Bailout

Quote of the day, Goldman edition

By Felix Salmon

Quote of the day comes from Goldman Sachs CFO David Viniar, responding to confusion over whether the squid’s 36% compensation ratio for 2009 is here to stay:

?I take this year?s revenue ratio not necessarily as a onetime thing and not necessarily not as a onetime thing,? Mr. Viniar said on the conference call. ?We will know more as the quarter and the year unfolds.?

Glad that’s cleared up, then.

Viniar also said that, yes, Goldman does have proprietary trading operations, which account for “10ish” percent of its revenues. Does anybody believe that only 10% of Goldman’s revenues come from trading for its own account? I don’t — but as I say, the lines are fuzzy. As far as I know, Goldman already has no dedicated prop desk, and it’s child’s play to simply reclassify any given trade as being in some way client-related. So while I like the idea that the Obama administration is going to try to crack down on prop trading with its new Volcker rule, I’m not at all convinced it’s doable.

Full post as published by Macroprudential on January 21, 2010 (boomark / email).