Why is gs laying off so much
what’s the rational/explanation if anyone has more intel. Are teams overcrowded or is this a strategy to govern by fear?
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GS headcount before the 2021 hiring craze: mid-30,000s
GS headcount now: high 40,000s
Return to normal
Exactly this. Headlines acting like its 2008 again for clicks
Shitman Ballsachs
Over hiring during pandemic. No deal flow. Losses from Marcus/Consumer banking. Goldman puts survival above all else and macro signals are flashing red right now.
Pressure from shareholders. Sucks to work for a publicly traded company sometimes.
GS management wants to (1) reconcile with a significant drop in deal activity compared to 2020-21, and (2) offset billion dollar losses from their failed attempt to break into consumer banking. Shareholders would get salty at quarter end if GS didn't do this.
Do y'all think this just a GS thing? Other banks have done layoffs on much smaller scales already, but wonder what's ahead
I hate to say it, but unless things turn around dramatically in 1Q/2Q, there will be a lot more pain. I suspect most banks are pruning / right sizing to some extent now and are preparing deeper cuts in 1H if business conditions dont improve dramatically. My bank is. Goldman just out front.
BigLaw to follow... and the dominos start to fall - suddenly people can't afford their rent/mortgages, credit card balances spike....etc. Might not be anything near 2008, but this is total mean reversion at its finest. Deflation is on the horizon - see Tesla price cuts the other day.
My guess is it is mainly driven by $$$
because GS knows there are a thousand kids who don't know any better, fapping at the opportunity to come work at GS and can always rehire if needed. I guarantee you there are a ton of prospects salivating right now because they think GS now has more room to hire their ass now that they've cleaned house
Do you know when SA2024 applications open for GS?
March 15
you can literally say this about any bank or large institution -- from google to UBS
What hardo is picking Citi over GS despite Citi paying more? Not many.
Because there's no dealflow and IPOs are down 90%+ and we're in a recession
Obviously deal flow down everywhere but GS is clearly taking this to a higher extreme than most (anyone?) else at this point.
Part of it is just being publicly traded - a private shop can weather some down quarters without anyone really caring, whereas a public company has quarterly earnings reports that they need to worry about. IMO, this is one of the big perks of being at an independent / non-public bank. My guess is other BBs will certainly follow here
GS also tried to grow super aggressively over the past few years (both IB and non IB) and are now feeling the pain as the economy tanks
The shortfalls of shareholder capitalism. In fact, there are no benefits to it.
Edit: not the grade 4 level reading comprehension gang throwing MS thinking the comment is anti-capitalist
Hey intern 👋 just wanted to let you know that there is no such thing as non-shareholder capitalism, and that buzzwords like “ESG” and “CSR” are branding strategy at best, or (at worst) vehicles to appease the political ideology of institutional shareholders/lenders.
But you’re going to quickly rise up the ranks in your MM bank and change the world – go get ‘em this summer buddy!
What an unnecessarily condescending post for no reason.
Not to mention weird snobbery against MM banks. Associate 2, you're like what, 26 or 27 now? And you behave like some Prospect teenage about arbitrary labels like BB and MM. I'm at a BB for what it's worth, nor is it my first summer at one; you need to grow the fuck up and act your age you mega disappointment.
If you think the shareholders are the ones winning from this then become a shareholder and hedge your risk of getting canned
Wtf even is shareholder capitalism?! That's like saying a round circle... no shit a circle is round. U sound like those NPC kids in my humanities core classes that talks non-stop without actually saying much meaningful content.
A bank is not only its IBD part, though this forum focuses a lot on IB. Look at JPM, which is publicly traded, yet a whole different narrative than GS in terms of earnings reports. When shareholders expect return, it's on the entire bank (including asset management, commercial, wealth, securities, etc) and JPM has the largest amount of deposits and sticky commercial lending, which protects/hedges against economic downturns in advisory businesses. ie; take commercial lending / credit cards as an example. Just look at the amount of Chase cards in everybody's wallet. This lending space is actually the top line driver for JPM. In times of rising interest rates, JPM's revenue grows bc it charges higher interests on its top line. This cushions against IBD losses. During 2020-2021 GS had been a powerhouse in IBD, which drove its top line and return to equity. They made adjustments such as increased employment during the good years. But now in the bad years, when IBD is down bc of macro conditions/recession/no deals, this makes it really hard for GS to find ways to save return to equity holders besides cutting costs in the form of layoffs.
MS is similar to GS in that it doesn’t have a heavily BS driven business model like JPM/BofA, and are likely to fall to layoffs as well. Though they did not make that billion dollar loss of a misguided attempt of commercial expansion as GS did, which really did GS dirty last Q
Canadian bank stocks are also rock solid and even the ones with decently sizeable capital markets operations like RBC and TD generally have very few layoffs.
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