I have to hand it to Goldman Sachs.
On Tuesday, they were gearing to laud their stellar profit numbers of $3.5 billion. Instead, they were forced into damage control concerning the recent litigation brought by the SEC. The regulatory body charged Goldman Sachs with fraud related to those mortgage backed securities we have heard so much about.
In its earnings call, Goldman did exactly what we would tell our clients to do: Embrace their current reality and use it to move forward. Goldman addressed the SEC suit by simply stating that it will either go to trial or they will settle and move on. They did not run and hide or try to be evasive.
Goldman Sachs knows the power of its brand. It knows that it is essential it protects the brand as much as possible. Goldman also knows that its reputation has been tarnished and now must take steps to minimize damage.
So far, it is doing the right things from a brand perspective and the market is rewarding them. Even under the thumb of the SEC, their stock was only off 0.7% for the day.