Goldman Sachs' Charm Offensive

Goldman Sachs wants you to know it's not evil.

The investment bank, which reported second-quarter earnings of $2.7 billion last week, spoke to New York Magazine's Joe Hagan to do a little damage control after a rough-up from Rolling Stone's Matt Taibbi earlier this month.

In the New York cover story headlined Tenacious D, Hagan quotes Goldman Sachs Chief of Staff John Rogers saying "We work in a fiercely competitive global industry, but we can’t afford to be oblivious to public opinion."

That the public even has an opinion of Goldman Sachs is a new phenomenon for the extremely private organization. According to Hagan, "The firm’s culture has been compared to, variously, the Army, the KGB, the Mafia, Skull and Bones, a cult."

Being described as a cult is better than being called "a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money."

That's what Taibbi calls the 140-year-old institution in The Great American Bubble Machine," from the July 13 Rolling Stone, the most controversial financial story of the summer.

In the nearly 10,000-word essay, Taibbi. a 2008 National Magazine Award winner, looks at the investment bank and sees the cause of most of America's worst economic crises in the last century. Taibbi also wields his signature hyperbole at John Thain ("the asshole chief of Merrill Lynch who bought an $87,000 area rug for his office as his company was imploding"), CNBC and The Street's Jim Cramer a ("chattering television asshole,") and the average trader ("a small tribe of greedy-as-hell Wall Street swine").

Pretty typical for Taibbi, who practices a full-contact form of journalism. This is the writer who called Thomas L. Friedman's The World Is Flat, "the worst, most boring kind of middlebrow horseshit" in 2005 and in 2007 called the late Russian president Boris Yeltsin "a human pig"—in an obituary.

The Big Money's Mark Gimein called Taibbi's piece "a comprehensive exercise in conspiracy mongering, primed the pump of outrage." Gimein also says, "The guilt-by-association parlor game is always a fun game to play and invariably yields terrific results." We're sure he doesn't mean terrific in the positive sense.

It should also be noted that Taibbi is far from alone in thinking Goldman Sachs is the engine of a vast financial conspiracy: Last year The New York Times Idea Blog did a roundup of several theories out there.

You'd think Goldman Sachs would ignore Taibbi—after all, his piece ran in a magazine with the Jonas Brothers on the cover—but his piece apparently struck a nerve. It probably didn't help that The New York Times ran an A1 story last week about Goldman Sachs' use of a controversial method—high-frequency trading—to achieve those profits. No wonder they're trying to make nice with the press.

Goldman Sachs isn't the only financial mover lifting the veil a bit this week. According to today's Times, the Federal Reserve is on something of a charm offensive of its own. This weekend, Fed chairman Ben Bernanke participated in a town hall forum on the economy in which he spoke about various bailouts and said, "Nothing made me more angry than having to intervene particularly in a few cases where companies took wild bets.”

Quite a change from former chairman, Alan Greenspan, who tended to speak more in Sphinx-like riddles than frank real talk. Suddenly, it's like the Fed is our friend!

Are we witnessing a new openness from our Masters of Universe? Or is this some sort of weird group therapy session for an industry—and its regulators—that wants all of us to feel its pain? If that's the case, don't worry, fellas: We already have.