Visualizing Goldman's Epic Meltdown

Tyler Durden's picture

No point in discussing Goldman's abysmal earnings. Here is the chart that says it all.

Total Revenue by Segment - this is the worst quarterly revenue for the firm in years. The biggest loser: Institutional client flow AND Prop (Investing and Lending).

In tabular format.

At least the compenstation expense margin is a nice and sold mid-40%. As for those 35,500 staffers at the end of the period: that's number is going down.

The reason for all of this - the massive collapse in VaR, as Goldman somehow loses its edge which oddly parallels the unwind of the firm's prop trading division... Gee, we wonder why.


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digitlman's picture

Fuck these fuckers.

midtowng's picture

It breaks my heart to see this billionaires not making as much money off the backs of the working class.

RobotTrader's picture

No doubt, after this huge embarrassment, they will be re-ramping up risk again and will resume playing its games by recommending one strategy for their clients and doing the exact opposite for themselves.

Perhaps they sandbagged on purpose since this year is already shot, and now they are setting up for earnings beats the last two quarters just in time for bonus season.

Or maybe Goldman has lost its edge?

Somebody big is short NFLX, AAPL, HOG, WYNN, SINA, etc. and getting killed pre-market.  Maybe Goldman????

bigwavedave's picture

no chance they are short those names..... idiot

LawsofPhysics's picture

"Somebody big is short NFLX, AAPL, HOG, WYNN, SINA, etc. and getting killed pre-market.  Maybe Goldman????"


One can only hope that it is them, but with a direct line to the Fed and treasury, I doubt it.

SheepDog-One's picture

Momofader still thinks its the 2005 cute.

nscholten's picture

What is the big fucking deal with robot trader?  Can one not handle another opinion kind of like in junior high school.  It's fucking retarded.  He or she is just making a fucking statement.  Guess what moron... you don;t have to agree with everything you read, just fucking read it.

gmrpeabody's picture

Please... don't get him started.

treemagnet's picture

SheepDogs reply rants are absolutely nothing compared to the wrath of JW in FL.  Now theres a tire fire you can't put out.

HungrySeagull's picture

Just shovel some dirt onto it and take a lunch break.

i-dog's picture

"......fucking......Can one not handle another opinion......fucking......fucking......moron......fucking......"

Pot, meet kettle. Oh, and eloquently put, too. Sheesh.

grey7beard's picture

>> What is the big fucking deal with robot trader?

The peanut gallery is cat calling from the cheap seats.  Most of these folks can't scratch together a post that even gets a reply, hence they run in little packs to denegrate anyone with enough balls to give an opinion.

Count me in as someone who appreciates reading robo's posts.  Finding thoughful, insightful discourse on these sites is like finding unchewed gum on a New York sidewalk.

Thanks robo, for having thick skin.  Hang in there.

francis_sawyer's picture


I enjoy bitch slapping you as much as the next guy... But I'll admit, you MAY have a point here... (& really - on all of the tickers you nominated)...

Not a bad catch (if you're right)...


SheepDog-One's picture

Well we know when the banks get in trouble and feel the pinch, thats when the bad things happen to the peasantry. Watch out.

Confused's picture

How true. Unfortunately for us.

DeadFred's picture

Lowes is currently restocked with pitchforks. The ten tined bedding fork is quite elegant but for the work at hand I suggest the sturdier manure fork.

DeadFred's picture

Lowes is currently restocked with pitchforks. The ten tined bedding fork is quite elegant but for the work at hand I suggest the sturdier manure fork.

HungrySeagull's picture

In the old Dutch Country they have those in plenty.

SteveNYC's picture

Should wipe a sound 10-20% off Manhattan apartment values come year end. I hear several of the "big boys" on Wall St are having shockers this year. Seems lay offs are coming down the pipe second half '11. Keep an eye out and if you are looking to rent or upgrade in the city the fall/winter is the time.

chdwlch1's picture

So true...your comment reminded me of this quote from a Martin Armstrong article suggesting Goldman is setting up Paulson for the next panic trade.

"We are due for a correction – It’s Just Time. The months ahead are September and November in particular for turning points. What we have to pay close attention to is the "hype" that comes out. If the Investment Bankers are looking to force a liquidation to make a bang-up trade for the year since things have been quiet, the news will be spun to support their agenda. This is part of the game. When they wanted all the little guys in for 1980, they made the Hunts a household name. That was the setup. The little guy buys thinking he is running with the big dogs. The real big dogs stay well hidden in the bushes and will NEVER step into the limelight.

The week before Labor Day (last week of August) may become the key week where a change in trend develops thereafter. Keep in mind, cyclically, most of the biggest periods of volatility take place right after Labor Day. Paulson – you are dancing with the devil. Watch your ass!

So for now, pay attention. The dogs are getting hungry and they have had a quiet year so far. The second half of the year is shaping up for a return to volatility."


LawsofPhysics's picture

Proprietary trading of all types simply provides a mechanism for a select few to steal massive amounts of real wealth from an otherwise healthier economy.  Gee, winding down the prop operations, is goldman doing the right thing or simply exiting to their private island?  Glad to see this either way.

SoNH80's picture

$7.4 billion dollars in revenue a quarter "abysmal"?  Are we supposed to feel schadenfreude for this?  Sorry, I just don't see it.  Blah, who cares, business as usual.  It'll be up to $10 bill a quarter in no time flat, when they buy the Right People in Congress again....

Long-John-Silver's picture

This is Lehman Brothers II and another economic collapse like 2008.

Sudden Debt's picture

Looks like it.

But this show is costing us a lot of money, so ACT SURPRISED when it happens!

i-dog's picture

ROFL!! Day after day, you crack me up! But it's costing me a lot of coffee in my keyboard........

slaughterer's picture

Can't believe Blankfein rolled out the much-coveted "franchise value" as GS's saving grace.   ... Would love some details on the trades they lost money on in Q2.

snowball777's picture

"Institutional client" that like a rich uncle in an asylum?


augie's picture

while on the subject of insanity, you think i'm being too aggressive buying jan 12' 65 puts on GS? I mean, I'm a little concerned for my mental health as i no longer care if the contract's value evaporates. As long as i know my Lilliputian harpoon has been cast into the leviathans mantle, i can rest easy. Is that strange? 

Anaxagoras's picture

The Squid got beached.

bigwavedave's picture

look at the results from the other 'banks'. they were all supported by loan loss clawbacks. gs has no consumer business at all. no branches. no mortgages. nadda. they are and have always been a fee and volume firm. no volume. and no fees. jeez. listening to you lot and one would think they were a 'bank'....

Larry Darrell's picture

And somehow they still qualified for all of the 3 and 4 letter gov't cheese programs like the rest of the banks.


sunnydays's picture

Couldn't happen to a better company.  Seems all the big boys are having problems all of a sudden.  Guess all those billions of QE2 has stopped manipulating the numbers and some real ones are coming out.   I will be interesting in JPM numbers.  Wonder how much their losses are in the metals market.  :)

Everybodys All American's picture

You can't balme Goldman for thinking risk off this qtr with QE2 suposedly ending this qtr. I still think they are going to be right taking risk off because a market collapse is likely coming.

bigwavedave's picture

they are cashing out their chips. risk off? more like storing what they got. like the rest of ZH readers they already know the end-game. does anyone actually think they are stupid? they wont play the last rounds with all the chips on the table. down to half book value. 

Mr Lennon Hendrix's picture

They are going to need a bigger high frequency trading machine.

Lmo Mutton's picture

I hate it when my thuggery and mischief does not pay off.

Lmo Mutton's picture

I hate it when my thuggery and mischief does not pay off.

Sudden Debt's picture



down 40%, 60% MORE TO GO!


Sophist Economicus's picture

But if they are 'masters of the universe' and the consumate 'insiders' with deep tenticles into 'TPTB", how could this happen?


Oh wait, maybe the market is bigger than any 'TPTB', it does behave 'irrationally' and does wipe out most folks given a long enough timeline....


i-dog's picture

I'm sorry...we already have a winner (see #1469776 above), but thanks for playing.

by bigwavedave
on Tue, 07/19/2011 - 09:36
#1469776 they are cashing out their chips........they wont play the last rounds with all the chips on the table
Sophist Economicus's picture

Nope!   If they were omnipotent, there would be no need to husband cash.   they would be leading 'sheep' to the bloodbath, maximizing revenue further....unless, they don't know either.....


grey7beard's picture

>> But if they are 'masters of the universe' and the consumate 'insiders' with deep tenticles into 'TPTB", how could this happen?

I'm fairly sure there's been a falling out with the current administration.  GSs campaign contributions to Obama have dried up and gone to one of the Republicans.  I don't doubt the juicy tidbits of information necessary for sucess in this market are drying up.  Expect Goldman's profits to make an amazing rebound when a Republican is in the WH.

r101958's picture

Anybody think this might be just what is needed to force QE3?

r101958's picture

We all are, via future least until the dollar collapses.