America’s best known and most controversial investment bank Goldman Sachs (NYSE: GS) has been a roll of success lately. The Wall Street legend’s influence is growing along with its income and revenues.

Goldman Sachs’ revenues have almost returned to where they were two years ago. GS reported $34.23 billion (€29.45 billion) in revenues in September 2015; that fell to $29.71 billion (€25.56 billion) in September 2016, and rebounded to $32.41 billion (€27.89 billion) in September 2017. This sure looks like a turnaround to me, but value investors will want to know if Goldman Sachs is making more money.

Is Goldman Sachs Making More Money?

That answer depends on which figure you look at on the investment bank’s financial statement. The net income has certainly increased; it went from $5.816 billion (€5 billion) in September 2016 to $8.561 billion (€7.37 billion) a year later in 2017. This figuring is approaching the high of $9.288 billion (€7.99 billion) in income, Goldman reached in March 2015.

Yet the cash from operations is dismal; it fell to -$15.28 billion (-€13.15 billion) on 30 June 2017. That’s a tremendous drop from the $9.447 billion (€8.13 billion) reported on September 30, 2016. It looks as if Goldman Sachs is able to grow its operations but not its cash flow.

Another number that should give investors pause is the -$11.17 billion (-€10.10 billion) in free cash flow reported on June 30, 2017. That makes it look as if Goldman Sachs is making a lot of money, but having a hard time keeping it. This can be good for an investment bank, because it indicates lots of long term investment.

Is Goldman Sachs a Value Investment?

Yes there is a lot of value at Goldman Sachs it reported $110.89 billion (€95.42 billion) in cash and short-term investments on June 30, 2017. There were also tremendous assets of $905.52 billion (€779.18 billion) on the same day.

There were some money making capabilities there including $14.68 billion (€12.63 billion) cash from financing on June 30, 2017. That figure is problematic because it is down from $17.92 billion (€15.42 billion) in September 2016.

Judging by the market capitalization of $94.68 billion (€81.47 billion) reported on 1 November 2017, GS is undervalued. Ycharts gave it an enterprise value of $263.17 billion (€226.45 billion) on the same day. Although the $244.73 (€210.58) a share offered on the same day looks high.

Neither the 11.28% return on equity reported on June 30, 2017; nor the 75¢ (€0.65) dividend that was scheduled for 29 November 2017, justify that price. Even the dividend growth at GS is questionable; it went up from 65¢ (€0.5593) earlier this year. I would conclude that Goldman Sachs is not a value investment right now, although it is a growth investment.

Is President Trump good or bad for Goldman Sachs?

There is a long shadow over Goldman Sachs that might hurt or help its business – that of U.S. President Donald J. Trump (R-New York).

Trump is the most unpopular and controversial political figure in the United States in generations. He is probably most unpopular president since the 19th Century.

That creates complications because his administration has become a magnate for former GS executives. Just a few of the high-profile Goldman Sachs alumni that are serving in or have passed through the Trump White House include:

• Former communications director Anthony “the Mooch” Scaramucci.

• Former chief strategist and white nationalist leader Steve Bannon.

• Director of the National Economic Council Gary Cohn.

• U.S. Treasury Secretary Steven Mnuchin.

Obviously none of these men reflect Goldman Sachs’ policies or operations; but that will mean little to angry voters or populist politicians. Many of the news articles about these guys already have the flavor of witch hunting, and there is a strong possibility the paranoia will spread to Congress at some point.

Will GS pay for Government by Goldman?

Goldman Sachs would make a convenient scapegoat for lack of economic progress, or the failure of Trump’s policies. A possibility that might hurt the bank would be Democrats taking control of either house of Congress in next year’s presidential election and using their subpoena powers against Goldman Sachs.

Media attempts to blame GS for Trump already abound. On the right The American Conservative’s Rod Dreher nicknamed Trump’s relationship with Goldman Sachs “The Con of Century.” The leftwing Intercept labeled the Trump administration “Government by Goldman.”

Such propaganda is shallow, simplistic, inaccurate, and contaminated with Antisemitism but it reflects popular sentiment in America. These articles show that even many sophisticated and well-educated Americans accept such hysterical conspiracy theories as reality. It also points to a coming witch hunt against Wall Street reminiscent of the one that President Franklin D. Roosevelt (D-New York) conducted in the 1930s.

At least one Democratic leader U.S. Senator Elizabeth Warren (D-Massachusetts) is already playing the Goldman Sachs card.

“The idea that the president is now going to turn over the country’s economic policy to a senior Goldman executive turns my stomach,” Warren; who is widely named as a potential presidential candidate, said.

Has Goldman Sachs become Trump’s Bank?

A witch hunt might not affect Goldman Sachs’ stock values but it would certainly complicate matters. One problem for GS is that it might have a hard time attracting business and getting deals in other countries if it gets the reputation as being Trump’s investment bank.

Trump is widely hated in his own country and all over the world. Even intelligent investors are likely to be leery of any institution associated with him. The popular view of the President as an incompetent clown makes matters worse. Investors and executives might wonder if Goldman Sachs decision makers are as incompetent and corrupt as Trump seems to be.

A nightmare for GS would be competitors trying to label it as Trump’s bank or racist. Goldman Sachs will need to address the Trump links and find some way to distance itself from the President. If it cannot those political ties might damage the business.

The association with Trump will not necessarily affect Goldman Sachs’ underlying value but it can certainly damage the company’s reputation. Investors had better watch news stories about Trump and Goldman Sachs closely because there will be negative effects for GS and possibly all of Wall Street from that relationship.

This article first appeared at Market Mad House.