Obama's Showdown with Goldman Sachs and Future of Finance

Goldman Sachs stated record revenues from proriatary trading for Q2 2009. It is an awesome display of using your scarce resouces (money, intellectual property, corporate culture) to make money in a difficult period. They have set aside $11 Billion to compensate employees (that is just for the first 6 months of the year).

This goes against the socialist philosophy of Obama who has made it clear he wants to regin in compensation and behavior of finanacial institutions. How will Obama respond? I am betting that the adminstration will fight a loosing battle and have egg on its face. Goldman is an example of what free markets can do.

From the WSJ

'The fact that Goldman has rebounded so strongly during the first half of the year could raise questions from lawmakers who have funneled hundreds of billions of dollars into the ailing financial system. Just weeks after repaying rescue funds, Goldman - a firm constantly under fire for its deep government connections - reported that compensation rose 41% to $6.65 billion since the first quarter.'