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You are conflating the investment banker and the equity research analyst, which have legally mandated information sharing firewalls. Also this potential conflict is clearly and openly disclosed, e.g. "This company publishes research and also seeks to do investment banking business with Tesla".

Further, Goldman conducted a secondary share offering for Tesla as recently as summer 2015, so it was exceedingly obvious to anyone who makes investment decisions based on the research that this conflict exists.

I have worked at several wall street firms and also worked for firms in silicon valley, and I frankly noticed more numerous and blatant conflict of interest situations in silicon valley.

EDIT/UPDATE: Prominently displayed in large font on page 1 of the Goldman research report on Tesla:

"Goldman Sachs does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision."




Shouting "I have a massive conflict of interest" at the top of my lungs does not negate the fact that I should not be trusted.


No, but it makes it clear to what might be an otherwise unaware reader that that's the case, which is the whole point.

Also, even if I don't trust you, your research paper might still be informative.


I thought it was an ancient quandry, but it appears the quintessential description was only penned in 1954

https://en.wikipedia.org/wiki/The_Scorpion_and_the_Frog


I would say more similar to the farmer and the viper. There's only one party that's getting the bad end of the deal.

https://en.m.wikipedia.org/wiki/The_Farmer_and_the_Viper


No contest to the claim that there are conflicts of interests in silicon valley, but the firewall / chinese wall between research and banking groups is pretty spotty, despite all the formal processes to try to maintain it.

Personally saw tons of sketchy things going on with MDs on IB side influencing research analysts ratings.





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