Credit Crisis: Could Goldman Sachs really be sold?

Goldman Sachs

#1

They’re talking about it in the city… Goldman could be sold - absolutely unbelievable.

What do you think?


#2

Hard to believe definately. Is it really necessary at this point? They still made a profit this quarter so are times for them really that dire?


#3

HTale - Morgan are talking to CIC, but a merger with Wachovia is more likely in my opinion as it will appease the public. Also, I’ve heard a state owned Chinese bank are buying a large share in Rothschild?


#4

Yes, China Investment Corporation(中金) is quite strong, which is a sovereign wealth fund, backed by China’s rich foreign reserves. Hopefully the crisis will not spread over the whole world.

You know what, Rothschild is very very famous and hyped up by Chinese people because of a book written by a Chinese guy, in which he says Rothschild is the giant bank in the 19th and 20th century.


#5

You’re right, Wachovia is the politically astute option, but will it do anything to curb the downward spiral of confidence in Morgan? I think the management are echoing those concerns, given their preference to the CIC deal. We’ll wait and see, but I have a feeling Morgan will put aside the flag waving and go for CIC.


#6

I can’t really see any potential buyers at the moment, unless a gigantic investment fund from the middle or far east comes along. Importantly though, short selling has been banned by the FSA, which is great news. I think Goldman and Morgan will pull through. I hope.

EDIT: I’ve just read about Morgan considering to sell a 49% stake to China Investment Corp, to curb the rot. I actually think now it’s a realistic possibility that Goldman will follow suit and sell a similar amount of equity to another investment fund.


#7

I’ve not looked at [[Goldman Sach|GS]]'s current figures (I’m not sure there are any published that are recent enough), however after the collapse of [[Lehman Brothers]], [[Bear Stearns]] and imminent collapse of [[Morgan Stanley]], I’m beginning to believe anything could happen.


#8

man this just shows that the market spares no one!


#9

Given GS and MS will be regulated in similar ways as commercial banks, I dont think any of them will be acquired. They might get capital injection by the likes of CIC, but not outright purchase by a commercial bank.

I found Lex article on FT quite useful: http://www.ft.com/cms/s/1/aeaba55e-8880-11dd-a179-0000779fd18c.html

botirvoy


#10

Both [[Morgan Stanley]] and [[Goldman Sachs]] have now converted from investment banks to commercial banks, marking the end of the [[bulge bracket]] banking era!


#11

For me, that’s a shame. There’s always been a venerable feel to those institutions, and I just feel some of that has been taken away now; the thoroughbred model has lost all respect. Do any of you here feel the same way?

It’s a little like Sidney Sussex offering private GCSE and A-level courses due to a lack of funding. No? Well, something to that effect. Although I think I would probably end up killing myself if that ever happened…


#12

I am not worried about the long term future of i-banking. Intelligent and ambitious minds need “home” for their energy and they will find it in whether it is called GS or something else! You also have enormous amount of capital in the system that is trying to find home - it needs i-banks that can facilitate deployment of this capital.

botirvoy