Saturday, December 26, 2009
Vampire Squid Smacked Again
"One of the biggest disconnects on Wall Street today is between the way Goldman Sachs [GSG] sees itself (they're the smartest) and the way everyone else sees [GSG] (they're the smartest, greediest, and most dangerous). ... And Buffett has said that while no one could ever understand the balance sheet of any Wall Street firm, he has confidence that [Lloyd] Blankfein is both very smart and very conservative. But there was another reason he invested: 'If I didn't think the government was going to act, I would not be doing anything this week,' he explained to CNBC's Becky Quick. 'I might be trying to undo things this week.' ... Widespread rage. 'Complete crap,' says a former [GSG] managing director. Even Neel Kashkari, a former [GSG] banker, who became assistant secretary of the Treasury last summer, told the [NYT] that 'every single Wall Street firm, despite their protest today, every single one benefited from our actions. And when they get up and say, "Well we didn't need it" that's bull.' ... Despite the public financial statements that [GSG] files evey quarter, no outsider can tell how the firm really makes its money. ... In the aftermath of the crisis, criticism erupted that [GSG] had continued to sell mortgage-backed securities to its clients while betting against those very sercurities for its own account. ... But a less generous interpretation was given in a recent McClatchy Newspapers series, which quotes an analyst report that describes [GSG] as being 'solely interested in pushing its dirty inventory onto unsuspecting and obviously gullible investors.' ... When I ask Gary Cohn is he was worried about [GSG's] stock price, which plunged from $207.78 in Ferburary 2008 to $47.41 in November, he says, 'It wasn't scary at all.' 'Complete and utter nonsense,' says someone who knows Cohn well. ... For all [GSG's] tough talk, when the market made a judgment on [GSG] itself, the firm blinked. ... A memo written by Joseph Cassano, the former head of the AIG financial-products division, shows that some of the securities [GSG] insured with AIG were created by none other than [GSG] itself", my emphasis, Bethany McLean at Vanity Fair, January 2010: http://www.vanityfair.com/business/features/2010/01/goldman-sachs-200101?printable=true.
PriceWaterhouseCoopers (PWC), did you read this? Preet Bharara, did you read this? Where are some indictments of Vampire Squid executives for securities fraud? Like Alice in Wonderland, "stuff and nonsense", Cohn.