uti.is 15 Mar 12: Who were the “muppets” of the Icelandic banks?

Today, Greg Smith, a Goldman Sachs employee in London, suddenly shot to fame, at least in the banking world. He is leaving Goldman because he thinks its environment is “toxic and destructive.” But instead of just leaving in silence he penned a resignation letter as an Op Ed piece for the New York Times, published today, on his last day at work. It might well have been the most read serious piece in the media today.

He’s uncomfortable with the bank’s business ethics: Goldman sees nothing wrong in selling junk and rubbish to its clients, making the clients lose while the bank makes money. ....   “Over the last 12 months I have seen five different managing directors refer to their own clients as “muppets,” sometimes over internal e-mail.”

Now, it’s normal in business that some lose, others gain. But, as Smith points out, it’s interesting if there is a pattern to it and if a bank thinks nothing of clients’ predictable losses. One of the striking thing about the Icelandic banks is to consider who lost and who profited. Or, in the Goldman thinking, who were the muppets? ...

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read Sigrun's blog here

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