Is there really any point hiring anyone out of Goldman Sachs?
Jon Corzine, the former chairman and CEO of Goldman Sachs, who joined MF Global as chief executive last year, appears to have been instrumental in its downfall. Bloomberg pointed out last week that Corzine told analysts on the firm’s last earning’s call that its positions and judgments about risk-mediation were his, “personal responsibility.” Corzine is said to have ramped up trading and risk in an effort to drive profit and emulate Goldman.
Needless to say, it didn’t happen. And Corzine isn’t the only Goldman banker to have come unstuck after leaving the firm. John Thain’s tenure at Merrill Lynch ended with the bank’s emergency sale to Bank of America. Thain also hired Tom Montag from Goldman to run sales and trading. At Goldman, Montag tripled Japanese profits in two years, but BAML’s sales and trading division seems to be doing particularly badly this year. Excluding DVA, revenues plunged 72% quarter on quarter in the three months to the end of September.
Headhunters say rivals can be loath to hire from Goldman: not only are its people hard to move, but they can lose their worth outside the Goldman group-think environment. True, or false? If you have an opinion you are welcome to express it below.