How Do Investment Banks Make Money?

This video explains how Goldman Sachs made money back in 2010. Several financial issues are raised here:

1. What is the goal of the firm? What is the goal of an investment banking firm like Goldman Sachs?

2. What does it mean for Goldman Sachs to be a "hedge fund masquerading as a bank?"

3. Are investment banks like Goldman front-running their clients as indicated in this video?

4. Should Goldman trade securities that bet against their clients, or is this trading activity simply risk management?