THE OUTSIDER: Goldman Sachs and super-excessively-tall-poppy-syndrome

Goldman shares are a lot cheaper than they were a few weeks ago. Just as I was thinking of them as a $200 stock, a lightning bolt struck and there might be a buying opportunity. But instead of buying, I'm scratching my head.

The greatest investment banking firm of them all, the firm that every other firm wanted to be, has been on the receiving end of what in other circumstances might be called tall poppy syndrome. Or in this case excessively tall, super-poppy syndrome.

People are angry, they are still hurting from the credit crunch, they want someone to blame - and more than that, they want someone to suffer. Preferably someone rich, talented and successful and who works on Wall Street.

When the public want something enough, and in sufficient numbers, then America being the democracy it is, someone powerful does something to make sure the baying masses get their wish.

Blame the most competitive over-achievers on the planet

And who better to be tossed to the mob than the most successful firm of all, the one that became synonymous with Wall Street success, the smartest, hardest working, most competitive over-achievers on the planet?

I know of no-one in investment banking who does not have an opinion on Goldman. We've all been up against them, and if we won we told the world. If we lost, well, we were up against Goldman after all.

In my investment banking days I had the privilege on a number of occasions of advising governments on beauty parades to determine the selection of investment banks to run major privatisations. Time and again the most telling impression was the one made by the pitch team in the first one and a half seconds after they entered the room. Before they even opened their mouths their demeanour, posture, attitude all spoke volumes. And Goldman Sachs were...well, Goldman Sachs. Supremely confident, consummate professionals who expected to win the business. And did. To me, they were the SAS of investment banking.

So of course everyone hated them - hated and envied and wanted to be them (although preferably without working quite as hard).

And now the green-eyed Lilliputians are trying to tie the giant down. We've all read the accusations. We've all seen Goldman's greatest obfuscating their way through the Senate hearings. We have the threat of criminal proceedings.

Perception is everything

In a sense, the facts of the case don't matter. We're talking politics and the media, rather than the facts of life for grown-up market players. Lloyd Blankfein may be right, but it really won't matter as bucket-loads of mud are thrown at him and his firm. Shock, horror, scandal - 'Goldman Sachs greedy and successful', 'Goldman Sachs made money from shorting', 'Goldman Sachs smarter than the rest of us and richer'.

This is going to run and run, more 'facts' will be unearthed, ex-employees will come forward to testify, people who were on the losing side of trades with Goldman will complain that it isn't fair and how does one firm win all the time, and while the whole circus grinds on, the greatest investment bank of all is going to suffer.

So I won't be buying Goldman shares, at least not yet. They will lose business as nervous corporates hesitate to appoint them while 'the scandal' is being investigated, and of course their competitors will show true solidarity by reminding every potential client just how awful the whole thing is and how sorry they feel for a once great firm...yeah, right.

'Where Egos Dare' by David Charters, is published by Elliott and Thompson, price 6.99.