I've heard about analysts having conflicts of interest, but this one takes the cake. Goldman Sachs (NYSE: GS) CEO Lloyd Blankfein actually called VTB Group CEO Andrei Kostin to apologize for an analyst's sell rating on the company's stock. Why would he do that? Bloomberg sums it up:

The situation highlights the tension U.S. investment banks face wooing clients in developing markets while complying with regulations at home that compel them to publish independent research. Goldman, which lags behind competitors in Russia, is adding 25 bankers in Moscow this year to tap what it considers the country's ``huge potential.''

Goldman worked on the bank's May IPO. While it's tempting to decry this as a sign of a lack of analyst independence, I think it's actually the opposite: This has all been done out in the open, and the analyst's report on the company was allowed to be published. That's a far cry from what might have happened a few years ago.

So while Blankfein's pandering is pathetic, we can take some encouragement from the fact that report is still available.

• Read about the exit of Goldman Sachs' star Mark McGoldrick

A top-tier investment bank like Goldman Sachs (NYSE: GS) might seem like it would logically be a supporter of the traditionally more pro-business GOP. But the company's CEO, Lloyd Blankfein, is casting his lot behind Senator Hillary Clinton. According to a PR put out by her campaign, Blankfein said that "As a New Yorker, I have seen firsthand the outstanding work Hillary Clinton has done as a senator, proving herself to be a strong and experienced leader."

Morgan Stanley (NYSE: MS) CEO John Mack, a formerly vocal supporter of the current President's candidacy, is also supporting Ms. Clinton. So what gives?

While it would be cynical to assume that these men cast their votes solely based on the interests of their employers, that could be one factor. The Democrats have been, by and large, vocal supporters of leveling the tax playing field between large private equity firms and the investment banks with which they compete. Having a firm like Blackstone (NYSE: BX) paying less in taxes puts Mack and Blankfein at a competitive disadvantage: If two firms are bidding for a deal and one has to pay twice as much in taxes, guess who's going to be able to bid the most on the deal? As a Senator from New York, Clinton is the logical choice for these executives.

Of course John Edwards was quick to attack Clinton for being supported by an investment bank. Wait, didn't he work for a hedge fund and receive compensation in the high six-figures? Oh yeah, he did that to learn about poverty. In a related story, Barry Bonds claims he used steroids to learn about how hard it is to compete as a drug-free athlete.

Wow! That was my initial reaction when I read the Bloomberg News story about the pay accruing to Blackstone Group's top executives. And yet, compared to hedge funds, these guys are lightweights. When you look at their photos, though, you can only come to one conclusion -- it pays to be bald!

Blackstone Group LP co-founders Stephen Schwarzman and Peter G. Peterson will get $2.33 billion and keep 28% of the company after its planned initial public offering. That was interesting but what really got my attention is their pay -- Schwarzman made $398.3 million last year and will own Blackstone shares worth $7.7 billion while Peterson took in $212.9 million in 2006 and will own $1.31 billion worth of stock after the deal is done.

This seems like a nice payday but it depends on whose you compare it to. Schwarzman's pay is about 7.4 times that of Goldman Sachs Group Inc.'s (NYSE: GS) CEO Lloyd Blankfein -- who made only $54 million in 2006 and 6,638 times that of the average U.S. family which pulled in $60,000 last year.

Yet Schwarzman's $398 million is less than a quarter of the $1.7 billion that top hedge fund manager, James Simons, pulled in last year. Do you feel sorry for Schwarzman now?

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in Goldman Sachs.

It's not news that on June 27, 2007, The Wall Street Journal shall be host to some of the world's most powerful and influential business and financial professionals at their first annual Deals & Deal Makers Conference to be held at The New York Stock Exchange. With speakers including the likes of Lloyd Blankfein, CEO of Goldman Sachs Group, Inc. (NYSE: GS), Steven A. Schwarzman of The Blackstone Group, and Carl Icahn of Icahn Associates, there shall be a tremendous concentration of economic high fliers playing poker, chewing on buffalo wings and tossing back mugs of light beer.

All kidding aside though, this conference represents an extremely noteworthy gathering of power brokers. I'd give one year's wages to get a transcript of their full discussions. The event is by invitation only and you can see by this Primewire news announcement that it is extremely exclusive. They're not letting just any old straw boss in there and I assume that reporters won't be allowed near the place. I also assume that the event shall be a resounding success but shall any of us regular folks even know that?

Will they discuss the price of oil and how that is affecting their operations around the globe? Will they discuss the many ethical disruptions and legal misdeeds among the members of their peer group and what they can do to reduce that? Will they formulate a plan to persuade Hugo Chavez to disappear into the Venezuelan rain forest? Will they decide who's to be the next American president or will they just pity the one we have?

I probably won't hear one peep about what those fine people truly discuss and probably neither shall you. It is for certain though that we all shall be affected by those discussions. They're not calling it a deal makers conference for nothing you know. The question for me is what deals will they be making and just how much will we all be affected by them?

By the way, you can request an invitation to the conference via this link. Good luck!

Wondering how to make the big bucks at The Goldman Sachs Group, Inc. (NYSE: GS)? Besides hard work, talent, meeting your goals, and organizational savvy, it helps to be bald.

According to Bloomberg, GS paid its CEO Lloyd Blankfein $54 million for his work in 2006.

It also paid $53 million to both first year co-presidents Gary Cohn (on the right) and John Winkelreid (left).

One of my Wharton classmates is a Goldman Managing Director who also happens to have a shiny pate.

I'm not the first to notice this trend. Fellow BloggingStocks blogger Rick Rickertsen wrote about the same trend back in October.

Could Goldman face a class action lawsuit from its non-follically DisAbled staffers who aren't cracking through Goldman's gold-plated executive ceiling? I doubt Lloyd Blankfein will be pulling out his hair worrying about it.

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm, He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in Goldman Sachs.

Today The Goldman Sachs Group (NYSE: GS) announced that it was paying its CEO Lloyd Blankfein $54 million. I think he should get $68 million. Goldman's net income rose 70% in the last year but Blankfein's compensation is only 46% higher than that of his predecessor who oversaw 23% net income growth. When his predecessor increased Goldman's 2005 net income 23% over the 2004 level, he got a 29% boost (6% above net income growth) in compensation over 2004. So I figure Blankfein should have gotten 76% more -- $68 million. In other words, Goldman stiffed Blankfein by 21%.

How so? In 2005 Goldman's CEO (and current Treasury Secretary) Hank Paulson got $38.8 million which was up 29% from the $30 million he received in 2004. As I posted earlier, Paulson's 2005 compensation was based on many factors -- such as the improvement in Goldman's revenues (+46%), net income (+23%), earnings per share (+26%), return on equity (+ 2 percentage points), and the revenues of its business units -- Investment Banking (+9%), Trading and Principal Investments (+23%) and Asset Management and Securities Services (+23%).

Under Blankfein, Goldman's operations improved far more than under Paulson. Revenues grew 60% to $69.4 billion; net income rose 70%; earnings per share climbed 78%. Revenues of most of its business units increased much more under Blankfein as well -- Investment Banking (+42%), Trading (+105%), Principal Investments (+64%). Only Asset Management and Securities Services (+16%) was up less under Blankfein than under Paulson.

If that's not enough, under Blankfein, Goldman stock rose 58% while under Paulson, it rose a measly 20% in 2005. If Goldman's board underpays its CEO, how can shareholders be sure he'll stick around to boost the value of their investment in the future?

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm, and a Professor of Management at Babson College. He has no financial interest in Goldman Sachs.

One of the things that intrigues me about the recent Wall Street bonus payments is that top traders make twice what their CEOs get.

The reason for this is that the CEO and the trader participate in different labor markets characterized by different next-best-alternatives and different levels of performance measurement complexity. Huh? While the CEO of an investment bank's next best alternative job (at least at The Goldman Sachs Group (NYSE:GS)) is to give up money and go for the power and prestige of a government post (e.g., Treasury Secretary), the top trader's next best alternative is to leave the bank and start up a hedge fund. Moreover, a CEO's job is complex and difficult to measure whereas a trader's job is enormously stressful and relatively simple to measure.

At Goldman, for example, CEO Lloyd Blankfein is slated to take home $50 million whereas some traders, such as Morgan Sze, a head trader in Goldman's principal strategies group based in Hong Kong, are rumored to be receiving $100 million. Traders such as Sze are prone to leave to start their own hedge funds where the average of the top 100 made roughly three-and-a-half times his bonus -- or $363 million in 2005. For example, Eric Mindich, a top Goldman trader, left Goldman in November 2004 to start Eton Park Capital Management, with $3 billion under management.