OPM Addiction

If March 4, 1933, and February 11, 2009, marked the nadirs of public confidence in Wall Street, then the years 1928 and 1999 marked the zeniths, when Goldman Sachs sold shares to the public for the only two times in its history. In December 1928, the partners of Goldman Sachs sold shares in a subsidiary called Goldman Sachs Trading Corporation--for its day, a complex, highly leveraged instrument with many layers that made transparency all but impossible. By the time of Roosevelt's inauguration in 1933, the shares were nearly worthless. For the next 70 years, burned by that experience and FDR's excoriation in 1933, the firm's partners retreated to their roots as a private partnership, using their own personal capital with only modest leverage to advance their role as a financial intermediary.

OPM Addiction