Matt Levine’s Money Stuff: Goldman Has Some New Divisions

Goldman

The basic historical situation is that there were commercial banks and investment banks. Commercial banks did things like lending money to companies, making mortgage loans, offering checking accounts and issuing credit cards. Investment banks traded stocks and bonds and offered advice to companies on mergers and stock and bond offerings. In the US, the Glass-Steagall Act of 1933 kept these businesses separate, more or less prohibiting commercial banks from trading stocks and bonds, and investment banks from taking deposits.

Like any big company, these companies had different divisions, different business lines. A commercial bank might have a division that ...