Inside David Solomon's evolution of Goldman Sachs

Dan DeFrancesco

Tue, Nov 14, 2023, 5:22 PM 6 min read

The big story

Long live Goldman

Tombstone with Goldman Sach's logo with a rose in front.

Did Goldman Sachs need to die to survive?

The prestigious Wall Street bank has drawn plenty of bad headlines over the past few years, often focused on CEO David Solomon. But was Solomon merely evolving the bank to stay ahead of a financial world starting to pass it by?

Famed journalist Bethany McLean, who had a stint in the bank's analyst program, examined the turbulence and the role played by Solomon in this must-read deep dive on the state of Goldman Sachs.

McLean, who coauthored the bestseller "The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron," spoke to Solomon, among other top executives, about the state of affairs at 200 West Street.

And while Solomon has undoubtedly had some missteps — most notably in consumer banking — he's had his fair share of wins, including raising the bank's share price. Still, that hasn't stopped people from viewing Goldman's bygone era with nostalgia. It is "fantasyland," Solomon told McLean.

But scathing media reports and unhappy partners only matter to a certain extent. The group that ultimately decides Solomon's fate — Goldman's board of directors — still supports him, according to McLean's reporting.

McLean's story provides a fascinating look at not just Goldman Sachs' evolution but Wall Street's.

Private-equity firms' power has swelled for years, but that process seems to have accelerated more recently.

Regulations requiring banks to sit on more and more of their capital, thereby limiting the risks they can take, have essentially upended the world of finance.

Banks' origin story — lending — has even been loosened from their grip. Private credit has become the topic du jour on Wall Street.