Goldman Sachs Chairman on AI and the Future of Finance | The a16z Show

1. 0:00 – 1:02

   Intro

   1. LBLloyd Blankfein0:00

      Anybody who's investing, you know, you're doing two things. You're trying to make money for yourselves and your clients, and so you're trying to get out there and take risk, and you're also trying to be a risk manager, and you have to do both.

   2. DHDavid Haber0:10

      I think it was your quote there. It's like, "If you're so good at predicting the future, tell me what's gonna happen next."

   3. LBLloyd Blankfein0:14

      Once the present turns into the past, everybody's a genius. Most of what we do with respect to risk is not so much predicting. It's a lot of contingency planning.

   4. DHDavid Haber0:22

      We are on the precipice of some of the largest IPOs ever. What are risks that you think are underappreciated?

   5. LBLloyd Blankfein0:27

      Before this technological age, not just AI, but in general, could you have had a mistake that could cost billions of dollars? Um, not really. But now you can leave a, a piece of software could go out and do 70,000 transactions. The leverage in these things is themselves a pretty problem.

   6. DHDavid Haber0:45

      Yeah.

   7. LBLloyd Blankfein0:45

      Not because it's smarter than us and it's gonna turn us into pets-

   8. DHDavid Haber0:48

      Mm

   9. LBLloyd Blankfein0:48

      ... but because we don't have the ability to test whether it's right or not.

   10. DHDavid Haber1:00

       Y- your tweet, by

2. 1:02 – 2:18

   Twitter Snark And Risk

   1. DHDavid Haber1:02

      the way, about the White House Correspondents' Dinner was amazing. Uh, I think for, for the good of, like, the timeline, we need you back on, on Twitter more often.

   2. LBLloyd Blankfein1:08

      I know. You know what it's a funny thing is I, y- you know, you would think that, um, you see something and you're activated to tweet about it. It, it, for me, I said, "Oh, gee, I haven't tweeted for a long time. Let me find something to tweet about." That's more... A- and also being in the risk management business, I always know that everybody keeps doing that, and eventually you get canceled because you do, you know, you do something, you step over some invisible line that you, you know, that nobody knew about. And so I realize that from a risk/reward point of view, it's all ego and no, no real value other than that. But that was saying, you know, when you retire, you'll, you grasp at straws.

   3. DHDavid Haber1:43

      Yeah. Why not? I mean, it was like 10 million views later or something. It was, it was amazing.

   4. LBLloyd Blankfein1:46

      Yeah. Well, I went to, I remember when I was, um, doing a what's-his-name from, uh, Tw- You know, I got this, uh, I said to, you know, when I retired, no unrestrained, uh, no, uh, I, I, I am, I am freed from the str- restraints that I had 'cause I started, you know, I did this at Goldman.

   5. DHDavid Haber2:01

      Yeah.

   6. LBLloyd Blankfein2:01

      And I realized that I was, um, you know, playing a dangerous game.

   7. DHDavid Haber2:04

      Sure.

   8. LBLloyd Blankfein2:04

      Because I was being snarky with the president, and I had all those back and forths-

   9. DHDavid Haber2:09

      Totally

   10. LBLloyd Blankfein2:09

       ... with, um, Sanders and Elizabeth Warren.

   11. DHDavid Haber2:12

       The, the, the other thing I was curious to ask you, you know, you're obviously, like, famous for being calm under pressure and a, a risk, a risk manager, but

3. 2:18 – 6:44

   Calm In A Crisis

   1. DHDavid Haber2:18

      it was reported that you, you know, w- like, during the active shooter, like, you lean over to the person next to you and you're like, "You're gonna, you're gonna finish that, that, that salad." Is that, was that a real-

   2. LBLloyd Blankfein2:26

      No, that was, yeah, that was real, but I w- uh, but it wasn't, you know, it wasn't like I was d- I was hungry. I was so ever... You know, I always used, in, in moments of crisis like that, I always tried to be disarming.

   3. DHDavid Haber2:37

      Sure.

   4. LBLloyd Blankfein2:37

      And, uh, you know, everybody was... And, and by the way, it was very sensible to duck down under the desk.

   5. DHDavid Haber2:43

      Yeah.

   6. LBLloyd Blankfein2:43

      I mean, it was a line, it w- you know, realized we were pretty close up, and I was just s- it wasn't, it wasn't that thoughtful on my part. It was just that I was like, it was like, it was like being in a m- movie, and I was, like, enjoying watching it.

   7. DHDavid Haber2:56

      Totally.

   8. LBLloyd Blankfein2:56

      And you had all these, um, guys who were in tuxedos. Suddenly they had little, you know, they had, uh, they had pistols in their hand, and there were guys in full tactical gear, and they all ran in, and they all s- you know, they all were on the stage w- with their guns facing outward, of course, 'cause that's where the threat would've come from. Then I, you know, suddenly, you know, a guy tugs at my, uh, you know, leg, and he said, "You know, you really should get down." And I said, "You're really right." I said, "You know, this is like, like when I get into an airplane, this is one, this is another time that I'm glad I'm short." Um, but I was, uh, you're watching it, and then, and then I saw what everybody was doing. And, you know what? I, I didn't see a lot of panic. I didn't see any panic really.

   9. DHDavid Haber3:31

      Yeah.

   10. LBLloyd Blankfein3:31

       And the people under desk, which was a sensible thing to do.

   11. DHDavid Haber3:33

       Yeah.

   12. LBLloyd Blankfein3:33

       But again, to break the moment, I looked down and I said, "By the way, are you gonna finish your, uh, are you gonna finish your, are you gonna finish your salad?" And it's amazing. It was just, you know, it was kind of a, you know, it was kind of funny at the time.

   13. DHDavid Haber3:43

       Like ice in the veins, you know? I don't know.

   14. LBLloyd Blankfein3:46

       Well-

   15. DHDavid Haber3:46

       Were, were you always even-keeled, like, as a, as a kid, or?

   16. LBLloyd Blankfein3:49

       Yes. I was, uh, you know, in... Somebody said it at Goldman, you know, "You're very good in a crisis, and, uh, and, and, and that's why you go out of your way to create them, so you, so you can give, you're given an opportunity to be good in a crisis." And I would say that my normal resting, um, you know, my resting state is to not be resting. So, um, I tend to be a little bit wound all the time.

   17. DHDavid Haber4:12

       Mm.

   18. LBLloyd Blankfein4:12

       But I don't get especially wound-

   19. DHDavid Haber4:13

       Mm

   20. LBLloyd Blankfein4:13

       ... if there's a crisis. In fact, things slow down for me.

   21. DHDavid Haber4:15

       Mm.

   22. LBLloyd Blankfein4:16

       I'm used to seeing things, uh, like that. They're in slow motion, and I become very sensitive to what the people around me are thinking-

   23. DHDavid Haber4:24

       Mm

   24. LBLloyd Blankfein4:24

       ... and trying to, you know, get them, uh, aboard. But most of the time, like at Goldman and, and in most w- most of life, in a crisis time, the, the really important thing is just to get people to do their jobs-

   25. DHDavid Haber4:36

       Yes

   26. LBLloyd Blankfein4:36

       ... and to stop being, you know, stop, you know, n- don't be frozen, and don't be, uh, don't submit to the chaos.

   27. DHDavid Haber4:42

       Do you think that was, like, innate, or was there something from your childhood that sort of, like, helped kind of breed that temperament?

   28. LBLloyd Blankfein4:48

       I don't know. I wouldn't have predicted that about myself, but I've now gone through, you know-

   29. DHDavid Haber4:52

       Yeah

   30. LBLloyd Blankfein4:53

       ... we, we, you know, going, we had the crisis of the century roughly every four or five years. Um, and it's always that way. By, by the way, it doesn't mean I like crises, and I wouldn't go out of my way to volunteer to be in one. It's just that when it happens, I, I, I generally have confidence that I'm not gonna get discom- uh, that I'm not trying to tempt the fates. If I'm gonna get discombobulated, everyone is gonna get discombobulated before me.
4. 6:44 – 23:36

   From Public Housing To Wall Street

   1. DHDavid Haber6:44

      but maybe to go backwards in time.

   2. LBLloyd Blankfein6:45

      Yeah, sure.

   3. DHDavid Haber6:45

      Obviously you, you, um, you know, you had a very modest upbringing. Um, you know, I was curious, like, you know, uh, what role did like living near New York City or Manhattan maybe more specifically play in sort of like creating ambition or, or... For me, you know, I didn't grow up in the projects, but I grew up very modestly as well and-

   4. LBLloyd Blankfein7:04

      Where'd you grow up?

   5. DHDavid Haber7:05

      In South San Diego, in Chula Vista, like 10 minutes from Mexico. Mom was a public school teacher. You know, Dad worked in retail in, in Mexico, uh, very far from, you know, Cambridge. And Harvard really changed my life, right?

   6. LBLloyd Blankfein7:15

      So your dad had to get through the border to get to Mexico every day. Did they give him a tough time at the border?

   7. DHDavid Haber7:19

      He had a motorcycle, so it was a little bit-

   8. LBLloyd Blankfein7:21

      Yeah, look at that. Yeah

   9. DHDavid Haber7:21

      ... a little, a little bit easier.

   10. LBLloyd Blankfein7:21

       And then see, they flip shoes on the other foot.

   11. DHDavid Haber7:23

       E- exactly. Um, but, uh, you know, Harvard definitely changed my perspective on what's possible, and I always say I learned more from my peers than I did from my, my classes. I'm, I'm just curious if you had a similar experience to-

   12. LBLloyd Blankfein7:34

       I would say that I, I, I grew up in the, uh, you know, with Manhattan looming in the distance.

   13. DHDavid Haber7:40

       Yeah.

   14. LBLloyd Blankfein7:40

       I think I probably, when I was... Before I went to college, I'd probably went into Manhattan three times or something like that.

   15. DHDavid Haber7:47

       Mm.

   16. LBLloyd Blankfein7:47

       And I think twice was to the Radio City Music Hall Christmas show.

   17. DHDavid Haber7:51

       Yep.

   18. LBLloyd Blankfein7:51

       And I know one of them was my, was an interview to go to Harvard.

   19. DHDavid Haber7:55

       Mm.

   20. LBLloyd Blankfein7:56

       And that was a big deal. We might as well have been 5,000 miles away from it.

   21. DHDavid Haber8:00

       Mm.

   22. LBLloyd Blankfein8:00

       Because, you know, I grew up in public housing. It was, this won't mean anything to you. It was a two-fare zone. You had to take a b- you had to take a bus to the subway to get to the city. Probably took, you know, took a long time to get there. I grew up, I grew up in public housing.

   23. DHDavid Haber8:13

       Mm.

   24. LBLloyd Blankfein8:13

       NYCHA.

   25. DHDavid Haber8:14

       Mm-hmm.

   26. LBLloyd Blankfein8:15

       Um, and you know, where I think, you know, and there is a gradation of incomes that you can have. There's different levels of public housing and I think, you know, my... If you made more than $90 a week, you couldn't live in that, in that particular building. So y- y- you know, it was, um, you know, since then I've met people who've walked across deserts, people who grew up in war zones, so I don't wanna compare, compare stories 'cause a lot of people had tougher stories than that. But it was, um, I didn't know a lot, and so I, I didn't have the burden of high expectations.

   27. DHDavid Haber8:47

       Mm.

   28. LBLloyd Blankfein8:47

       And, and that's a funny way of putting it, but I did label the first chapter kind of advantages-

   29. DHDavid Haber8:52

       Mm

   30. LBLloyd Blankfein8:52

       ... as opposed to burdens because I realize now, now that I'm on the other side of the, you know, the other side of the ledger, I understand just what a burden high expectations can be on people. I did not suffer from that.
5. 23:36 – 37:25

   Goldman Culture Tech And Partnership

   1. DHDavid Haber23:36

      our audience.

   2. LBLloyd Blankfein23:36

      Sure.

   3. DHDavid Haber23:36

      I'm curious, um, you know, how did, how did you think about technology during your time at Goldman? And, you know, what role did it play kind of in evolving the firm? I'm sure it changed the markets business even, you know-

   4. LBLloyd Blankfein23:48

      Oh my God, we were always, the technology was always changing everything. And, you know, and the, and the... And by the way, in a lot of what we- not everything, but a lot of things in finance, it's winner take all.

   5. DHDavid Haber23:58

      Totally.

   6. LBLloyd Blankfein23:58

      You know, if you put your, um... I mean, I'm sure the world has moved on, but even, you know, even a few years ago, if you, you know, if you had a, uh, you know, if you had a, if you had a risk, you know, an, an execution system that communicated digitally back to the floor of the exchange, you wanted your computers a half a block closer to the exchange than everybody else's because the milliseconds-

   7. DHDavid Haber24:19

      Mattered. Yeah

   8. LBLloyd Blankfein24:20

      ... not only mattered, it was winner take all. You got everything.

   9. DHDavid Haber24:23

      Yep.

   10. LBLloyd Blankfein24:23

       You got that, you got the offer or you hit the bid, and other people were left looking at it, you know, looking at your dust-

   11. DHDavid Haber24:28

       Totally

   12. LBLloyd Blankfein24:28

       ... for that. So you were always, always competing for the best technology in a winner take all situation. By the way, a lot of life, whether people realize it or not, is winner take all.

   13. DHDavid Haber24:36

       Sure.

   14. LBLloyd Blankfein24:37

       Um, I can see, you know, I know w- you know, the opportunity set and the challenges and the anxiety people have about the current, uh, about the current thing.

   15. DHDavid Haber24:46

       Yeah.

   16. LBLloyd Blankfein24:46

       And I think obviously I still, you know, invest and I still transact in the market. I think about that too. But I would say that no one is a better adopter, uh, or pays more-

   17. DHDavid Haber24:56

       Sure

   18. LBLloyd Blankfein24:57

       ... uh, except for ob- obviously the hyperscalers themselves who wanna be the providers of the technology. But in terms of use of the technologies, um, you know, the financial area is, you know, wants to be on top of it. And so interesting, by the way, there's a lot of... You end up in a lot of cul-de-sacs. You'll end up, you know, going down bad paths because you, you just don't know.

   19. DHDavid Haber25:16

       Sure.

   20. LBLloyd Blankfein25:16

       And you, uh, and, and, and you have to do this. And I know that everybody's talking about is looking for cost savings. But, you know, we always had, we always had to do things twice. We had to do the... Uh, we had to use the system we were confident in-

   21. DHDavid Haber25:31

       Mm

   22. LBLloyd Blankfein25:31

       ... and then simultaneously run the new system-

   23. DHDavid Haber25:35

       Mm

   24. LBLloyd Blankfein25:35

       ... we had high hopes for-

   25. DHDavid Haber25:37

       Sure

   26. LBLloyd Blankfein25:37

       ... but we didn't have a high level of confidence. In our business, and as a regulated company that we were, we weren't allowed to have mistakes.

   27. DHDavid Haber25:45

       Mm-hmm.

   28. LBLloyd Blankfein25:46

       By the way, that's another schism between the Valley-

   29. DHDavid Haber25:49

       Sure

   30. LBLloyd Blankfein25:50

       ... and finance. So you could be, um... You know, I looked at, you know, Robinhood, great company.
6. 37:25 – 41:14

   Firm Over Fund Culture

   1. LBLloyd Blankfein37:25

      bring them in. If we so- sourced opportunities that they wanted, we'd work that out. Um, and s- it's not always easy to work that out, but we were able to engage with our clients as peers-

   2. DHDavid Haber37:37

      Mm-hmm

   3. LBLloyd Blankfein37:37

      ... and not merely as supplicants looking for business.

   4. DHDavid Haber37:39

      Mm.

   5. LBLloyd Blankfein37:39

      And so little more swagger, a little more understanding of what our clients are going through because we're principals also.

   6. DHDavid Haber37:45

      Totally.

   7. LBLloyd Blankfein37:46

      We didn't wanna lose that culture, which by the way, is not evident in our peers.

   8. DHDavid Haber37:51

      Yep.

   9. LBLloyd Blankfein37:51

      And there are other reasons for that. If you're gonna be in an investing business, you know, it's a more volatile P&L. And, you know, going back to the beginning of the conversation where people get, managers get confused between being wrong and being stupid.

   10. DHDavid Haber38:05

       Mm-hmm.

   11. LBLloyd Blankfein38:06

       At times when the people on the investing side made a lot of money-

   12. DHDavid Haber38:11

       Mm-hmm

   13. LBLloyd Blankfein38:11

       ... they wanted to fire the firm and go off and do their own thing.

   14. DHDavid Haber38:14

       Mm.

   15. LBLloyd Blankfein38:15

       And at times when they lost a lot of money, the firm wanted to disconnect from them-

   16. DHDavid Haber38:18

       Mm

   17. LBLloyd Blankfein38:19

       ... and because they couldn't bear the losses-

   18. DHDavid Haber38:20

       Mm

   19. LBLloyd Blankfein38:20

       ... that there had been. Goldman Sachs, in its view and its partnership culture, was able to look through those short-term things and say, "Look, over a cycle, great business."

   20. DHDavid Haber38:31

       Yep.

   21. LBLloyd Blankfein38:32

       You know, and the people who ran those businesses stuck it out.

   22. DHDavid Haber38:36

       Totally.

   23. LBLloyd Blankfein38:36

       You know, maybe they could have done better here or there, but there were other reasons why they stuck it out, and they did.

   24. DHDavid Haber38:41

       I, you know, I think a lot about, uh, kind of firm, a lot of the alignment, you know, that you d- described, um, you know, even in the shape of our firm, obviously we're much, much smaller than Goldman Sachs, but... And I wrote this piece that, uh, where I sort of draw, drew a distinction between firm over fund. You know, the objective function of a fund is how do I generate the most carry with the fewest people in the shortest amount of time possible? In a firm, you know, you have to deliver exceptional returns, which is sort of a prerequisite for doing that well. But I think the second variable is like how do you build sources of compounding competitive advantage? Like what are your moats? Again, orienting around not just your indi- individual fund but around the culture and success of the firm.

   25. LBLloyd Blankfein39:14

       Well, it's also, again, you have to put your money where your mouth is sometimes, how you compensate people.

   26. DHDavid Haber39:18

       Totally.

   27. LBLloyd Blankfein39:19

       And by the way, you can get a b- people will try to pick off your best people because you're, if you're paying the people who are going through the doldrums better because other people are earning more money, it could be, it could be coming at the expense of the people who made more money and someone will come in and take those. So you have to, you know, there's a, you know, there's a practicality to this thing.

   28. DHDavid Haber39:37

       Totally.

   29. LBLloyd Blankfein39:37

       So you can't pay everybody the same, uh, you know, through good times and bad times. You have to do it, but you have to, you have to, you have to mute the s- the effects of the cycle.

   30. DHDavid Haber39:47

       Yep.
7. 41:14 – 47:05

   Mentorship and Entrepreneurial Initiative

   1. DHDavid Haber41:14

      to the, one of the quotes that I heard from Ashok was that, um, you know, he, he said you often believed in him more than he believed in himself, and that, that's been the main driver for why he stayed at the firm so long despite other more lucrative opportunities along the way. Was sort of instilling a confidence in your, in your pe- I'm just curious how you thought about sort of inspiring-

   2. LBLloyd Blankfein41:32

      Well, I don't think, you know, lucrative, but you know, there's a lot... People make a lot of money.

   3. DHDavid Haber41:37

      Ashok, he's done fine.

   4. LBLloyd Blankfein41:38

      At the same time, the... No. Yeah, he's done-

   5. DHDavid Haber41:39

      Yeah, he's done okay

   6. LBLloyd Blankfein41:40

      ... and the increment, but he has a big, you know, he's a substantial guy-

   7. DHDavid Haber41:43

      Yep

   8. LBLloyd Blankfein41:43

      ... as opposed to being a bigger fish in a smaller pond. Um, so you know, found that, you know, it's attractive. Look, you have to... I, I think, you know, I think, I think I'm a good judge, you know, of people. I, I ca- I like people. I care about them. I empathize with them. I want that. I wanna be, eh, you know, not so much liked as appreciated. I wasn't always liked. Uh-

   9. DHDavid Haber42:07

      Sure

   10. LBLloyd Blankfein42:07

       ... if you read my rev- re- reviews. But I was always appreciated. I, I wanted to make people better. I wanted... I didn't wanna juggle for them or tell jokes or be, you know-I, I wanted them to think that I made them better than they otherwise would've been, that they got a lot out of it. And that's, you know... And, and I really, I, you know, I really to the core care about them. I think I can read people. But I identified Ashok. By the way, it's not my brilliance for sourcing him, it's his brilliance for being brilliant.

   11. DHDavid Haber42:34

       Sure.

   12. LBLloyd Blankfein42:34

       I don't wanna get confused, but I knew it, I knew it early.

   13. DHDavid Haber42:38

       Yeah.

   14. LBLloyd Blankfein42:38

       I think one of the things that I had in my time in insurance is that I wasn't a victim of the organization chart.

   15. DHDavid Haber42:46

       Mm.

   16. LBLloyd Blankfein42:47

       You know, Gold- you know, these firms could be very... Goldman Sachs is not very bureaucratic and not very... I remember when I was very, very early in my career, I remember I came from left field to J. Aron. J. Aron was acquired by Goldman. A- Go- Aron wasn't doing very well.

   17. DHDavid Haber43:02

       Mm.

   18. LBLloyd Blankfein43:02

       But I had this idea. I was in the precious metals business.

   19. DHDavid Haber43:05

       Mm.

   20. LBLloyd Blankfein43:05

       That made me have to deal with people from the Mid East who were investors in, in, in gold and that. I'm chatting with people on the other side. "And what are you doing? What do you need?" And, you know, it turns out that even though they were speculating in precious metals, what they really, really wanted to do-

   21. DHDavid Haber43:20

       Mm

   22. LBLloyd Blankfein43:20

       ... was they wanted to be able to invest money and get a, an interest rate, like predictable return.

   23. DHDavid Haber43:28

       Mm.

   24. LBLloyd Blankfein43:29

       But under their rules of engagement, sh- you know, their law, um, they weren't, uh, uh, they were b- they weren't allowed in those days, the r- the real strictly religious crowd wasn't allowed to take interest. It was usurious. And what they were looking for ways of making inv- making kinds of investments that would read like an investment.

   25. DHDavid Haber43:51

       Mm.

   26. LBLloyd Blankfein43:52

       They were allowed to make investment returns, they just weren't allowed to collect interest.

   27. DHDavid Haber43:55

       Sure.

   28. LBLloyd Blankfein43:55

       But had the stability and predictability of an interest.

   29. DHDavid Haber43:58

       Mm.

   30. LBLloyd Blankfein43:58

       And what they were doing, and, you know, we can go into details or not-
8. 47:05 – 56:11

   Crisis Proof Risk Management

   1. DHDavid Haber47:05

      uh, more present day. But, um, um, you know, Goldman fared obviously incredibly well during the financial crisis, you know, and o- o- obviously earned public backlash, m- I would argue unfairly, you know, as a result. Um-

   2. LBLloyd Blankfein47:18

      Yeah. That's what I agree with that on.

   3. DHDavid Haber47:19

      Yeah, yeah. I figured. Um, what, what do you think helped the firm navigate that period so well? You know, was it risk management, technology, um, the fact that you didn't have a big consumer business?

   4. LBLloyd Blankfein47:30

      Risk management. The b- the lack of a big consumer business hurt us in the back end on the reputational side-

   5. DHDavid Haber47:36

      Sure

   6. LBLloyd Blankfein47:36

      ... 'cause people didn't know us.

   7. DHDavid Haber47:37

      Right.

   8. LBLloyd Blankfein47:37

      We were a big influential government sack. So I have, you know, people who get left Goldman became very big officials, prime ministers, and by the way, not just in the US, overseas as well.

   9. DHDavid Haber47:46

      Totally.

   10. LBLloyd Blankfein47:47

       And so, but in the beginning, you know, risk management culture, and maybe that stemmed from the fact that we were a partnership lately.

   11. DHDavid Haber47:55

       Mm.

   12. LBLloyd Blankfein47:55

       We had unlimited liability. There's nothing that focuses your attention-

   13. DHDavid Haber47:58

       Mm

   14. LBLloyd Blankfein47:59

       ... better than being a p- you know, you're a partnership.

   15. DHDavid Haber48:01

       Skin in the game.

   16. LBLloyd Blankfein48:01

       You're not t- You're investing client money, and you're not leveraging your own money. We, you know, you know, at, at, you know, the partners not only had their capital accounts at risk, they had their homes at risk.

   17. DHDavid Haber48:12

       Mm.

   18. LBLloyd Blankfein48:12

       I remember when I became a partner, um, I said, "Should I be putting, you know, my, you know, should I be putting my house in my wife's name?" And it was very funny 'cause then the minister of the interior, this is back when we were a partnership, said, "You know, LloydNo partner at Goldman Sachs has ever lost money because the firm, you know, because of losses at the firm. But plenty of Goldman Sachs partners have lost money because they put assets in their, in their spouse's name. So that was it.

   19. DHDavid Haber48:40

       Funny line.

   20. LBLloyd Blankfein48:40

       So, and it was a funny line, but by the way, like a lot of funny lines-

   21. DHDavid Haber48:43

       Yeah. True.

   22. LBLloyd Blankfein48:44

       True. And so-

   23. DHDavid Haber48:45

       Yeah

   24. LBLloyd Blankfein48:45

       ... but it did focus your attention and it made us very, very-

   25. DHDavid Haber48:49

       Totally

   26. LBLloyd Blankfein48:49

       ... to- totally on it and risk managers are very attentive to risk. And now one of the pro- one of the consequences of that concern, we marked things to market rigorously-

   27. DHDavid Haber48:58

       Yep

   28. LBLloyd Blankfein48:58

       ... religiously, and other people didn't.

   29. DHDavid Haber49:00

       Yep.

   30. LBLloyd Blankfein49:00

       They didn't have ta- you know.
9. 56:11 – 1:13:15

   AI Backlash and Career Wisdom

   1. DHDavid Haber56:11

      for worse, I would argue, but, uh, I think a lot of the technology companies are gonna inherit a lot of the public flak that a firm-

   2. LBLloyd Blankfein56:17

      Oh, gu- guaranteed.

   3. DHDavid Haber56:18

      Right. Right. So I mean-

   4. LBLloyd Blankfein56:20

      Once upon a time, we were you.

   5. DHDavid Haber56:21

      Right.

   6. LBLloyd Blankfein56:21

      We were the investment bank and all these other commercial banks, and then it evolves, and now, you know, you're an institution now, and there's people who market themselves as a more flexible, current-

   7. DHDavid Haber56:35

      Sure

   8. LBLloyd Blankfein56:35

      ... now version-

   9. DHDavid Haber56:37

      Many others

   10. LBLloyd Blankfein56:37

       ... m- you know, version of what you used to be.

   11. DHDavid Haber56:39

       But e- but even beyond, like, our firm, 'cause, you know... But I, I think, like, a lot of the AI labs are, you know, they're gonna create a lot of change in the, i- in the world, in our economy.

   12. LBLloyd Blankfein56:48

       Sure.

   13. DHDavid Haber56:49

       And I think there'll be a lot of negative, uh, backlash, you know, to them. I guess, what advice do you have for the leaders of an OpenAI or Anthropic or maybe Elon, you know, for how to navigate, you know, through that, for even from a communications perspective?

   14. LBLloyd Blankfein57:03

       Well, I think one of the things, and I learned this the hard way, one of the things that we didn't do-

   15. DHDavid Haber57:08

       Mm

   16. LBLloyd Blankfein57:08

       ... is we were a wholesale firm.

   17. DHDavid Haber57:10

       Mm.

   18. LBLloyd Blankfein57:11

       We didn't have, you know, go get a mortgage from Goldman Sachs. Go open a checking account at Goldman Sachs.

   19. DHDavid Haber57:15

       Right.

   20. LBLloyd Blankfein57:15

       Go to your local Goldman Sachs branch. Doesn't exist.

   21. DHDavid Haber57:17

       Right.

   22. LBLloyd Blankfein57:18

       So people didn't know us.

   23. DHDavid Haber57:19

       Yep.

   24. LBLloyd Blankfein57:20

       Institutions knew us. Companies knew us. Governments knew us. We were the biggest in that world. We didn't advertise ourselves. We had a whole PR department-

   25. DHDavid Haber57:27

       Yep

   26. LBLloyd Blankfein57:28

       ... to keep our name out of the paper. It turns out we were too important, too influential, too big to be anonymous-

   27. DHDavid Haber57:35

       Yep

   28. LBLloyd Blankfein57:35

       ... especially in a crisis, and especially to do, to come out of a crisis as well as we did.

   29. DHDavid Haber57:39

       Yep.

   30. LBLloyd Blankfein57:40

       And so nature abhors a vacuum, and the, you know, and the official sector abhorred us. What were we gonna do? Kick the, kick the shit out of Lehman Brothers-

Episode duration: 1:13:44