Goldman Only Lost Money Trading One Day Last Quarter

The credit crackup hasn’t been all bad, believe it or not. Goldman Sachs (GS) disclosed yesterday that its trading operation only lost money one trading day last quarter, en route to generating $6 billion in net income. How did Goldman manage that? Simple. It stayed solvent:

Goldman’s ability to reap large profits – its trading operations had net income of $6bn during the third quarter – without ramping up risk underlines the changing nature of trading on Wall Street.

After taking large bets with their own capital prior to the crisis, several banks have now taken advantage of reduced competition, higher margins and government-provided liquidity to make money in less risky activities. Goldman doubled its trading profits in credit from $1bn in the second quarter to $2bn in the third quarter and also increased profits in equities by about 25 per cent to $3.4bn, according to the filing. [Emph. added]

This probably isn’t the “new era” Liz Warren has in mind.

Rule 1 for the next crisis: Manage to stay in business, somehow...

Rule 2: Refer to Rule 1...

Comments

[WD216:]

1 trading day of loss in the quarter out of 62 days just proves that the market is fixed and GS is the beneficiary as they rob the American people.

Nov 05 04:03 PM

[Big Papi:]

I bet your one of the Obama supporters who says how great he is cracking down on big business and then rather than bashing him for this supposed "market fixing" you bash the company. Go read rolling stone they have a great knowledge of finance ya jerk.

Nov 05 05:16 PM

[Alan Young:]

Rule 1: Get the government to help you stay in business.
Rule 2: Make sure your competitors don't.

Nov 05 09:28 PM

[WD216:]

Big Papi.....Read Rolling what? Number one dumbass....You shouldn't assume. Number two....I didn't say the government is not at fault here, I simply stated that GS has robbed the American people. The root of the entire problem is the government, plain and simple.

FYI...I voted for McCain

Next time don't assume, you just make an ass out of yourself.

Nov 06 08:05 AM

[pedrom727:]

This has to be insider trading or some version of it, I don't care how much of a genius you are. 62 trading days with a single day of loss is IMPOSSIBLE. I'm glad they're making great bonuses and pumping up this market with their friends while we backstop their risk taking when it eventually collapses, of course by then they've already gotten out with their money and have no liability.

Nov 06 12:20 PM