped to $643,000. Almost every non-profit took a haircut: In 2007, for example, Blankfein and his wife gave more than $240,000 to Ethical Culture-Fieldston; in 2008, the number fell to just $45,000. But there were also a number of charities that were dropped altogether, such as the Robin Hood Foundation, which collected $390,000 from the Blankfeins in 2006 and $500,000 in 2007, but got zilch in 2008. The really grim news? Blankfein's foundation was only reporting contributions through January 2008, when the financial crisis was just beginning, which suggests much bigger drop-offs are yet to come. A look at the Blankfeins' contributions from 2006, 2007 and 2008 after the jump.
The World Economic Forum kicks off tomorrow in Davos, Switzerland, but it won't be nearly as exciting as in years past: The financial crisis has led many CEOs and politicians to abandon plans to attend the conference of heavy-hitters. Goldman Sachs chief Lloyd Blankfein won't be there, although he's reportedly sending "his deputy." Former Lehman CEO Dick Fuld won't be there, of course. Nor will John Thain, who, rather ironically, was scheduled to participate on a panel entitled "The Bank of the Future." And while Citigroup is still sending five executives, the bank's chief, Vikram Pandit, isn't one of them. (Citi isn't sending a "support staff" this year either, which means the execs who do make the trip may be forced to carry their own briefcases and fill up their own glasses of water.) Worst of all? There won't be too many celebs on hand to divert attention away from the depressing, gloomy discussions of economic doom.
