What is the feeling people have when they think about banks? An interesting study about the reputation of Goldman Sachs (GS), the biggest investment firm in the world aroused our interest on the actual perception of people about the state of the economy and its future. Saifedean Ammous states in his book ‘The Bitcoin Standard’:

“Banking has evolved into a business that generates returns without risks to bankers and simultaneously creates risks without returns for everyone else”

The idea of GS during the financial crisis was not good. Public perception of the investment bank as a potential employer plunged as its share price sank. In a survey of 17,000 Americans, Brand Asset Consulting found that people have instilled doubt about Goldman’s abilities 2008 and 2009. “Goldman Sachs still has that Gordon Gekko look to it among the general public,” said Anne Rivers, who oversaw the survey, referring to the villain of the 1987 film Wall Street.

10 years later from the financial crisis with the firm getting a fresh start with incoming CEO David Solomon, who starts his new role on October 1, things are looking much better. By matter of fact, within the past couple of years GS came forth a new idea about which sees an improvement in its public image, according to a research firm YouGov’s Plan & Track.

In ‘The Bitcoin Standard’, Saifedean Ammous does not seem to follow this positive view on banks, neither does he seem to be open to reduce his criticism on the industries practices. Reading the book helps you to understand that the improving reputation of Goldman Sachs is a byproduct of Fed-driven bubbles in the stock market and overall economy. Bubble-induced prosperity provides a way of having the public on your side, as results showed in the above mentioned survey. It’s hard to remain indignant about economic issues when the stock market is soaring, jobs are being created, and consumers are spending. Unfortunately, as we’ve experienced during the dot-com and housing bubbles, it’s during these so-called “good times” that we have to be the most vigilant and sceptical. GS is not the actual cause of this growing bubble which is mostly caused by Fed fractional reserve and dovish economy aimed in increasing the money supply, but the bank is certainly riding the wave of temporary prosperity. Saifdean Ammous clearly is not blinded by bullish markets and considers to have a rational look on the banking sector. Perhaps we should think twice if our judgement is correct or if we are blinded by the light. And maybe it is good to remember the reasons behind people’s judgment of the industry back in 2008.