Soon after I meet Blankfein in the diner, Van Praag calls The Wall Street Journal’s attention to an error in the subcommittee’s report. At one point, its paperwork refers to Goldman’s 2007 net revenue as $11.6 billion, when in fact it was $45.98 billion, which makes the approximately $500 million profit the bank made on mortgage-related short positions not a “massive” amount. At least not by Goldman standards. “Five hundred million out of $45 billion that year? Oooooh, lots of money,” one top executive tells me. “I mean, I know $500 million to the man on the street is a lot of money,” he adds hastily.
The most objectionable element of this story is not so much the dollar amount as the fact that Goldman Sachs was betting against its clients at all. But the news spreads. In the Times, the journalist Andrew Ross Sorkin gets the subcommittee chief Bob Roach to admit to making a “typo.” The analyst Richard Bove, who had downgraded Goldman’s stock based on the Levin report, reverses his position. “It is becoming increasingly apparent that a terrible wrong may have been done to Goldman Sachs,” he says. “Goldman Sachs is the scapegoat of our time.”
For those inside the firm, it feels like they might have finally turned the boat back around. “We did it,” Van Praag tells me happily. “We changed the narrative.”
Then, all too soon, the wind picks up again. On Bloomberg television, William Cohan suggests that Goldman “got to” Bove. Taibbi accuses Sorkin of giving Goldman a “rubdown.” The Justice Department continues to comb through the firm’s paperwork in search of further incriminating secrets. And the press surrounding last week’s earnings introduces a humiliating new story line: that the board may leverage a Blankfein resignation as a “trade” to thwart an indictment. The Business Insider runs a smiling picture of Blankfein with the words WHO NEXT? on his forehead.
For now, Blankfein still enjoys the support of his crew.“Lloyd was the steady hand on the rudder,” Rogers calls to say. “People at the firm will tell you that one of our greatest fortunes heading into this was having Lloyd at the helm. And he shares that same level of support when it comes to helping chart the firm’s future.” It’s a future that Blankfein is looking forward to, as well. “We’re not just sitting here like, ‘I hope, I hope, I hope it blows over.’ ” he says. “But I hope it blows over.”