Is There A Liquidity Problem At Goldman Prime?
We received an interesting letter from a reader...
Our Fund tried to do wires out of our GS Prime accounts yesterday. For the first time ever, I got a call asking if “we really needed to wire the money out” and actually had them try to negotiate us out of it. I didn’t think anything of it beyond that.
The thing is, a buddy of mine just told me off-hand that they tried to wire money out of their fund’s GS Prime account too, and they had the same weird attempt to stop the wires…!
Either a) there is a major cash crunch going on (explains DXY up and ECB lending dollars maybe??), b) GS knew market would sell off today and were trying to prevent client margin calls, c) all of the above.
We have sent an inquiry to Lucas van Praag to confirm that all is well with Goldman Prime from a liquidity standpoint. In the meantime, we solicit the response of our readers to indicate if anyone may have experienced comparable "complications" upon redemption events either with Goldman, or other Prime Brokers.
Update: Goldman responds:
We have no idea what this rumor could be about. There are absolutely no issues relating our prime brokerage business, and never have been.
Best / Lucas
So all is good.