That 6-7% is 6-7% of the offering price, not the day's closing price. So the statement "In this way the bank could artificially jack up the new company’s price,

That 6-7% is 6-7% of the offering price, not the day's closing price. So the statement "In this way the bank could artificially jack up the new company’s price," is the opposite of the truth: in this way, the bank lowers its fee in exchange for a first-day price increase. That's marketing: Goldman wants to be able to sell the next IPO, so they try to pay off their customers. And that means they can promise e.g. Groupon that they'll have enough buyers. As usually, Taibbi is vaguely correct (investment banking is a middleman between two groups that are individually worse-informed than the bank is). But he either doesn't understand how this actually works, or deliberately obscures the facts in order to make his point slightly stronger.