Goldman Sachs Partners Borrow to Cover Margin Calls

[Joanne98]

Tough times on Wall Street are reaching all the way to the highest levels of the most storied former investment bank—Goldman Sachs—as partners there are being forced to borrow money to cover margin calls, according to sources within the firm.

Several Goldman Sachs partners have leveraged their Goldman Sachs stock to buy alternative investments such as hedge funds & private equity, and they have done so through their Goldman Sachs brokerage accounts.

But Goldman stock has declined in value by more than 50 percent since last spring, meaning that Goldman Sachs is in the awkward position of making margin calls on its own partners, who can't meet those calls because their alternative investments are underwater and they don't have enough cash on hand.

Now those partners are being forced to borrow money—millions of dollars—to meet Goldman Sachs' own margin calls.

http://www.cnbc.com/id/29260008

[AndyA]

1. Oh what a tangled web we weave...

I have no pity for these Wall Streeters. They rode high and mighty for a long time, now they need to see what it's like on the other side of the fence.

[CanonRay]

2. I thought nobody was able to borrow money?

Oh yeah, I forgot who I was talking about.

[Celebration]

3. You can always borrow money IF

you have collateral, which is what buying on margin is.