Trading Is Still a Dirty Word at Goldman Sachs

Goldman Sachs
Goldman Sachs

Goldman Sachs used to tout itself as a trading powerhouse.

But these days, the firm cannot even bring itself to use the word 'trading' in its filings with the Securities and Exchange Commission.

The quarterly results filed Tuesday do not use the word trading at all. Instead, Goldman calls that activity “institutional client execution.”

This is an attempt to make the firm seem to be compliant with the Volcker Rule, a regulatory scheme still under consideration by securities rulemakers that would ban most proprietary trading by banks.

Prior to the financial crisis, Goldman talked about its trading 11 times in one quarter. In 2010, trading was discussed 9 times in one quarter.

Then, beginning earlier this year, Goldman purged the word altogether.

Not all of Goldman’s Wall Street cohorts are as reticent about trading. Bank of America, which also released its earnings Tuesday, mentions trading 11 times.

One irony about Goldman’s silence on trading is that at least when it comes to stock trading, the bank seems to have done better than other Wall Street firms. While most others saw their equity trading and sales revenues decline from last year, Goldman saw a gain. Goldman may not be a prop trading powerhouse anymore but it is apparently a more agile market maker than others.

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