Tag: Goldman Sachs

My hypothesis is that some men have no stigma attached to failure due to pure solid stupidity.  

If true, it follows that if hot plasma stupidity could be contained, cooled and compressed through the states of matter to form a perfectly arranged crystalline structure at absolute zero, solid diamond stupid should look like this:

America is the greatest engine of innovation that has ever existed, and it can’t be duplicated anytime soon, because it is the product of a multitude of factors: extreme freedom of thought, an emphasis on independent thinking, a steady immigration of new minds, a risk-taking culture with no stigma attached to trying and failing, a noncorrupt bureaucracy, and financial markets and a venture capital system that are unrivaled at taking new ideas and turning them into global products.

 – Tom Friedman, The Secret From Our Sauce, March 7, 2004

How solid is that?

According to the NYT, Goldman Sachs and other banks sold their customers collateralized debt obligations, or C.D.O.’s, and then bet heavily that these investments would fail.

Goldman Saw It Coming

Before the financial crisis, many investors – large American and European banks, pension funds, insurance companies and even some hedge funds – failed to recognize that overextended borrowers would default on their mortgages, and they kept increasing their investments in mortgage-related securities. As the mortgage market collapsed, they suffered steep losses.

“The simultaneous selling of securities to customers and shorting them because they believed they were going to default is the most cynical use of credit information that I have ever seen,” said Sylvain R. Raynes, an expert in structured finance at R & R Consulting in New York. “When you buy protection against an event that you have a hand in causing, you are buying fire insurance on someone else’s house and then committing arson.”

The woeful performance of some C.D.O.’s issued by Goldman made them ideal for betting against. As of September 2007, for example, just five months after Goldman had sold a new Abacus C.D.O., the ratings on 84 percent of the mortgages underlying it had been downgraded, indicating growing concerns about borrowers’ ability to repay the loans, according to research from UBS, the big Swiss bank. Of more than 500 C.D.O.’s analyzed by UBS, only two were worse than the Abacus deal.

http://www.nytimes.com/2009/12…

Lewis Sachs, left, who oversaw C.D.O.’s before becoming a Treasury adviser (ie he works for Geithner now) , and John Paulson, whose company profited as the housing market collapsed.:

So, basically, not only are we not regulating these guys, we’re rewarding them– and more importantly promoting them into the government to run the show–where they presumably steal directly from the US Treasury.

How is this different from what Mussilini had in mind as a system of government? Such a constant revolving of government, military, and corporate figures, that the lines are entirely blurred.  

Wall Street is sick. And its illness is Unchecked Greed. … The bug is call OPM.

Their fever has risen so dangerously high, that the Wizards of Wall Street, the Captains of Industry, for the most part see your assets as their “playing chips”.

Your Money, is their Bread and Butter.

Exploiting and Levering OPM (Other People’s Money) is the key to their  Extreme Wealth.

This contagion on Wall Street has reached such a point, that one of those “Captains of Industry” has been speaking out against it.  He has been working to “right the ship” of speculative, reckless investing, using our OPM, as the collateral.

Jack C. Bogle, founder and CEO of the Vanguard Group, is one of those “old school” investors — you know, that we should be “investing in a better future“, NOT just a “better bank account“.

Jack has listed the symptoms of this wide spread illness — NOW if only we could find some “Doctors” wise enough to quarantine the Damage …

The Damage unregulated greed has done … before they try to “go for broke” AGAIN …

 

I can’t really put it any better than Wikipedia does–

The narrative of Jesus and the Money Changers occurs in all four Gospels in the New Testament. It occurs near the end of the Synoptic Gospels (at Mark 11:15-19, 11:27-33, Matthew 21:12-17, 21:23-27 and Luke 19:45-48, 20:1-8) and near the start in the Gospel of John (at John 2:12-25). As a result some biblical scholars think there may have been two such incidents.

I’m doing ‘God’s work’. Meet Mr Goldman Sachs

John Arlidge, The Sunday Times

November 8, 2009

“Is it possible to have too much ambition? Is it possible to be too successful?” Blankfein shoots back. “I don’t want people in this firm to think that they have accomplished as much for themselves as they can and go on vacation. As the guardian of the interests of the shareholders and, by the way, for the purposes of society, I’d like them to continue to do what they are doing. I don’t want to put a cap on their ambition. It’s hard for me to argue for a cap on their compensation.”

So, it’s business as usual, then, regardless of whether it makes most people howl at the moon with rage? Goldman Sachs, this pillar of the free market, breeder of super-citizens, object of envy and awe will go on raking it in, getting richer than God? An impish grin spreads across Blankfein’s face. Call him a fat cat who mocks the public. Call him wicked. Call him what you will. He is, he says, just a banker “doing God’s work”

As you might guess from my handle and my Buddhism I reject Christianity entirely, but that doesn’t mean I don’t know it.

What Blankfein is embracing is a particularly warped and narrow view of Calvinism.

Since everything is predestined by God who knew you in the womb, your material success is an indication of God’s favor.  It shows you are among the elect.

This is sometimes also called the Protestant Work Ethic.

The richer you are the more Godly.

Now how you square this with Camels and Needle Eyes and Saul’s Unmerited Favor through Grace is a job for a real theologian.

You know, someone who believes in original sin.

(h/t Digby)

  Goldman released its trading records from the 3rd Quarter today, and it was impressive.

 (Bloomberg) — Goldman Sachs Group Inc., the most profitable securities firm in Wall Street history, reaped more than $100 million of trading revenue on 36 days in the third quarter, down from a record 46 in the preceding three months.

  The firm’s trading division lost money on only one day during the quarter, down from two days in the second quarter, according to a quarterly filing with the U.S. Securities and Exchange Commission. New York-based Goldman Sachs made at least $50 million on 53 of the 65 trading days in the period, or 82 percent of the time.

 The statistical probability of losing money on only 1 out of 65 days goes a little beyond just skill.

In this first video Greg Gordon of McClatchy News reports that Goldman knew that mortgages were not being properly reviewed

Here Paul Jay interviews Gordon who explains that a five month McClatchy investigation has found that Goldman’s failure to disclose those secret bets may have violated securities laws – that in 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers that it also was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting.

Crossposted from Fire on the Mountain

It was a rough afternoon.

At 2:00 PM yesterday, I was standing in front of City Hall in lower Manhattan, serving as an extra at a press conference for the Stella D’oro workers. After winning an arduous 11 month strike against concessions, the workers have been fighting plans by new owners Lance, Inc. to move the 78 year old bakery from the Bronx to Ashtabula, Ohio and reopen non-union.

The press conference/mini-rally had been a good one, though major media was thin on the ground, Speakers from the plant, a range of union officials and other supporters gave short sharp statements, demanding that Mayor Bloomberg do something to save Stella D’oro and its union jobs. As we were about to break up, two of the workers got hasty phone calls from the plant. Managers had told the morning shift that when they left at 3:00 PM, the bakery was shutting down!

Maybe a quarter of the 100-plus at City Hall headed up to 237th Street and Broadway, where the arriving shift had been ushered into work to empty their lockers. They were still trickling out at 3:00 when the day shift came out en masse, carrying plastic bags with whatever they had had inside. The three dozen supporters and workers outside the gate clapped as they did and there were chants that had become familiar to all from almost a year of picketing.

© Stuart Carlson