Category Archives: Risk Management

Goldman Sachs Reports First Quarterly Loss But Remains Strong

The unbeatable hero of Wall Street, Goldman Sachs, has reported its first ever quarterly loss since it went public 9 years ago. And yes, the market conditions are quite bad.

Goldman Sachs has posted a quarterly loss of $2.1 billion, or $4.97 per share, on net negative revenue $1.58 billion, down from a profit of $7.01 per share in the same quarter last year. Results for the entire year weren’t actually all that bad; the i-bank posted a profit of $2.3 billion, or $4.47 per share, on revenue of $22.2 billion.

Though some may say its down from an $11.6 billion profit last year, but if you see it with a “grounded perspective”, most of Goldman Sach’s competition is in tatters, or buried already.

To us, a surviving and standing Goldman Sachs represents strength. And they have managed to be significantly less exposed to much of the sub-prime crisis and its toxic derivatives.

More than that, Goldman Sachs has the belief to battle it out. If anyone on Wall Street can do it, it has to be Goldman Sachs. And at their current valuation, they are still a ‘buy’!

Welcome to GSIBM: Graham School of Investing & Business Management

Hi Folks, how are you doing? As we near the end of year 2008, I am happy to share this star project of MyOrbit with you. It has been in the works for a while, and now getting ready to go live soon in 6-8 weeks.

GSIBM: Graham School of Investing & Business Management

http://GSIBM.com

It could be considered as an online b-school that’s very practical in its approach, and aims to build business leaders. The program is based on successful business teachings by Ben Graham (and followed by Warren Buffet to produce financial results we all know).

The program has been carefully designed after extensive market research on the business knowledge needs of working professionals at various levels, and it will address a large unmet need.

The program will help working professionals in their career growth with the wide coverage planned: from Finance & Investing, to Sales & Marketing, and Legal Contracts, etc.

You are the among first to get this news, and it will be great if you can share it with others who may be interested, and also bookmark the website: http://GSIBM.com
Best Wishes,
Shankar AVSB for MyOrbit Team

Société Générale hit by $7 billion loss by Rougue Trader- video report

As you may be aware, amidst this past week’s financial market turmoil world wide, we had another very significant development happening. French banking giant Societe Generale revealed a trading fraud which cost the bank $7.2 billion.

Trader Jérôme Kerviel had built combined trading positions over recent months, totalling about €50 billion or $73 billion. SO in this past week, SocGen unwinded about $70 billion dollars of positions (after considering that about $3 billion were direct position losses acknowledged by the bank). One can only imagine the kind of challenge given to SocGen’s best traders to unwind such large positions without causing panic in the markets and protecting their stock price.

This report by Wall Street Journal is the best so far.

We can probably use the simple thumb rule that for every one fraud revealed, at least one more will not be revealed, and one can only imagine what all is hidden in those back office billion dollar trades.

Here are two video reports:

Imagine… SocGen is known internationally for its expertise in equity derivatives. And Risk Magazine had awarded the bank its “Equity Derivatives House of the Year” this month. So a lot of work is needed on the reputation front, to ensure that it does not lose profits from its equity derivatives business. Building reputation is hard; rebuilding is harder.

IMF Economy Update and Thoughts for You

The International Monetary Fund (IMF) will revise its figures for global growth after the recent financial tumult. The largest downward revision is expected for the U.S. economy but the IMF says growth will likely slow in Japan and parts of Europe as well. Contributed by: BusinessCenter.TV -Sep 7, 2007


This video was selected by WeShow

My reading of the situation: it’s not bad at all compared to the difficult times we have seen before over the last 2 decades; so let’s not get jittery for every pothole on the road. And as far as I know, businesses that are using online channels today to reach customers worldwide are really growing at an attractive pace. So if you are deriving over 90% of your revenues from offline methods – BDMs, Sales Staff, Channel Partners, etc- you are at risk. I have absolutely no doubt in that because your cost structures are just too high compared to your competition which may be using online methods to get up to 50% of their revenues. I can say this because we recently helped a business in increasing the online sales component while reducing the sales force effort. It’s possible and it’s happening.

Stay Tuned!
Shankar AVSB, CEO, MyOrbit.tv