Goldman Sachs Expected to Post $2B Profit

Goldman Sachs is expected to announce huge profits when it reports its second-quarter earnings -- many analysts expect a profit of $2 billion. In this troubled economy, just how did they do it?

Goldman Sachs headquarters at 85 Broad Street in New York. Stocks surged Monday, with Goldman Sachs joining a broad rally in the financial sector.

(Chris Hondros/Getty Images)

"They've taken bets. They put their money behind those bets, and they've made a tremendous amount of profit," said Seamus McMahon, president of McMahon Advisory LLC.

Investors are interested to see if massive bailouts helped banks get their finances back in order. Goldman Sachs will be the first major U.S. bank to report its earnings, followed by JPMorgan Chase, Bank of America and Citigroup later this week.

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Aside from banks, Intel, the world's largest chip maker, will also report its earnings Tuesday, followed by Google on Thursday.

The Treasury spent more than $200 billion to bail out financial institutions, $10 billion of which went to Goldman Sachs. They have since paid it back.

However, taxpayers may still question whether these profits are a direct result of their tax dollars.

"Why are they allowed to make this kind of money, and when are we, the taxpayer, going to see our money back?" said McMahon.

"The American taxpayer did actually help fuel this trading profit… the money stabilized the firm at a time when it needed to be stabilized. But they should take heart, on the other hand, because someone is actually making money in this environment despite the risk -- and that is good for the economy," said Charlie Geisst, author of the book Collateral Damaged.