Is Lloyd Blankfein Finally Toast?

Eddie Braverman's picture
Rank: The Pro | 21,149

It's not easy being Lloyd Blankfein these days. I have to believe he was one of the only people on the planet to feel relief when the Deepwater Horizon exploded. With news of Goldman Sachs seeking a back-channel settlement with the SEC, a recent FCIC subpoena accusing Goldman of stonewalling, and Time Magazine opining about his possible successors, you almost have to feel bad for the guy.

Almost.

Is anyone else surprised that he's lasted this long? From a strictly strategic standpoint, wouldn't he have been of greater utility to the bank as a scapegoat, falling on his sword after the bank went hat-in-hand to the Treasury for a bailout? All the subsequent revelations of wrongdoing could have then been conveniently blamed on Blankfein, in much the same way Obama likes to blame his screw-ups on Bush.

How much longer can Lloyd last? Even with a successful settlement, the SEC is going to force the bank to cop to a charge that makes the bank look like they screwed customers. That black eye isn't going away for a while. And now the FCIC is accusing Goldman of trying to cover up other misdeeds by burying the facts in millions of pages of documents. Right or wrong, it's a public relations nightmare.

Incidentally, the names being put forward for Blankfein's replacement all make sense: Forst, Cohn, even Suzanne Nora Johnson (imagine the pop in the stock price if she were handed the reins). But the one notable absence from the candidate list has to be a complete oversight: Tim Geithner. Let's not forget the role Timmy played in the salvation of the firm, and keeping the AIG stuff off the radar. Tribute must be paid.

I don't envy Lloyd Blankfein one bit. The nature of his career path is such that he's spent the majority of it above the fray, wholly unconcerned with what the peasants might think or say. This has to be a rude awakening. Be that as it may, at what point does keeping him in the CEO position start costing the bank far more than the outward show of indifference is worth?

I'm not really qualified to say, because my personal opinion is that each and every application for TARP assistance should have come with the CEO's resignation letter attached. But we don't live in a world of consequences anymore, do we?

Comments (41)

Jun 9, 2010

About Tim Geithner - GS will never hire an outsider to run the bank, much less one that's spent all his time in bureaucracy and politics.

Jun 9, 2010

I honestly don't think their clients give a shit..their figures are strong and recent reports have pointed to their clients sticking with them. In my opinion, as long as the firm continues to top league tables and churn out massive profits, shareholders won't think about change.

Jun 9, 2010

Blankfein is still very appreciated by insiders and post Blankfein, it's gonna be Cohn! no doubts whatsoever

"What we can, we must; and because we can, we must"

Jun 9, 2010
superconnard:

Blankfein is still very appreciated by insiders and post Blankfein, it's gonna be Cohn! no doubts whatsoever

+1
I do think he served the company well as the CEO through the entire crisis

Jun 9, 2010

Who cares if he is canned, he is a ridiculously wealthy man. The idiot should retire and enjoy his money instead of toiling his life away working, ive never understood men who worked till they keeled over despite ridiculous success and the ability to enjoy life in so many other ways.

Jun 9, 2010
BigBucks:

Who cares if he is canned, he is a ridiculously wealthy man. The idiot should retire and enjoy his money instead of toiling his life away working, ive never understood men who worked till they keeled over despite ridiculous success and the ability to enjoy life in so many other ways.

Because they simply cannot leave at whenever they like. Too much responsibility and too many links to feed. This is the nature of all ridiculously-paid jobs I believe.

Jun 9, 2010

Akio Toyoda was the other person who felt relief when Deepwater Went down as well.

Jun 10, 2010

Blankfein toast? I dont think so.
President Obama is toast, that is what the public is focused on right now.

Jun 10, 2010

The hedge-fund-disguised-as-an-investment-bank model is dying. Within 5 years, GS and it's competitors will have restructured their businesses around capital raising and advisory. At such a time, Blankfein - a trader - will resign and hand the reigns to somebody from the banking side.

But he will not leave amidst these lawsuits because (i) GS would be conceding defeat and, (ii) He does not deserve to go out in disgrace. I give him 2-3 years.

I think the GS lawsuits and Blankfein's tenure are best examined within the broader context of the debate over the modern BB business model. Between new legislation, the trend towards deleveraging, and the widely held notion espoused by PIMCO that banking will return to being a "utility", I can't see how the current manifestation of GS or it's leadership will last much longer.

Jun 10, 2010

Let's look at how much this guy has earned over the past 5 years and how much GS will pay him to walk the plank. Llyod doesn't need to work a day in his life, he could live off the interest of his wealth....easily!

Jun 13, 2010

Looks like GS is getting edged out of the GM deal. Major reputational damage:

http://www.foxbusiness.com/story/markets/industrie...

Jun 13, 2010

april fools?

Jun 13, 2010

dude, that was yesterday.

Jun 13, 2010

I guess april fools jokes work better when its the day after

Jun 13, 2010

you should put on the Rick Roll video. That is more exciting.

Jun 13, 2010

The guy's teeth in the video (when coupled with his voice and song choice) make me feel like he missed his true calling: chewing on metal trash cans for a living.

Jun 13, 2010

haha nice

Jun 13, 2010

With that voice and such amazing teeth and hair I bet that guy gets so much tail after his concerts....

Jun 13, 2010

.... I can't stop watching. I'm strangely fascinated by him.

Jun 13, 2010

the hair is mesmerizing

i can not look away.

Jun 13, 2010

Much worse use (or abuse) of web domain than Meatspin IMHO

Jun 13, 2010

Is that Jaws from the old 007 movies?

Jun 13, 2010

Can't believe some of you guys are throwing monkey shit at the post. Get a sense of humor.

Jun 13, 2010

There is a slight grayish hue to his skin and that blank stare that gives me the impression of a zombie

nevertheless -- very funny

Jun 13, 2010

Ha ha, the guy in the vid kinda looks like Banky

Jun 13, 2010

,well i couldnt believe it when i read that bruce wasserstein died, so...

Jun 13, 2010

dumb. just plain dumb.

Jun 13, 2010

haha this was better because it was on the second, i.e. I believed it at first. Good quote haha

Jun 13, 2010

This was stupid. It's an April fools joke on the wrong day. I guess you think you're funny?

Jun 13, 2010

Lol. When I saw this I thought April fools !!!! Haha

Jun 13, 2010

I can't stop watching this.

Jun 13, 2010

That video is strangely mesmerizing

Jun 13, 2010

The best part about this is that it's in REPLAY mode.

I just spent 30 minutes of my saturday night watching this.

SAC:

That video is strangely mesmerizing

Jun 13, 2010

Just a little HTML sleight-of-hand.

Glad most of you enjoyed the gag. I'm guessing the ones who didn't were either hoping/fearing it was true.

Jun 13, 2010

And for those truly committed:

http://www.bustedtees.com/trololo

Jun 13, 2010

Not completely sure this is legit, but it looks real enough:

Jun 13, 2010
Comment
Jun 13, 2010