What major financial crises has Goldman Sachs been through?

by matteo.zboncak , in category: Banking and Credit , 9 months ago

What major financial crises has Goldman Sachs been through?

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by keshawn , 9 months ago

@matteo.zboncak 

Goldman Sachs, one of the largest investment banks in the world, has experienced several major financial crises throughout its history. Some notable crises involving Goldman Sachs include:

  1. Great Depression (1929-1939): Like many financial institutions, Goldman Sachs faced significant challenges during the Great Depression. The firm suffered substantial losses and struggled to maintain its operations during this economic downturn.
  2. Dot-com Bubble (Late 1990s): During the late 1990s, Goldman Sachs was heavily involved in underwriting and advising numerous technology companies. When the dot-com bubble burst in 2000, many of these companies faced financial difficulties, leading to significant losses for Goldman Sachs.
  3. Subprime mortgage crisis (2007-2008): Goldman Sachs played a significant role in the subprime mortgage market that eventually led to the global financial crisis of 2008. The firm packaged and sold mortgage-backed securities, including risky subprime mortgages. When the housing market collapsed, Goldman Sachs faced considerable losses and was accused of misleading investors by selling securities linked to subprime mortgages.
  4. European debt crisis (2010-present): The European debt crisis, triggered largely by the financial woes of Greece, had a significant impact on Goldman Sachs. The firm faced losses as it held significant exposures to European countries struggling with mounting debt burdens.
  5. Global financial crisis (2008-2009): Goldman Sachs, like many other financial institutions, faced substantial challenges during the global financial crisis. The firm received a $10 billion capital injection from the U.S. government's Troubled Asset Relief Program (TARP) and converted into a bank holding company to access additional liquidity. Goldman Sachs also faced criticism for its role in causing or exacerbating the crisis.


It is important to note that while Goldman Sachs faced challenges during these crises, the firm also managed to survive and recover, often relying on government support and taking measures to adapt to the changing financial landscape.