From the New York Post:
Goldman Sachs CEO Lloyd Blankfein has warned his employess to avoid making big-ticket, high-profile purchases as the gold-plated Wall Street firm hunkers down amid a firestorm of public and political anger over outsize bonus payments.
According to sources at the bank, Blankfein has told Goldman staff that spending should be toned down in light of the billions in bailout money that banks, including Goldman, have gotten from Uncle Sam.
A source within the bank said Blankfein first began calling for an end to the conspicuous consumption late last year, but has stepped up his campaign in recent weeks as the White House has sought to rein in compensation and as the firm has gotten dinged by a pair of high-profile magazine articles.
"This is a sensitive time for us, and [Blankfein] wants to make sure that we're not being seen living high on the hog," said one Goldman exec.
Indeed, the exec said that senior managers were ordered to tell their staffs that just because Goldman made a record second-quarter profit of $2.3 billion, they shouldn't bank on getting a fat bonus just yet. Blankfein was quoted as reminding staff that bonuses are based on full-year results, and that the year is far from over.
Blankfein's admonishing of workers about profligate spending comes as the firm has been hit with a barrage of negative press lately over its uncanny ability to make money not only in the best of times -- but also the worst.
A Rolling Stone article referred to the firm as "a great vampire squid wrapped around the face of humanity," while a recent New York magazine piece floated the idea that Goldman benefited from the rescue of troubled insurance giant American International Group.
A spokeswoman declined to comment.
Goldman's speedy recovery in the wake of the global recession and the demise of many of its rivals has drawn more outrage than awe.
Observers question everything from the bank's massive pay to its uncanny ability to serve as a incubator for Washington policymakers. Goldman alumni include former Treasury Secretaries Henry Paulson and Robert Rubin, and Jon Corzine, the current New Jersey governor and former US senator.
Goldman accepted $10 billion in rescue funds from Uncle Sam to help it stay afloat last year amid a crisis of confidence on Wall Street but quickly repaid the money thanks to record revenues.
The Goldman exec said that while Blankfein was cajoling workers to cut back on their spending to avoid negative publicity, he was also playing cheerleader.
In a company-wide voice mail left last week, the CEO assured employees that management is "focused on addressing the negative news and that [Goldman] remains committed to integrity and excellence."
"I know you're all working hard," he added.
If this seems familiar, perhaps you're recalling the scene from Goodfellas in which Robert De Niro admonishes his crew members for going on spending sprees following their big Lufthansa heist. For your enjoyment:
