The core skills of investment banking – marrying up the capital needs of financially stretched issuers and the investment objectives of those with cash still to put to work even after wrenching portfolio losses – have never been more valuable.
So it should not come as a shock or provoke resentment that Goldman Sachs, still the world’s pre-eminent investment bank, pulled in record quarterly equity underwriting revenues between April and June. With banks still reluctant to lend, corporations and financial institutions need to repair their over-leveraged balance sheets and raise funds. Those capital markets intermediaries that help this to happen are doing a better job for the global economy than the still-reeling banks.
So we should be pleased by Goldman’s profits. They are evidence that the capital markets are doing their job at a vital moment for the economy.
But Goldman’s senior management and employees and...
