$1.1 billion for speculations: how the director of Goldman Sachs became a billionaire

Bloomberg  declared Director of Goldman Sachs Lloyd Blankfein a billionaire. The history of a boy from a poor family, who was a good student, worked hard and became the head of the powerful investment bank, is the embodiment of the American dream.
24.07.2015
RBC
Origin source
the head of State Goldman Sachs Lloyd Blankfein of July 17, was $ 1.1 billion, Bloomberg analysts estimated. The basis of wealth - the shares Goldman Sachs.

The dream has become a reality through hard work and, as recognized by the banker himself, his fundamental sense of insecurity.

becoming

The future billionaire was born in 1954 in the South Bronx - not very safe area of ​​New York - September 15, 1954. His parents were rather poor Jews. His father worked at the post office night sorter, and his mother - a secretary in the company that sold the alarm. In his own words Blankfein, "the sale of these alarms was almost the only growing business in the region." To earn a living, a schoolboy future banker was selling hot dogs and drinks at Yankee Stadium, and worked as a lifeguard at the springs.

Life in the Bronx Blankfein taught to be careful. The desire to communicate make him witty "pet or become athletes or jokers. I decided to be the latest ", - says Blankfein later his colleague at Goldman Sachs. And poverty has formed a desire to succeed: hoOsho was just learning, later recalled the banker, had just this wish.

Career Lloyd Blankfein at a Glance

27th place went to Blankfein in the list of most influential people in the world in 2014, according to Forbes

$ 23 million was the head of Goldman Sachs in 2013

$ 53.4 million was bonus that Blankfein received in 2006, when took place the head of Goldman Sachs. It was the largest by the time payment of the financier in the history of Wall Street

Shares of $ 500 million received over the years, Blankfein at Goldman Sachs

At $ 4.9 million increase for July 24, the state Blankfein, according to the Bloomberg Billionaire Index

$ 96.5 billion was the capitalization of Goldman Sachs on July 24

$ 8.48 billion achieved net profit of Goldman Sachs in 2014

Sources: Bloomberg, Forbes, The New York Times, Goldman Sachs, CNN, Fortune

In 1971, Blankfein was chosen for the graduation speech utterance - that honor in American schools usually goes to the best students. In the same year he met with representatives of Harvard, who are interested in a promising young man. As a result, Blankfein offered training in the famous Universitéthose. Graduate could not pay for it himself - he was given assistance in the form of grants and allowances. Classmates and friends Blankfein recalled that initially the future billionaire felt in the most prestigious American university rather stiffly.

Blankfein At Harvard he studied history and then law. After graduation he got a job in a small law firm Donovan, Leisure, where he specialized in taxes (as he later recalled - helped big companies do not pay them). In 1981, shortly before it became a full partner, Blankfein experienced, in his own words, "fear of the routine" and decided to radically change their lives. He wanted to become an investment banker and sent resume Goldman Sachs, Morgan Stanley and Dean Witter. But received no response.

The inventor of the BRIC

In 2001, Goldman Sachs employee Jim O'Neill coined the BRIC acronym. It refers to a group of Brazil, Russia, India and China, which in the 21st century will be the engine of world economic growth. The invention O'Neill became so popular that it led to the creation of the BRIC political club to a catoromu then joined South Africa.

The way the trader

Future banker had to settle for the trader - the firm J.Aron & Company, which shortly before had bought Goldman Sachs. There's a future banker started with gold trade. The lawyer was difficult to open a trader. "I found it difficult to understand them, I do not have time for them. I remember that at one of the meetings asked me why I always keep quiet. I think it was just a shock "- recalled Blankfein.

Nevertheless Blankfein quickly made a career. In 1984 he was appointed head of the group of six traders with a focus on international markets, and then - the head of all foreign electricity trading division. At Blankfein had a sixth sense when his subordinates were to risk, and when to do it should not, says Fortune. In 1988 he was elected a partner of Goldman Sachs. Partner Jacob Goldberg Blankfein noted that in the future, the head of Goldman Sachs hit his modesty and good judgment - qualities that are not common on Wall Street.

In 1994, Blankfein was named head J.Aron, in 1997, ledodrazdelenie Goldman Sachs - it included J.Aron Bank and Department for fixed income instruments. It began flourishing investment banks: from the organization of mergers and acquisitions and offerings, they increasingly turn to stock trading.

In 2006, the head of Goldman Sachs, Henry Paulson, Blankfein chose his "successor". Justifying the choice, Paulson stressed that Blankfein, in addition to its outstanding commercial talents, he drew the "feeling of insecurity": "There was not a trace of arrogance, he did not feel himself born for this role. He knew their weaknesses and sought to overcome them. "

Lloyd Blankfein - about their work

"I could have slit his wrists - and people will arrange about this holiday» (The Times, 2009)

"Investment bankers are just doing the work of God» (The Times, 2009)

"I would say the movement" Occupy Wall Street "that the business has helped out of poverty to more people than philanthropy" (speech to the Clinton Foundation, 2013)

"Is it possible to make too much money? Is it possible to be too ambitious? reallyYou can be too successful? »(The Times, 2009)

"I've been doing this [investment] for 30 years. And I think that in vain to say before they say it worked, and from that day suddenly ceased »(The Quartz, 2014)

"This country has made great strides in the creation of wealth, but it can still poorly distributed. Nevertheless, I do not want to interfere with our ability to create wealth »(Fortune, 2013)

At the head of the bank, the reigning world

In 2006, Blankfein appeared headed not the largest, but perhaps the most powerful investment bank in the world, which is devoted simply called "firm". Goldman Sachs was a symbol of Wall Street and the whole of Western capitalism.

When that capitalism began to crumble in the crisis of 2007 the bank became a symbol of the crisis. Octopus experienced mortgage crisis better than their colleagues in time he began to sell mortgage-backed bonds, and his loss is measured in units of billions of dollars (instead of dozens). The worst I had to clients. As it turned out, Goldman Sachs sold mortgage securities they do not warn about possible risks. In 2010, Goldman Sachs agreed to pay $ 550 million to closethe matter out of court. It was just one of many scandals in which the bank was involved. He was accused of shady dealings around the world - to cooperate with the former Libyan leader Muammar Gaddafi to help Greece with a loan, and then find themselves bonded to the country.

Public dissatisfaction with Wall Street was so big, and the reputation and popularity of Goldman Sachs seemed so immutable that it led to the demonization of the bank. "The most powerful investment bank in the world - it is an octopus that covers the entire planet, and non-stop sucking from her all the money" - about the words written in 2010 about the Goldman Sachs Rolling Stone journalist Matt Taibbi.

Shortly before this, in late 2009, the Financial Times named Blankfein "Man of the Year" for the fact that he successfully led his company through the crisis. The newspaper noted that the bank will receive a record profit and will pay up to $ 23 billion of bonuses to its employees. As Blankfein Goldman Sachs managed to save during the crisis, and to remain at the helm? Goldman Sachs was forced to accept government assistance, but he was able to retain independentBridges. "I have always believed in his ability to manage the situation and people. I try to understand people, their performance and the context in which it occurs, "- said of himself Blankfein.

Goldman Sachs employees love their leader. He was placed in the merit of humanity, modesty and lack of arrogance. "It is very interesting, a connoisseur of history and fun with him, he knows how to make a joke, when the situation becomes tense," - talked about Blankfein former employee of Goldman Sachs Jade Sommer in an article for the New York Mag. "And he is humane," - said Sommer, doubted, however, that someone on Wall Street really is human: "In the end, in this world of humanity has no place."

Scandals era Lloyd Blankfein

Greek debt


In early 2002, Goldman Sachs helped Greece hide the true size of its public debt, the country was able to meet EU requirements. Bank traded part of the Greek debt, denominated in yen and dollars, the commitments in the euro. Goldman Sachs used in the exchange of a fixed exchange rate, favorable to Greece. These transactions did not haveityvalis European regulators. But then the maintenance cost of this operation has increased dramatically. By 2005, the volume of off-balance sheet debt of Greece was not € 2.8 billion and € 5,1 billion. Goldman Sachs earned on this transaction at least € 600 million. The head of the banking division responsible for these manipulations, was Lloyd Blankfein.

Libyan investments

In 2014, the Libyan Investment Authority (LIA) filed in London's High Court lawsuit against Goldman Sachs Libyan sovereign fund. The organization accuses the bank of deliberately cheating with investments in 2006-2007, who, during the 2008 financial crisis brought LIA loss of more than $ 1 billion, while Goldman Sachs earned them $ 350 million. The proceedings on the merits must begin in the summer of 2016 . In July 2015 the court ordered Goldman Sachs to pay the costs of the coating process, which make up a minimum of £ 200 thousand.

Layoffs in the Federal Reserve Bank of New York

In September 2014 Carmen Segarra, the former employee of the Federal Reserve Bank of New York (the structure which oversees Wall Street banks), talked about notovsem legal relationship between bankers Goldman Sachs and control staff who turned a blind eye to possible violations of the rules of the bankers. In 2011-2012 Segarra was part of the group supervisory FBI in New York, which monitors the activities of Goldman Sachs. After Segarra told management about his suspicions, she was suspended and then fired.

Among the transactions which raise suspicion of the Federal Reserve Bank of New York, was the transfer of shares of Spanish bank Santander temporary possession Goldman Sachs in 2012. The US bank has received for it about $ 40 million, although in reality, according to one member of the regulator, was "nothing more than a security guard other people's property." Despite the fact that formally the transaction between banks was legal, it could be used to mask its Santander is not the most prosperous position.