Goldman Sachs

Stephen A. Schwarzman and Peter G. Peterson, who started Blackstone Group LP two decades ago with $400,000, stand to collect a combined $2.33 billion from the largest initial public offering by a leveraged buyout firm. The 60-year-old Schwarzman will receive $449.2 million for selling some of his holdings, leaving him with a 24 percent stake, Blackstone said yesterday in a filing with the Securities and Exchange Commission. Peterson, 80, who is retiring next year, will get $1.88 billion and retain 4 percent of the company.

NEW YORK -- Goldman Sachs Group Inc. rose 33 percent on its first day of trading as a public company yesterday, giving the 130-year-old investment bank the third-largest market value among U.S. securities firms.The shares rose $17.375 to $70.375, vaulting the firm ahead of Merrill Lynch & Co. Inc. in terms of market worth. No. 1 is Morgan Stanley Dean Witter & Co., and No. 2 is Charles Schwab Corp. The shares rose as high as $77.25 on 22.3 million shares traded, the third-most of any stock.

ON DEC. 31, 1998, when the Dow Jones industrial average average closed at 9,181.43, Charles Carnaggio of Lutherville became our contest winner with his year-end forecast of DJ 9,183. He made the projection last January when the Dow was around 7,875. About 2,500 entries were received.The winner and his wife will be dinner guests of Mr. and Mrs. Ticker at Michael's Cafe, the Carnaggios' favorite restaurant.Carnaggio, a retired Bell Atlantic equipment installer, said: "I felt that the high-tech, regional Bells and pharmaceutical stocks would do very well.

Orion Power Holdings Inc., which acquires and operates power plants, said yesterday that it will receive a $200 million investment from two Japanese companies as the Baltimore-based company eyes going public.Under terms of the agreement, the Japanese trading company Mitsubishi Corp. will invest $120 million and Tokyo Electric Power Corp., Japan's largest utility, will invest $80 million in Orion, a joint venture of the New York investment firm, Goldman Sachs Group Inc., and an affiliate of Constellation Energy Group, the parent of Baltimore Gas and Electric Co.The Japanese companies will jointly appoint an additional member to Orion's five-member board of directors and receive an undisclosed stake in the company, said Jack Fusco, Orion's chief operating officer.

Orion Power Holdings Inc., a joint venture of Constellation Energy Group and Goldman, Sachs & Co., said yesterday that it completed its $550 million purchase of three New York City power stations.Orion announced its intent to purchase the power stations from Consolidated Edison Co. of New York in March.The stations, in Queens and Brooklyn, are fired by natural gas and fuel oil. They have a total summer electricity generating capacity of 1,555 megawatts -- enough to meet the needs of 2 million customers and representing about 25 percent of the generating capacity in New York City.

ON DEC. 31, 1998, when the Dow Jones industrial average average closed at 9,181.43, Charles Carnaggio of Lutherville became our contest winner with his year-end forecast of DJ 9,183. He made the projection last January when the Dow was around 7,875. About 2,500 entries were received.The winner and his wife will be dinner guests of Mr. and Mrs. Ticker at Michael's Cafe, the Carnaggios' favorite restaurant.Carnaggio, a retired Bell Atlantic equipment installer, said: "I felt that the high-tech, regional Bells and pharmaceutical stocks would do very well.

Orion Power Holdings Inc., a joint venture between Constellation Energy Group and Goldman Sachs Group Inc., said yesterday that it agreed to buy seven power plants from a Pittsburgh company for $1.71 billion in cash.Baltimore-based Orion will acquire the plants, in Pennsylvania and Ohio, from Duquesne Light Co., a subsidiary of DQE Inc.The seven plants have a total capacity of 2,614 megawatts -- enough to light 2.6 million homes -- and would double the megawatt capacity of Orion's portfolio, which includes power plants throughout New York, the company said.

NEW YORK -- U.S. stocks rose yesterday, led by financial companies such as Merrill Lynch & Co. as record earnings from Goldman Sachs Group LP showed that the bull market is boosting profits on Wall Street.The Dow Jones industrial average rose 88.19 to 8,904.44, recovering most of Monday's loss and closing 2 points from a record.The Standard & Poor's 500 index rose 10.10 to a record 1,105.65. The Nasdaq composite index rallied 19.93 to a record 1,812.44.Other broad market indexes set records as well.

Industry sources are speculating that Ciena Corp., a Linthicum-based telecommunications equipment firm, is being bought.Rumors that Ciena would be taken over were fueled by a sharp rise in the company's stock yesterday and the settlement of its long-standing litigation with rival Pirelli SpA.People close to the matter say that Tellabs Inc., another telecommunications firm, will buy Ciena for $7.3 billion in stock and leave Ciena shareholders in control of...

IF YOU have enough U.S. stocks -- and foreign investing tempts you -- how do you invest internationally?One way is through mutual funds. As Goldman Sachs' booklet, Opportunities Around the World, suggests, "Many people don't have the time or knowledge of foreign markets to select individual stocks, but mutual funds provide professional management and diversification."The booklet adds, "A major measure of foreign stock markets is their historical performance. In fact, the U.S. market ranked among the 'Top 3' performers only twice in the last 10 years."

It's the end of the world as we know it, and the Dow Jones average feels fine. So do Goldman Sachs, JPMorgan Chase and much of the rest of Wall Street. American International Group has a few sniffles, but nothing that the $198 million in bonuses employees stand to collect won't assuage. The fortunes of Wall Street have never been a precise indicator of national welfare. But tell me the last time the gorge between plutocrats and ordinary Americans was this wide. Unemployment is 9.8 percent.

Legg Mason star money manager Bill Miller believes the "worst has passed" in the stock market and the economy, and predicted that technology and financial stocks should continue to perform well in a recovery. In a quarterly letter to investors of his flagship Value Trust mutual fund released Wednesday, Miller said market performance in the second quarter was a break from the financial collapse that began when Lehman Brothers failed last fall. The Standard & Poor's 500 Index rose nearly 16 percent in the three months ending June 30, while his fund gained 29 percent, reversing two years of dismal performance.

Goldman Sachs posts record quarterly profit WASHINGTON - Goldman Sachs Tuesday reported the largest quarterly profit in its history as a public company, $3.44 billion between April and June, as the decimation of its Wall Street rivals allowed the investment bank to romp across the financial landscape, buying low and selling high. The New York firm is only months removed from a federal rescue that included emergency approval to become a bank holding company, $10 billion in direct federal aid and help borrowing billions more to finance its operations.

Here's something to keep an eye on: If Congress and the Justice Department don't thoroughly investigate how Goldman Sachs has managed to turn chicken stuff into chicken salad in the midst of the credit meltdown that savaged some of its competitors, well, we'll know the fix is in. If I were a betting man (and I am), I'd give you long odds on that happening and be very confident of winning the wager. Last month in The New York Times, William D. Cohan laid out the suspicious circumstances surrounding the rapid recovery of what some wags call "Government Sachs" from the ravages of the subprime collapse to an "unexpected" first-quarter profit of $1.8 billion.

The latest craze sweeping America is to express outrage over those employee bonuses paid out by ailing insurance giant AIG. Rep. Barney Frank wants to fire some AIG executives; Sen. Charles E. Grassley said the recipients of tens of millions of dollars in performance bonuses should "resign or go commit suicide." He later "explained" his remark as being mere rhetoric. Sens. Christopher J. Dodd and Charles E. Schumer, both big-time beneficiaries of Wall Street campaign contribution largesse in recent years, are demonstrating their eagerness to distance themselves from their contributors by suggesting if the AIG execs don't return their bonus money, they should have it returned to the American people - who now own 80 percent or so of the company - through special confiscatory taxes.

Baltimore-based Constellation Energy Group said yesterday that it has agreed to sell most of its London-based commodities business as it continues to divest itself or wind down much of the operation that was the source of its credit troubles. Terms of the deal with an affiliate of Goldman Sachs were not disclosed. The international unit - including its coal and freight operations and European trading units - has 120 employees, nearly all based in London. Constellation is shoring up its finances and reducing its liquidity risk, while it focuses more on its traditional energy business after facing down a near bankruptcy late last year.

Good riddance. When the clock strikes midnight this New Year's Eve, many will be happy to give a goodbye kiss to one of the worst years in stock market history. The trouble is that the start of 2009 doesn't look as though it will deliver much relief. As Wall Street investment strategists issue outlooks for next year, they are describing the early 2009 economy with such terms as "horrible," "awful" and "dismal," words you rarely see from individuals who tend to be optimists. They see consumers in trouble with debt and job losses, businesses struggling to borrow money and hold onto customers, and cities, counties and states trying to do more with less as pressures on consumers and businesses reduce local tax revenue.

San Diego Padres owner John Moores has hired banking giant Goldman Sachs to search for a potential buyer as he goes through a divorce from his wife, Becky. "I have been told that, because these are difficult economic times, I should be prepared for a wide range of interest and offers," Moores said in an e-mail yesterday to the Associated Press. "Needless to say, San Diego is a very attractive place to own a baseball team," he said. The hiring of Goldman Sachs was first reported by mlb.com.

Warren Buffett to the rescue: His Berkshire Hathaway Inc. agreed yesterday to invest $5 billion in Goldman Sachs Group by way of a purchase of preferred stock. Berkshire also will get warrants to buy up to $5 billion of Goldman common shares. The deal, announced after markets closed, amounts to a huge vote of confidence by Buffett in Goldman, at a time when investors remain spooked about the future of the investment banking business. "Goldman Sachs is an exceptional institution," Buffett said in a statement.

NEW YORK - The investment bank Goldman Sachs, the firm that has looked the best throughout the credit crisis, reported a profit yesterday that was 70 percent less than a year ago, as executives tried to rebut notions that their firm's business model might be broken. Goldman's profit of $845 million, or $1.81 a share, in the third quarter compared with a profit a year earlier of $2.81 billion, or $6.13 a share. The results, while in the black, showed that even the strongest on Wall Street are having a tough time making money.