Goldman Sachs Posts Third-Quarter Loss

[TomClash]

Source: Bloomberg

Goldman Sachs Group Inc. (GS) reported its second quarterly loss in 12 years as the firm lost money on investments and revenue from trading, asset management and securities underwriting declined.

The third-quarter loss of $393 million, or 84 cents per share, compared with a profit of $1.9 billion, or $2.98, a year earlier, the New York-based company said today in a statement. The average estimate of 26 analysts surveyed by Bloomberg was for an 11-cent loss per share, with estimates ranging from a $1.02 loss to a $1.22 profit.

Chairman and Chief Executive Officer Lloyd C. Blankfein, 57, has tied Goldman Sachs’s fortunes to trading, which accounted for 53 percent of first-half revenue, and gains on the firm’s stakes in companies and real estate, which made up 20 percent. Declines in assets ranging from equities to mortgage- backed bonds in the third quarter led to lower trading volume and markdowns of the firm’s own investments.

The third quarter “was a very challenging trading quarter and subsequent quarters are likely to be a repeat given the current market environment,” Jon Fisher, a portfolio manager at Fifth Third Asset Management in Minneapolis, which has about $16 billion under management, said before the results were released. “Any positive comments made regarding the near-term trading environment are unlikely to be believed.”

<snip>

The company, which said in July that it planned to cut about 1,000 jobs to reduce annual costs by $1.2 billion, said it employed 34,200 people at the end of September, down 1,300 from the end of June.

Read more: http://www.bloomberg.com/news/2011-10-18/goldman-sachs-posts-third-quarter-loss.html

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There's more to come between now and Christmas.

[wordpix]

1. maybe people are catching on - trading with corrupt liars/thieves hurts the bottom line

[formercia]

2. I bet they still get their bonus

for trying to get a bigger bonus.

[Jello Biafra]

3. Guess they need to create another Wall St. crash....

to get their profits higher.....

[valerief]

4. Yep, and it's coming. They'll do whatever they can for the almighty dollar.

Making rich people richer is the most important thing in the world.

[GliderGuider]

6. It's coming no matter what they do.

They may be able to make a short-term profit, but the tidal wave is coming over the next 6 months. It's already baked in the cake.

These guys are developing a pretty good track record as prognosticators:

Global systemic crisis – First half of 2012: Decimation of the Western banks

As anticipated by LEAP/E2020, the second half of 2011 is seeing the world continuing its unstoppable descent into global geopolitical dislocation characterized by the convergence of monetary, financial, economic, social, political and strategic crises. After 2010 and early 2011 which has seen the myth of a recovery and exit from the crisis shattered, it's now uncertainty that dominates the States’ decision-making processes just like businesses and individuals, inevitably generating increasing apprehension for the future. The context singularly lends itself: social explosions, political paralysis and / or instability, return to the global recession, fear over banks, currency war, the disappearance of more than ten trillion USD in ghost-assets in three months, widespread lasting and rising unemployment...

Besides, it’s this very unhealthy financial environment that will cause the "decimation (1) of Western banks" in the first half of 2012: with their profitability in freefall, balance sheets in disarray, with the disappearance of trillions of USD assets, with states increasingly pushing for strict regulation of their activities (2), even placing them under public supervision and increasingly hostile public opinion, now the scaffold has been erected and at least 10% of Western banks (3) will have to pass that way in the coming quarters.

In fact, it will be a triple decimation (5) culminating in the disappearance of 10% to 20% of Western banks over the next year:
. a decimation of their staff
. a decimation of their profits
. and lastly, a decimation of the number of banks.

It will be accompanied, of course, by a drastic reduction in their role and importance in the global economy and directly affect banking institutions in other regions of the world and other financial operators (insurers, pension funds ...)

The issue is a bit bigger than whether the vampire squid will get one last suck on its blood funnel.

[Roland99]

5. Egan-Jones downgrades GS from AA to AA-

http://www.zerohedge.com/news/egan-jones-downgrades-goldman-aa-aa

[AlbertCat]

7. OH MY GOD! Not AA-!

What next??? AA+-? AA--? Then we get to A? B must mean bankrupt.

[sarcasmo]

8. Kick!