Times Columnist Andrew Sorkin Discusses Absurdities and Realities of Post-Crash Wall Street: New Issue of ai5000
'Everyone wants to take down the big dog'
STAMFORD, Conn., Sept. 7 /PRNewswire/ -- In the current issue of ai5000, Andrew Ross Sorkin confesses he is perplexed by the degree of criticism directed at Goldman Sachs.
The Gerald Loeb Award winning financial columnist for The New York Times told ai5000 editor-at-large Joe Flood, "The one firm that probably did a better job than anyone else during the downturn is being vilified more than anyone. It's more than a little strange." Sorkin attributed this phenomenon to schadenfreude, noting that "Everyone wants to take down the big dog."
Sorkin noted that Wall Street CEOs believe the public anger is misdirected: "Many folks feel that the largest blame is on Congress, on the people in Washington that created rules that allowed much of this to go on legally, and that no one's focused on them."
Sorkin admitted to Flood he thought institutional customers would be sufficiently upset by conflicts to migrate to boutique firms, but to-date most companies appear reluctant to abandon large bank relationships. "You're talking about companies and individuals who have been doing deals together for a long time and often made a lot of money together," he explained. "They may be reluctant to sacrifice those relationships."
Asked whether post-crash Wall Street is now less inclined to develop hyper-complicated products, Sorkin indicated he saw virtually no movement in this direction. "Scaling back complexity is a great theoretical issue, but it's not attracting any attention on the Street," he observed.
Sorkin rejected the notion that the large banks in recent years had become less skilled at risk management. "It wasn't that the mistakes were new, it's that the scale of the risk they had to manage became bigger and change occurred much faster," he told ai5000, adding that risk will expand and accelerate further as the global markets experience renewed growth.
About ai5000
A quarterly online publication, ai5000 focuses on the 5,000 largest pools of capital in the world, across pension plans, sovereign wealth funds, endowments, foundations, insurance funds and other leading institutional investors. ai5000 is edited by Kip McDaniel. www.ai5000.com
About Asset International
Asset International is a privately-held provider of information and technology to global pension funds, asset managers, financial advisers, banking service providers, and other financial institutions in the private and public sector. Its industry-leading brands include Strategic Insight, SIMFUND, PLANSPONSOR, PLANADVISER, Global Custodian, and The Trade. The company was acquired in January 2009 by Austin Ventures and has offices in New York, Hong Kong, London and Stamford, CT.
SOURCE ai5000
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