Profile of GS

OK, so GS can be compartmentalized into 2 different FDIC-insured banks (one a depository institution, the other a trust company), a broker-dealer business, and an investment banking business (which in my mind encapsulates its private equity operations). There may be other business lines that don't fall into one of these aforementioned compartments that I haven't yet discovered.

I'm going to harp on the financial institution at first in my analysis. It's part of "peer group 1" which the FDIC defines as banks with more than $3B in assets. There are 177 banks in this peer group. The address of the overall headquarters is 200 West Street New York, NY 10282 and its website is http://www2.goldmansachs.com/ . It was founded in 1869.

OK, so its regulators are a hodgepodge of government agencies, being that their structure is a hodgepodge of operations. FDIC regulators are not its main regulator, though FDIC does regulate its retail depository institution and also its trust company. It's main American regulators are the Federal Reserve and the SEC. Its trust company is regulated by the OCC. A good website that summarizes many of the changes of its structure as a result of the financial bank bailout is http://www.thesunshinereport.net/marksunshine/?cat=81. I do not know yet what other nations may regulate GS, if at all.

Here are some financials on the FDIC insured depository bank from the FDIC website.

                 Total Avg Assets    Total Deposits        NI          Total Equity
12/31/08   67,369                    45,049                 (250)       18,677
3/31/09     161,249                  52,227                 1,209       19,878
6/30/09     155,574                  35,544                 1,686       20,367
12/31/09   111,394                  32,727                 3,677       22,373
3/31/10     93,739                    31,278                 524          22,895
6/30/10     90,966                    30,398                945           23,324
9/30/10     96,588                    31,596                1,247        23,627
12/31/10   95,483                    32,306                1,199        23,775
3/31/11     88,594                    32,281                 317          19,097

Its CEO, President, Chairman, COO, CFO, Directors, and Senior Execs can be found at
http://www2.goldmansachs.com/our-firm/our-people/leadership/board-of-directors.html#ClaesDahlbäck
I hope to look into each one of these individuals' biographies to get that much more a detailed understanding of the institution.

Estimated number of employees according to its website is 1,892.

Its business principles are found at http://www2.goldmansachs.com/our-firm/our-people/business-principles.html%20It's . It's a rather lengthy list of principles. I find it a little interesting that GS doesn't do the whole vision and mission statement thing. Though the first of its list of principles is highly suspect from what  I have read about its dealings in the mortgage backed securities market in the runup to the financial crisis of 2007-2008, "Our clients' interests always come first. Our experience shows that if we serve our clients well, our own success will follow."

Even lengthier than its list of principles is its length of products/services offered. Here's the list: advising in environmental markets and mergers and acquisitions, bank loans, financing of commercial mortgage capital, debt financing, financing in equity capital markets, lender financing, public sector and infrastructure financing, specialty lending, urban investments, asset management, bank deposits, closed ended investments, direct private investing, mutal funds, private wealth management, managed accounts, securitised products, structured fund solutions, securitised derivatives, clearing services, execution services, fund administration, pensions, endowments and foundations, prime brokerage, securities lending, transition services, global investment research. There are services tailoredfor individuals, institutions, investment advisors, and hedge funds.
You can find information about each on its website I already provided above. Lastly, I intended to post information regarding rates offered by GS Bank, but there is no information online. I imagine I'd have to call them to get deposit and loan rate information, but I figure it's not worth it. They probably offer extremely competitive rates.

A thought before I post a profile of GS

Before I begin running down a shabby profile of GS, I want to give the url to this msn article about GS: http://www.msnbc.msn.com/id/43931226/ns/business-us_business/ . In short, it talks about the supposedly shady practices of GS in one of its new businesslines, warehousing of aluminum! I don't think there is in fact any shady practice (though I haven't read the facts, if there are even any) but I know it is in the right of any company to diversify into other businesses. To me, it's a vertical expansion because not only have they been in the aluminum trading business but they are now also in the aluminimum warehousing business. Good for them, I guess. This leads me to another point I have been forming in my head for months (years?). Financial intermediaries bring buyer and seller together more efficiently than ever before, but in the past when financial intermediaries weren't so efficient the incongruities would lead to profit and loss to be taken by actual buyers and sellers and now these instances of possible profit or loss have been seized by financial intermediaries. Let me illustrate, take aluminum markets for example, in the past with a less efficient system, buyers and sellers would have be price the materials and negotiate very well, if not either one could take a loss and the other a profit. Now, because of more efficient financial intermediaries, prices and negotiated much better consistently, therefore the buyers and sellers are no longer exposed to the risk of mispricing. Remember though without risk there is no profit. The efficiency leads the financial intermediary to benefit from fees for its services. I wonder if the efficiency of financial intermediaries is even needed nowadays, especially in lieu of considerable technological advancements which could probably allow the buyers and sellers to perform just as good a job of price discovery as the financial intermediaries.

Why I am to do an analysis of GS Group, Inc.

As a finance buff and graduate student in finance, I personally feel that GS represents the pinnacle of finance. Both extremely admired and abhorred, this institution is many things to many people. I aim to demystify this corporation, utterly understand its operations, and demonstrate my knowledge via postings that will include not just prose but more importantly mathematics. Moreover, I intend to embark on quantitative and qualitative analysis on its fundamentals and its technical stock indicators. By doing so, I feel that I will be able to demonstrate not just my knowledge of GS but indeed my knowledge of the world of high finance.

I would like to add some thoughts I've had in the last day and half, since I have began this blog. First, I've thought "How do I blog? Should it be extremely well written essays or just speed of thought type postings?" I've concluded that it should be the latter. I think it fits the forum better. Second, I noticed how many blogs about GS already exist. This got me thinking, that I should be reading up on these blogs so as to be up to date as much as possible with GS. That's fine, I already planned on reading books and articles about GS, but until I saw how many blogs there are on GS, I didn't realize that I need to include blogs to my reading list.

I've done some premature analysis on GS so far. This shall be the content of my next post. I don't plan on refining my thoughts on my findings as I dig through the mountain of information there is on GS and its industry. Rather, I plan on posting my work as is as soon as I get it done.

Until next time.