Goldman Sachs and the Future of the Internet Essay

Goldman Sachs and the Future of the Internet - Essay ExampleGus Levy, senior partner of the firm from1969 until 1976, is known for articulating the firms investment dodge as being long-term greedy i.e. willing to absorb short term losses in exchange for the promise of long term profits. The raunchy side of the companys dealings has been the fodder of many a polemical writer, however, and not without cause. In 1928 it started the Goldman Sachs Trading Company, which operated much like a Ponzi purpose and collapsed in the crash of 1929. In 1970 it nearly went under when the Penn Central Transportation Company went bankrupt, owing tens of millions of dollars in commercial paper from Goldman Sachs. A crisis erupted which involved numerous lawsuits. In 2007 Two Goldman traders, Michael Swenson and Josh Birnbaum, made a $4 billion profit by short-selling subprime mortgage securities. By 2008 their involvement in the monetary products contributed to the world(a) meltdown that occurred th at year. A source of long-term controversy has been the ease with which Sachs employees transition into government roles. American president George H.W. Bush made former Goldman CEO atomic number 1 Paulson his Secretary of the Treasury. Current Secretary Timothy Geitners chief of staff is former Goldman lobbyist Mark Patterson. The current CEO of the company has visited the White House at least ten times since Barak Obama became president. It is reported that the firm was a major contributor to Obamas 2008 campaign. (A Brief) This dichotomous image of being at once financial geniuses and underhanded opportunists is buttressed by Goldmans activities since the early days of public Internet use. The company handled the IPO of Microsoft,... This essay stresses that Goldman profits regardless of how the company they progress fares over time. However, there are two possible disadvantages in this scenario. Goldman may not sell its holdings in the company before the bubble bursts. It will past lose the profits earned from the stocks price going up. Additionally, investors may be reluctant to invest money in firms promoted by Goldman if their nature suffers over the long term.This paper makes a conclusion that it is worthwhile for Goldman to invest in Internet firms such as Facebook is dependent on which scenario best benefits its general profitability. Given that the last dot-com bubble is still remembered, a cautious strategy would be for the firm to exercise due diligence practices before promoting such companies. Unlike the 1990s, there now exist mature, stable web-based companies that show strong prospects for solid, continued growth into the future. The aforementioned Facebook is one example. This paper has only considered the question from a monetary viewpoint. There are also ethical considerations, however. Deliberately creating bubbles may benefit the firm doing so, but it virtually guarantees an economic contraction and ruined portfolios in the longer t erm. That same outcome can also be seen as undesirable purely from a selfish viewpoint. The world economy is currently in a very fragile state, largely due to the real estate bubble aftermath.