A fun tweet today from @zerobeta described Goldman Sachs as follows: "Goldman is the Marsha Brady of Financial World. It's always about Goldman Goldman Goldman!"
The observation definitely rings true this week. As the bank prepares to release its third-quarter earnings this Thursday, everyone's getting their bank sheets in a twist over upcoming bonus season. Analysts are estimating that Goldman's pool will accumulate a cool $23 billion, ripe for generous disbursal -- and even riper for populist lament.
But Andrew Ross Sorkin writes that Goldman's executives are paid mostly in stock and "may impose a clawback provision that would require employees to give up some of their compensation if trades go the wrong way." Ostensibly, clawbacks are supposed to guard against wild risk-taking -- and ensure that employees are considering the long term performance of the bank before they take risky gambles.
Even in light of those superb earnings and bonuses, Meredith Whitney has downgraded Goldman shares from Buy to Neutral. Everyone's favorite canary in the coal mine -- or perma-bear, depending on how you look at it -- writes that Goldman's 34% run in price since second quarter has prompted a "why be greedy" rationale. "At $190, shares have exceeded our $186 12-month price target, and we believe upside could be limited over the medium term," she adds.
Is the finance world's Cassandra on target again? Or merely trying to make waves?
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