The Partnership: The Making of Goldman Sachs by Charles D. Ellis

From the Publisher

The inside story of one of the world's most powerful financial Institutions

Now with a new foreword and final chapter, The Partnership chronicles the most important periods in Goldman Sachs's history and the individuals who built one of the world's largest investment banks. Charles D. Ellis, who worked as a strategy consultant to Goldman Sachs for more than thirty years, reveals the secrets behind the firm's continued success through many life-threatening changes. Disgraced and nearly destroyed in 1929, Goldman Sachs limped along as a break-even operation through the Depression and WWII. But with only one special service and one improbable banker, it began the stage-by-stage rise that took the firm to global leadership, even in the face of the world-wide credit crisis.

Publishers Weekly

In this history of investment bank Goldman Sachs, Ellis (Winning the Loser's Game) covers the same ground as Lisa Endlich's Goldman Sachs: The Culture of Success-with notable stylistic differences. From Marcus Goldman's purchase of his first commercial paper in 1869 to the firm's current success, Ellis's account is lively and engaging where Endlich's is accurate but dry. Ellis sheds light on events through dialogue and detailed descriptions of people's thoughts and feelings, embellishments that the author terms "recreations" in his epilogue. The effect of infusing such narrative techniques into the history of Goldman Sachs is entertaining, but it pushes the envelope of nonfiction, especially since the author appears to have interviewed only former partners of the firm. More damagingly, Ellis fails to report much about actual business, and attempts to do so-such as a chapter on Rockefeller Center financing-require lengthy digressions and are incomprehensible due to the complexities of the transactions. Without links to business, boardroom conflicts take on the air of petty squabbles. More a composite memoir of senior Goldman partners than a traditional history, this book will satisfy readers curious about the philosophies and personalities of the firm. (Oct.)

Lawrence Maxted - Library Journal

Ellis, an author and former financial consultant, tells the story of how Goldman Sachs evolved from a sole proprietorship in the 1870s to today's global financial juggernaut. He works in profiles of dozens of the company's leaders, humorous anecdotes, and riveting details of financial crises. He tells how the firm has managed to meld teamwork with competition, a caring culture with high work standards, and making a profit with upholding its reputation. Always focused on recruiting the best people, Goldman Sachs, he explains, has used its intellectual capital to find and exploit widely divergent financial opportunities. From investment banking to arbitrage, from asset management to proprietary trading, it has cultivated success. While Ellis does not ignore some of the firm's unsavory episodes (e.g., insider trading accusations or its dalliance with the late master manipulator Robert Maxwell), he presents the accomplishments of Goldman Sachs as generally praiseworthy. His work is both an insightful company history and an enlightening view of the financial services industry. It is essential for all academic and larger public library business collections.

Kirkus Reviews

Investment-strategy consultant Ellis (Capital, 2004, etc.) gives the financial powerhouse a largely bullish evaluation. His expansive appraisal does, however, report the bad times along with the good at Goldman Sachs. Ellis devotes a few conscientious pages to the firm's early years. Beginning in 1869, founder Marcus Goldman pioneered the resale of commercial paper and catered mainly to fellow Jews. After the arrival of son-in-law Samuel Sachs as a junior partner in 1882, the company expanded its reach and consolidated its prestige, moving into investment banking with the first public stock offerings of Sears Roebuck (1906) and F.W. Woolworth. & Co. (1912). The main focus of Ellis's illuminating text, however, is the preternaturally aggressive partnership's latter-day adventures as Goldman Sachs grew to be an international force in the last half of the 20th century. With only minor lapses into jargon, the author explicates with clarity and verve the fundamentals of risk arbitrage and block trading, mergers and acquisitions, retail sales, initial public offerings, equity underwriting, derivatives, arbitrage investment management, hostile takeovers and credit default swaps. He provides intriguing, specific descriptions of notable events like the collapses of tired old Penn Central and cocky hedge fund Long Term Capital Management. He chronicles the doings of swashbuckling brigand Robert Maxwell. He offers astute character sketches of the principal players, many of whom were sources: tough Gus Levy; "the two Johns" (Whitehead and Weinberg); Secretaries of the Treasury Bob Rubin and Hank Paulson; and Jon Corzine, who tried too soon to go public and ultimately departed for the U.S. Senate andthe New Jersey statehouse. Mapping the firm's tangled loyalties and fiefdoms, Ellis paints a Darwinian portrait of fierce competitors who played people along with the markets. Informed and accessible.

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Table of Contents