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SYNOPSIS

     Henry Goldman is arguably the founder of investment banking as we know it today. In 1906 he began diverting his father’s company from a bank specializing in commercial paper into a Wall Street firm that helped enterprises expand operations by raising the capital they needed through the sale of their shares to the public. He was ethical, conscientious,  a first-rate investor and an aggressive risk-taker. Above all he was a visionary and the creative genius who revolutionized Goldman Sachs.
     By year end 2007, prior to the Great Recession, Goldman Sachs had become one of the most admired financial firms on Earth with former partners serving in the most coveted financial posts worldwide from Chairman of the Federal Reserve Bank, Secretary of the Treasury, and President of the World Bank to lesser positions such as chief operating officer of the SEC’s enforcement division or head of the Troubled Asset Relief Program (TARP).  However, after the Great Recession of 2008 began, many attributed the world’s economic ills to Goldman Sachs and  other Wall Street firms.
     The question is what Henry Goldman would have thought about the Goldman Sachs of today and what he would have said or done. Author Daniel Alef traces the Goldman Sachs story and the role Henry Goldman played in its evolution. This is the story of the beginning of IPOs, how Henry led Goldman Sachs, Lehman Brothers and Kleinort, Sons & Co. in London into taking public companies previously ignored by financial firms, including Sears Roebuck, Woolsworth, Studebaker, Cluett Peabody--117 companies in total. It was a tectonic shift in the world of finance. This is the fascinating tale of a very private man who supported the arts and sciences—a close friend of Albert Einstein, Yehudi Menuhin and many others—a man with his own take on World War I, and the ultimate, intractable breach between the Goldman and Sachs families.  [10,067-word Titans of Fortune article, including a timeline, bibliography and video links]

EXCERPT

     Henry Goldman is arguably the founder of investment banking as we know it today. In 1906 he began diverting his father’s company from a bank specializing in commercial paper into a Wall Street firm that helped corporate enterprises expand operations by raising the capital they needed through the sale of their shares to the public. He was extremely ethical, conscientious,  a first-rate investor and an aggressive risk-taker. Above all he was a visionary. Working with his brother-in-law, Samuel Sachs, Henry oversaw the growth of Goldman Sachs into a nationally recognized and well-respected banking organization.
     By year end 2007, prior to the Great Recession, Goldman Sachs had become one of the most admired and highly regarded financial firms on Earth, with assets owned, invested or under its control in excess of $1 trillion and net annual earnings exceeding $11.5 billion. Former Goldman Sachs executives filled many of the most coveted and important financial posts worldwide from Chairman of the U.S. Federal Reserve Bank, Secretary of the Treasury, and President of the World Bank to lesser positions such as chief operating officer of the SEC’s enforcement division or head of the Troubled Asset Relief Program (TARP). Presidents, prime ministers, premieres, kings, dictators, moguls, corporate titans, pension fund managers and executives of the world’s largest corporations, sought the firm’s advice and counsel. Goldman Sachs, ranked number one in mergers and acquisitions, and regarded as the gold-standard of investment banks, could do no wrong. 
     Then the Great Recession descended in 2008 like a black plague spreading its virga around the world, an onslaught that ripped to shreds the fabric of international economic stability, leaving nations and their populace shaky, confused and uncertain about the future. Businesses failed; homeowners lost homes to foreclosure; millions of employees became unemployed; and nations scrambled and struggled to deal with the devastation. Riots and protests, in Greece, Spain, France, even England, spread as those countries sought to rein in their economies with sound austerity measures.
     Finger pointing began in earnest. Not at governments engaged in excessive spending while accumulating massive and unprecedented national debts. Not at people doing the same thing and living well beyond their means while accruing ever-increasing personal debt. Not at homebuyers who borrowed the entire cost of their new, speculative homes, without a dollar of down payment, only to lose them when the real estate market headed south. People and governments were living on borrowed time and money, but they were not held  accountable. There were no pleas of mea culpa from any of them.
     However, according to the media and to virtually every politician large or small on the prowl for excuses or votes, the culprits who brought about this economic tsunami were solely the men, and the few women, who populated the plush executive suites of the major commercial banks, investment banks and their Wall Street allies. . .