Goldman Sachs CEO David Solomon warned on September 16 that the bank's fixed income business was shaping up to be softer in the third quarter compared to previous quarters, sending the shares down 3.9% that day and drawing a shocked reaction from CNBC host Jim Cramer. Cramer, whose charitable trust owns Goldman, said on his September 18 morning appearance that the meetings were terrible and that he was shocked by the soft fixed income, adding that if the numbers are going down, the stock is going down. The warning echoed an earlier caution from Bank of America CEO Brian Moynihan, who had flagged soft investment banking income due to a slowdown in fixed income trading. For Goldman, investment banking and trading income matters more than for Bank of America because of its ill-fated foray into and subsequent withdrawal from consumer banking, leaving mergers and acquisitions and investment banking performance to drive investor response. In the second quarter, Goldman's return on tangible common equity stood at 16.2%, up from 12.4% in 2025, 9.3% in 2024 and 7.1% in 2023, while investment banking fees grew 55% to $3.4 billion and Global Banking and Markets, which includes fixed income, grew 53%. Goldman trades at a forward P/E of 12.8 versus Bank of America's 10.8, with short interest at 2.4% of float against BAC's 0%, and 92 hedge funds disclosed a Goldman stake in the second quarter versus 111 for Bank of America.
Goldman Sachs Group IncCEO Solomon warned Goldman's fixed income business would be softer in Q3, hitting its key trading/investment banking revenue.
Bank of America CorpArticle notes BofA CEO Moynihan earlier flagged soft investment banking income due to a fixed income trading slowdown.
