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Good morning.
If you want to know what’s changed about Goldman Sachs since the financial crisis, you can start with the guy at the top—David Solomon, or “D-Sol” as he’s called by those who know him from his DJ side hustle.
Then there’s the more casual dress code. And the selfies from inside the office. But it goes much further than that, as Jen Wieczner shows in her deep dive into Wall Street’s most storied institution. This is no longer the all-powerful “vampire squid” of a decade ago. While the firm still leads in mergers and IPOs, market making in assets like bonds and commodities has dropped to 37% of the firm’s net revenues, down from 72% in 2009. And overall revenue has been declining since 2010. Goldman’s stock over the last five years has been the worst performer of any bank.
Its D-Sol’s job to turn that around. It won’t be easy. But you can read more about how he’s going about it here.
Other news below.
Alan Murray
@alansmurray
[email protected]
TOP NEWS
China Hitch 1
The U.S.-China trade talks aren't done yet—China is reportedly balking at putting a figure on the amount of agricultural products it will buy from the U.S. Each year, and is also still less than keen to curb forced transfers of technology for American firms doing business there. It is apparently also resisting the idea of strong enforcement mechanisms for the arrangement. Wall Street Journal
China Hitch 2
Also unlikely to smooth the path towards a deal: the news that Chinese hackers may have stolen data from the U.S. National Association of Manufacturers, a powerful Washington lobby group. The attribution for the attack this summer came from a cybersecurity firm hired by NAM to investigate the incident; China says the accusations are "creating something from nothing and have ulterior motives." Reuters
Google Banking
Google will from next year offer Google Pay-linked checking accounts, in partnership with Citigroup. Although their offerings aren't quite the same, Google's move will heat up the Android company's rivalry with Apple, which recently launched an iPhone-integrated credit card, in partnership with Goldman Sachs. CNBC
MacBook Keyboards
Apple has unveiled a pricey new 16-inch MacBook Pro that comes with market-leading specifications—and something a little more traditional, in the form of the scissor-mechanism keyboard that it's been criticized for abandoning in recent laptop models. Coins2Day
AROUND THE WATER COOLER
A.I. Fears
A new Accenture report indicates that three-quarters of executives fear their businesses will soon go under if they don't use "artificial intelligence" at scale. Around the same proportion also say they're having trouble widely adopting A.I. In their companies. Coins2Day
German Stagnation
It looked for a while there like Germany was going to slip into technical recession, but no—its economy surprised observers by growing ever so slightly (0.1% quarter-on-quarter) in Q3. However, as ING points out, Q2's negative growth figures have been slightly revised downwards, meaning the country's economy is effectively stagnant. ING
WeWork Loss
WeWork's losses continue to grow—it just reported a $1.25 billion net loss for Q3, which is more than twice as bad as the year before. However, its annual revenue run rate is, at almost $4.2 billion, more than double the figure from a year ago. The third quarter was of course the unanticipated swansong for CEO Adam Neumann, so let's see what Q4 brings. Axios
Xerox and HP
It turns out that Carl Icahn owns not only a 10.6% stake in Xerox, but also a 4.24% stake in HP, which which Xerox is trying to merge (despite HP being three times larger in value than its suitor). The activist investor thinks the merger would bring about heavy cost savings. WSJ
This edition of CEO Daily was edited by David Meyer.
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