Goldman Sachs is a notoriously secretive company, even by Wall Street standards.

So when Greg
Smith, the head of the company's US equity dernatives business in Europe, the Middle East and
Africa publicly signed in early 2012 with a York Times op-ed (abbreviated from opposite the editorial
page) criticizing the firm's corporate culture, he drew instant attention. "If you were an alien from
Mars and sat in on a derivatives sales meeting you would believe that a client's success or progress
was not part of the thought process at all, he wrote. Greg Smith, a Stanford alumnus, gave an Ethics
of Wealth talk at the Stanford Graduate School of Business, He spoke about the "behavioural and
cultural shift that has tied the Wal Street playing field over the past decade. "I don't think Goldman
Sachs is the problem," he said, "I think this is a systemic problem." Smith went to work for Goldman
Sachs straight out of college and he maintains a love of finance He characterizes himself as very
much a capitalist

But, Smith said, the culture of Wall Street changed in the mid-2000s. Trading began to account for a
larger and larger share of Wall Street's profits, and bankers were encouraged to view the client as an
information provider that can make you rich, rather than as a partner" Smith views this as a switch
from Goldman Sachs's traditional tiong-term greedy approach-in which profit is maximized, but over
a long time scale, with a focus on maintaining relationships with alerts-to short term greedy Analysts
were

expected to encourage unsuspecting clients to buy products the company knew were risky

Admitting that Wall Street has always been a gamble, Smith pointed out that the average casino
offers much fairer odds. The average dealer isn't actively misleading a backack player about the
value of the cards he's holding, he pointed out. Nor s he secretty looking at the other player's hands
and then going out and placing his own bets

You would expect someone not to lose very often when you can see everyone's caros, Smith said.
And it's not uncommon for Wall Street traders to post huge profits a phenomenon made possible by
the fact that Wall Street firms know more about their products than their clients do, he said

Lite has changed since the global economic meltdown, Smith said There have been zero criminal
prosecutions of Wall Street executives, and implementation of the Dodd-Frank Wall Street Reform
and Consumer Protection Act has been slow

and ineffective. He pointed out that America's largest banks are bigger now than they were before
the financial crisis

Three basic steps are needed in order to rein in the financial sector, Smith said: regulate derivatives
markets, outlaw propnetary trading, and split banks into smaler units
His recommendations aren't radical-in large part, they derive from the Glass-Steagall Act, the
Depression-era regulatory legislation repealed in 1999 And Smith repeatedly assured the audience
that he wasn't a fan of regulation

think people should be able to get rich," he said. At think they need to do it in a way that's
transparent