How efficient a money machine is Goldman Sachs?

Consider that the Wall Street houses—Merrill Lynch, Morgan Stanley, Lehman Brothers, Bear Stearns, and Goldman—are expected to earn a combined $28 billion this year, according to a survey by Bloomberg News. Goldman has more than 40 percent of that pot.

The firm reported today that it earned $11.6 billion for its year that ended on November 30, up 22 percent from 2006.

It is an extraordinary achievement at a time when the collapse of the subprime mortgage market has roiled all of Wall Street. Goldman took a big bet that securities backed by mortgages would fall, and won handsomely.

"If you look at their profitability through a period of intense credit and mortgage-market turmoil, you'd have to give them an A-plus," Guy Moszkowski, an analyst with Merrill Lynch, told the New York Times last month.

And Goldman will be certain to shower its riches upon its top executives, traders, and bankers. The firm also said today that it paid $20.2 billion in compensation and bonuses this year—or roughly $661,500 per employee.

"The talent of our people and our focus on teamwork were at the core of our ability to support our clients while delivering strong returns for our shareholders," said Lloyd Blankfein, Goldman's chief executive.

In the fourth quarter, Goldman earned $3.22 billion, or $7.01 per share, up 2 percent, from $3.15 billion, or $6.59 per share, in the quarter a year earlier. Net revenue, or revenue minus interest expenses, rose 14 percent, to $10.74 billion. The results surpassed forecasts.

But return on equity, a closely watched measure of profitability on Wall Street, fell to 34.6 percent, from 41.5 percent.

Investment banking was a standout performer in the quarter. Revenue jumped 47 percent, to $1.97 billion, even as underwriting activity was flat.

Asset-management and securities services also did very well, posting a 29 percent increase in revenue.

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