When I first started in this game in the early 90s, the Japanese houses such as Nomura and Daiwa ruled the world. Now Nomura are a shadow of their former self and I don't even know if Daiwa is still around. Salomon's was also top of the tree for a long while and at that time Goldman envied them. Salomon is of course no more. No doubt Goldman's are at the top at present and have been for the last 5-10 years but the point is this - NONE of these investment banks is able to stay top for ever, it's always changing so Goldman's reign will end, it's just a matter of time.
GS monthly chart is sort of tracking the Dry Ships Index over the last few years. At their size they are very diversified and the comparison to the shipping index shows that to a certain extent their stock price mirrors the world economy... that says a lot really, the main obvious thing is that they aren't "beating the indexes" [and who does at their overall size... ] with regard to the monthly chart the up-volume pushes of the last couple of years have produced only lower highs so yeah, it's still in a downtrend... if some news comes out that they have pulled an LTCM the chart isn't showing much force at this time to hold up the stock price... I'd laugh if they got caught up in some derivative thingy they couldn't/didn't unwind/hedge... Barings Bank was an old-old $ thing and they got taken down by one trader.. it's tough managing things that can get out of hand like they can... I wonder if the USA economy would be better off or worse if GS went belly up? By the time they got their bailout our grandchildren would be in twice as much debt probably...
if they do go bust they won't go alone. it'll shake up the trading world for a bit, but then we'll all settle into some cush spreads.
Without a doubt. GS going down would create significant collateral damage. I doubt a currency position or positions could do serious harm to GS, isn't that what risk management is for? they tout that crap all the time no? either way.. i think the thing to worry about is Eric Holder and his army of prosecutors. Levin and Coburn stirred up a hornets nest with their subcommittee report. no matter how much juice GS has on the hill/in DC. if someone gets fire burning at Justice, becomes rather unstoppable. regards
One thing is for certain, there is absolutely no reason to hold or buy the GS stock right now especially with it making new lows everyday. Looking at the weekly chart, it looks like its in one of those waterfall selloffs and it does look like the 2009 lows isnt too far away. I dont hear Buffet associating himself with it anymore.
Looks like GS is set to open lower today. Everyday it will lose a few points here or there. By year end I can see it easily trading under 100.
Goldman Sachs is just a bad company which delivers a poor product compared to its competitors at a much too high fee. Here's a nice article which illustrates what I mean: http://www.amsterdamtrader.com/2011/05/goldman-messing-up-clearing.html edit: Obviously this is just about the clearing. I'll elaborate by saying that their image is currently just totally subpar, next to possible issues with their actual service. It doesn't matter whether the shit they get is actually truthful.