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After the financial crash of 2008, Goldman Sachs trader Greg Smith realized he had to make some sacrifices.
His friend Adam was having a birthday party on the Lower East Side. “And not the gentrified part of the Lower East Side, but deep in Alphabet City, a good 10- to 15-minute walk from the nearest subway stop,” Smith writes breathlessly.
Rather than take a cab from his Upper West Side apartment, though, Smith does the heroic, prudent thing — take the subway. “Three transfers. Three long waits. A 15-minute walk to the restaurant.
“I saved 60 bucks.
“I was making between $400,000 to $500,000 a year.”
The heart weeps.
Smith’s new book, “Why I Left Goldman Sachs,” was born from a cri de coeur he wrote in the spring — an argument that the investment bank had abandoned its duty to its clients because of greed.
Instead, what’s in it is a real indictment not so much of Goldman Sachs, but of its very spoiled, very wealthy, very self-aggrandizing former employee, who has somehow convinced himself he’s a hero rallying against the 1 percent.
Smith worked at Goldman Sachs for 12 years and describes the trading floors as akin to a survivalist camp, like something out of “Lord of the Flies.” Junior staffers in London, he writes, derisively called customers “Muppets” and most of the meetings he attended were guided by one question: How could the firm squeeze everything it could out of its clients?
While he tut-tuts this, Smith is preoccupied with letting the reader know where and what he eats: the “rustic Italian” at Supper, exotic fare at the “Asian-fusion hot spot” Buddakan. Lest we forget the 30th-birthday dinner at hipster hangout Freeman’s (tab: $3,000).
Smith, with his affinity for downtown, fancies himself as far cooler than his colleagues and writes of saving the day at a going-away party, playing impromptu DJ in a private room at the Soho House.
“I was the only one there who had my iPod,” he proudly writes. “Nelly’s ‘Ride Wit Me,’ Jay-Z and Linkin Park’s ‘Numb/Encore’ and U2’s ‘Beautiful Day’ were some of the tunes people enjoyed that night.”
The summer of 2006 treated Smith particularly well, and he was offered the use of a colleague’s summer home on Long Island’s North Fork — alas, this, too, was a disappointment. “It was only a two-bedroom,” he writes.
Things start looking up that fall, when he is promoted to VP. A month later, it’s time for Bonus Day, and Smith writes of the “Hunger Games” aspect of it all: one by one, traders called into a glass box, with the entire floor watching. Most employees tried to betray nothing, but some got so infuriated they’d leave work immediately — even if it was 7 a.m.
Smith himself was awarded nearly $500,000 in bonuses that year and has no qualms admitting he was very unhappy with it. “I was being screwed,” he writes. “Our desk had brought in millions of dollars in revenue that year.”
He argued his case and was infuriated when told he simply wasn’t senior enough for a 7 percent share. Yet he proudly notes that, unlike his disgruntled colleagues, he finished out the rest of the workday, ever the professional.
Lest you think he’s an outlier and most investment bankers are total squares — rest assured. Things can get pretty zany, Smith writes. Like the time a partner named Brett Silverman — a real prankster, sort of the George Clooney of Goldman Sachs — wired a conference room with a hidden camera, then hired an actor to pose as a potential key hire. The “job applicant” began to act up, breaching all kinds of etiquette, claiming his goal in life was to own two helicopters and asking about health coverage as he had “a lot of mental-health problems.”
It was, Smith writes, a real “rolling on the floor” moment.
Such frivolity, as we now know, was short-lived. The markets crash in September 2008. Smith decides to tighten his belt, so he cuts down on four-star restaurants (once a week only) and stops taking cabs — the latter ran most bankers up to $10,000 a year.
While Smith’s colleagues are getting the ax on a biweekly basis, he’s offered a promotion — a plum assignment in London. He is deeply bummed and doesn’t make any attempt to hide it.
He’s quickly pulled aside and told he “really, really f–ked up.” The upshot, he writes: He had to grovel for a job he didn’t want — one that guaranteed he was on a senior track at Goldman.
There’s more bad news to come: He gets the job.
His advice for living in London: “Smell the roses as often as possible,” which for Smith involved courtside seats for the French Open in Paris. And “add a lot of salt and pepper to whatever you order. Trust me, it needs it.”
After about six months in, Smith feels so disenchanted that he begins to write about his experience — which would eventually become his infamous op-ed piece. Two weeks later, his book deal is announced.
His advance: $1.5 million.