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NYSE: GS up 2.5% at time of this comment, which is unintuitive to me. Is this because a significant fine was expected so "baked" into the price? Presumably if
by alva 11y ago
NYSE: GS up 2.5% at time of this comment, which is unintuitive to me.
Is this because a significant fine was expected so "baked" into the price? Presumably if the fine was smaller than expected by the market then it could cause an upward evaluation?
- whatok 11y agoBaked into the price long ago because the fine announced months ago: http://www.bloomberg.com/news/articles/2016-01-14/goldman-says-it-will-settle-u-s-mortgage-probe-for-5-1-billion http://www.bloomberg.com/news/articles/2016-01-14/goldman-sa...
- username223 11y agoYes, it was "baked in": > The bank already provisioned for most of the charges. Goldman set aside $1.95 billion for legal and litigation expenses in the fourth quarter, and $4.01 billion for all of 2015, more than double the totals for the two previous years combined. In other words, Goldman normally spends about 1 billion dollars a year fighting and/or settling lawsuits. This year they spent 4. That's elect-a-president money, a couple bucks for every person in the US, or a few hundred for every likely voter in a swing state. Normal intuitions about money simply don't apply at this scale.