Comments (59)

May 11, 2011

If what he wrote was true then I honestly don't know how Goldman could avoid criminal charges, and I still don't understand why the other banks still deal with them. That part about Morgan Stanley was really incredible.

May 12, 2011
awm55:

If what he wrote was true then I honestly don't know how Goldman could avoid criminal charges, and I still don't understand why the other banks still deal with them. That part about Morgan Stanley was really incredible.

Fuck that, how do they avoid civil charges. They should be acquiescing left and right.

I am not cocky, I am confident, and when you tell me I am the best it is a compliment.
-Styles P

May 11, 2011

I agree with you there, but how the fuck do you just stop doing deals with GS? That will destroy your business. Of course you could make the argument that it would fuck GS over, too.

My brain wasn't made for this, I think I'm going back to retail...

May 11, 2011
D M:

I agree with you there, but how the fuck do you just stop doing deals with GS? That will destroy your business. Of course you could make the argument that it would fuck GS over, too.

My brain wasn't made for this, I think I'm going back to retail...

Yeah, on one end I think what GS did was fucked up, but then I get a little perspective and realize it was only a select few desks (CDO traders/structurers and MBS) and not the whole firm. I think the author really fails to tell the readers that it was a small part of their S&T operation and that is pretty misleading.

May 11, 2011
awm55:

Yeah, on one end I think what GS did was fucked up, but then I get a little perspective and realize it was only a select few desks (CDO traders/structurers and MBS) and not the whole firm. I think the author really fails to tell the readers that it was a small part of their S&T operation and that is pretty misleading.

If that is true, the Levin report, ( I didn't read it, and I don't even know if it is available for public reading ), and the regulatory response should single out those who were immediately responsible & aware of the issue ( including all the names in the Rolling Stones' article).

I don't think anyone is saying GS should be shut down, but it really seems like they are going to face some severe criminal charges here.

Went from a poetry major to finance... funny how life works isn't it?

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May 11, 2011

Very interesting article. Can anyone knowledgeable about the law and practice comment about the legality of this?

May 11, 2011
09grad:

Very interesting article. Can anyone knowledgeable about the law and practice comment about the legality of this?

I don't know much about this, but there IS an inherent caveat emptor built into anything a bank sells. The bank is not at fault as long as it does not knowingly mislead its clients, but in general a client will buy a complicated structure and not understand what the hell they are doing (this is not illegal). What the author described is very much illegal, they blatantly mislead Morgan Stanley and royally fucked them over.

May 11, 2011

I still think that it shows a lot of the shadiness that goes on within GS. They're a bunch of highly intelligent people, but is this business model (where they're fucking over not only the people they work with, but their clients and customers) really going to be able to stand for years to come?

May 11, 2011

In that case, I'm curious as to why MS didn't take legal action against GS...

May 11, 2011
D M:

In that case, I'm curious as to why MS didn't take legal action against GS...

Very simple, because they were doing the exact same thing to someone else.

May 11, 2011

wow this article is f-ing crazy.....Goldman lost all my respect...they are major douche

May 11, 2011

I can't wait to hear what Eddie/Midas/Frieds/CaptK etc have to say on this... might have to PM it to one of em

May 11, 2011

The thing is, this article makes it sound like the practice was being sanctioned at a very high level of the firm. True, the trades themselves were executed on only certain desks but it seems like the guilt extends widely.

May 12, 2011

That demagoguery is total bullshit. Having watched the actual many-hour long testimony GS execs did in front of Mr. Levin's committee, I can say with 100% confidence that Levin and most members on that committee are total morons who have no idea how finance truly works.

There are essentially no fiduciary obligations when GS structures these deals. The article portrays them as car salesmen swindling people, when, in reality, they are not proclaiming to stand behind these products, they are just making a market. It doesn't matter if they already own it and they want to offload it because they think it's shit. It's buyer beware, this is not like a car or other item that has a warranty or is supposed to meet some sort of safety or performance standard. Anyone who thinks otherwise is a moron who does not belong in finance. They are not acting as an advisor to clients when they put these deals together.

Sure, GS is smarter than most anyone else in the financial marketplace, but that's not GS's fault. If some large institution like some pension plan run by an idiot wants to shoot themselves in the foot, that's their business.

Does GS do shady shit? Yes, of course. Was some of this shady? Yes, of course. Was any of it illegal or improper from a finance law perspective? Absolutely not; they did not have a fiduciary obligation (and they settled because there was arguably some grey area and a technicality disclosure-wise, but that was stupid and partisan demagoguery imo). If I'm smart enough to screw you over in a legal way, then that's my business and my right. GS did nothing wrong with regard to anything mentioned in that article, and any objective individual with a decent knowledge of financial markets and law would know that.

May 11, 2011
alexpasch:

That demagoguery is total bullshit. Having watched the actual many-hour long testimony GS execs did in front of Mr. Levin's committee, I can say with 100% confidence that Levin and most members on that committee are total morons who have no idea how finance truly works.

There are essentially no fiduciary obligations when GS structures these deals. The article portrays them as car salesmen swindling people, when, in reality, they are not proclaiming to stand behind these products, they are just making a market. It doesn't matter if they already own it and they want to offload it because they think it's shit. It's buyer beware, this is not like a car or other item that has a warranty or is supposed to meet some sort of safety or performance standard. Anyone who thinks otherwise is a moron who does not belong in finance. They are not acting as an advisor to clients when they put these deals together.

Sure, GS is smarter than most anyone else in the financial marketplace, but that's not GS's fault. If some large institution like some pension plan run by an idiot wants to shoot themselves in the foot, that's their business.

Does GS do shady shit? Yes, of course. Was some of this shady? Yes, of course. Was any of it illegal or improper from a finance law perspective? Absolutely not; they did not have a fiduciary obligation (and they settled because there was arguably some grey area and a technicality disclosure-wise, but that was stupid and partisan demagoguery imo). If I'm smart enough to screw you over in a legal way, then that's my business and my right. GS did nothing wrong with regard to anything mentioned in that article, and any objective individual with a decent knowledge of financial markets and law would know that.

I work in structured products. There is a huge difference between selling a structure that the counter party may not fully understand and lying to the counter party about what they are buying. The latter is absolutely illegal.

May 12, 2011

Oh and the best part is that this article quickly brushes aside GS defenders as if we are elitist and using legal mumbo jumbo to obfuscate the truth. Well guess what dipshit Rolling Stone reporter, real life is complicated and sometimes you have to use big words and cite complicated statutes. That does not change the fact that GS did nothing illegal. If GS had actually done something illegal, you can bet they'd be getting sued by their clients and being tried criminally. That is not occurring because they did nothing wrong. The best the government could muster was a minor technicality regarding disclosure that even if it had been in place, would have done nothing to impede GS's ability to sell these deals.

Btw, I couldn't care less if GS went bankrupt tomorrow, I have no relationship with them either professionally or personally, so I'm totally objective.

May 12, 2011

Oh and guys, this is a vitally important issue. If investment banks would have to act as fiduciaries on deals they structure, the OTC and structured products markets would essentially dry up overnight. You're talking about the collapse of a vital part of the financial marketplace.

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May 12, 2011

yea im waiting for the rolling stone expose on chuckie schum

May 11, 2011

Thanks a ton for the insight alex, definitely helps put the article in perspective

May 12, 2011

It's trendy to hate banking lately, and Rolling Stone wants to be trendy. I hope they enjoy their smug, self righteous 'trendyness'. But it's a trend, and it will pass, and GS will continue to be the best place around. But, in a few years, no one will care who Mat Talibii is [name spelled wrong intentionally]. How about Rolling Stone does an article highlighting the vile ethical cesspool that is the entertainment industry....ohhhh, right, they are the entertainment industry, I forgot that they are allowed to be hypocrits.

May 11, 2011
UFOinsider:

Political bullshit, rabble rousing, and populist 'down with the man' bullshit. A few people will inevitably be fingered, and I agree and promote the likely realistic point that SOME, as in a FRACTION of the people there crossed the line on SOME deals: but the vast majority of their business is legitimate, and there is no proof of anything. But painting the whole company in a negative light like this is totally dishonest. How about Rolling Stone does an article highlighting the vile ethical cesspool that is the entertainment industry....ohhhh, right, they are the entertainment industry. What REAL purpose do they serve? I can shut off my TV and pick up a guitar or read a book, but I can't buy food without banks and money.

It's trendy to hate banking lately, and Rolling Stone wants to be trendy. I hope they enjoy their smug, self righteous 'trendyness'. But it's a trend, and it will pass, and GS will continue to be the best place around. But, in a few years, no one will care who Mat Talibii is [name spelled wrong intentionally]

I agree for the most part. What GS did was shady as shit, but the vast majority of their business is legitimate.

May 11, 2011
UFOinsider:

Political bullshit, rabble rousing, and populist 'down with the man' bullshit. A few people will inevitably be fingered, and I agree and promote the likely realistic point that SOME, as in a FRACTION of the people there crossed the line on SOME deals: but the vast majority of their business is legitimate, and there is no proof of anything. But painting the whole company in a negative light like this is totally dishonest. How about Rolling Stone does an article highlighting the vile ethical cesspool that is the entertainment industry....ohhhh, right, they are the entertainment industry. What REAL purpose do they serve? I can shut off my TV and pick up a guitar or read a book, but I can't buy food without banks and money.

It's trendy to hate banking lately, and Rolling Stone wants to be trendy. I hope they enjoy their smug, self righteous 'trendyness'. But it's a trend, and it will pass, and GS will continue to be the best place around. But, in a few years, no one will care who Mat Talibii is [name spelled wrong intentionally]

double post

May 11, 2011

Just saying that this is a lil intense

May 12, 2011

Really can't defend that even using the usually safe 'just making a market' or 'buyer beware' caveats. This is just disingenuous.

May 12, 2011
Genesis:

Really can't defend that even using the usually safe 'just making a market' or 'buyer beware' caveats. This is just disingenuous.

You forgot the best defense- "Just doing God's work"

"Well, you can do whatever you want to us, but we're not going to sit here and listen to you badmouth the United States of America."

May 12, 2011
Matt Taibi:

A CDO, to begin with, is already a highly dubious tool for magically converting risky subprime mortgages into AAA investments. A CDO-squared doubles down on that lunacy, taking the waste products of the original process and converting them into AAA investments. This is kind of like taking all the kids who were picked last to play volleyball in every gym class of every public school in the state, throwing them in a new gym, and pretending that the first 10 kids picked are varsity-level players. Then you take all the unpicked kids left over from that process, throw them in a gym with similar kids from all 50 states, and call the first 10 kids picked All-Americans.

LMAO, what a great synopsis.

I am not cocky, I am confident, and when you tell me I am the best it is a compliment.
-Styles P

May 12, 2011

"When Goldman lost more than $100 million on August 8th, 2007, Montag circulated this e-mail: "So who lost the hundy?"

Hilarious.

May 11, 2011
derivstrading:

"When Goldman lost more than $100 million on August 8th, 2007, Montag circulated this e-mail: "So who lost the hundy?"

Hilarious.

I gotta say, that's probably one of the most badass things I've ever heard.

May 12, 2011
D M:
derivstrading:

"When Goldman lost more than $100 million on August 8th, 2007, Montag circulated this e-mail: "So who lost the hundy?"

Hilarious.

I gotta say, that's probably one of the most badass things I've ever heard.

It's funny how none of us reacted to it with the shock / horror that Taibi wanted. That line will become a classic

May 12, 2011

the question here is whether GS actually lied to clients. selling idiots crappy products is one thing, lying to them is another.

If the article is correct, and GS claimed in marketing materials to have its interest aligned with clients whilst shorting the same deal then that does qualify as lying.

May 12, 2011

Realistically, there are a number of firms who got "screwed" by Goldman with the capability to have sued them by now. I tend to agree that the people who truly understand the situation (aka the ones who were intimately involved in it on either side) have already had the chance to make their judgments and they're arguably far more qualified to do so. It's no coincidence that we haven't seen much action thus far....

May 12, 2011
Khalil:

Realistically, there are a number of firms who got "screwed" by Goldman with the capability to have sued them by now. I tend to agree that the people who truly understand the situation (aka the ones who were intimately involved in it on either side) have already had the chance to make their judgments and they're arguably far more qualified to do so. It's no coincidence that we haven't seen much action thus far....

This line doesn't make much sense since there are a number of reasons that firms would not wish to pursue a claim even if they got screwed.

  • gnicholas
  •  May 12, 2011

I just completely disagree with this article. What are they supposed to do, sit on the CDOs that they expect to perform poorly? This article, and many people who agree with it, act like Goldman sold these things to grandmothers using etrade accounts with their social security money, if MS couldn't properly analyze it then that's their fault. Goldman is just doing their job here, which is to make money, and no one would be mad if the stuff they shorted ended up going up, but since they were right they turn into the scapegoat.

May 11, 2011
gnicholas:

I just completely disagree with this article. What are they supposed to do, sit on the CDOs that they expect to perform poorly? This article, and many people who agree with it, act like Goldman sold these things to grandmothers using etrade accounts with their social security money, if MS couldn't properly analyze it then that's their fault. Goldman is just doing their job here, which is to make money, and no one would be mad if the stuff they shorted ended up going up, but since they were right they turn into the scapegoat.

They created the CDO's they expected to perform poorly, and then sold them to their client base by lying about their interests lining up. In fact Goldman had a massive short interest and expected the deal to blow up in the clients face. Again, I work in structured products and there is a huge difference between selling something to a client they may not fully understand and lying to them about what they are actually buying.

May 11, 2011

i dont think ppl are mad that they shorted the securities. they are mad that the securities were shorted even though the firm said the securities would be good; when selling the securities GS said that its interests were aligned with them, which turned out not to be true.

May 13, 2011

"So who lost the hundy?". Classic. Totally badass

Still I Rise

May 13, 2011

You know, 50 years ago the best and the brightest of America dreamed about being astronauts, scientists, doctors, and heck, lawyers. Nowadays, kids dream about being bankers. If that doesn't cause concern...

May 12, 2011
ibhopeful532:

You know, 50 years ago the best and the brightest of America dreamed about being astronauts, scientists, doctors, and heck, lawyers. Nowadays, kids dream about being bankers. If that doesn't cause concern...

There have been some 500 astronauts out into space... ever. There is a cap of ~20k new doctors per year. There are more than enough lawyers out there. Every kid who doesn't have their life figured out seems to want to go to law school. Sure, I guess we could use more scientists.

However, no kid I know ever dreamt of becoming a banker.

May 12, 2011
DontMakeMeShortYou:
ibhopeful532:

You know, 50 years ago the best and the brightest of America dreamed about being astronauts, scientists, doctors, and heck, lawyers. Nowadays, kids dream about being bankers. If that doesn't cause concern...

There have been some 500 astronauts out into space... ever. There is a cap of ~20k new doctors per year. There are more than enough lawyers out there. Every kid who doesn't have their life figured out seems to want to go to law school. Sure, I guess we could use more scientists.

However, no kid I know ever dreamt of becoming a banker.

If you had asked my 4th grade self what I wanted to be when I grew up I would've said "a stockbroker". Does that count?

May 11, 2011

I would have said banker in 4th grade, but that's because that is what my dad did. Ended up not wanting to do that and really don't now hehe

May 14, 2011

I need quick clarification. This and many other news articles for the past three years always use the following statement (it varies by article of course):

"Morgan Stanley turned around and dumped it on taxpayers, who within a year were spending $10 billion bailing out the sucker bank through the TARP program."

My question is about the word spending. Weren't the TARP funds used to bail out banks loans that were paid back to the US government with interest? Wouldn't that mean that the tax payers loan.invested on these banks and then earned a profit? why are articles three years after the crisis still referring to the use of TARP funds as spending?

May 11, 2011

Because the media in general leans liberal?

Best Response
May 17, 2011

To anyone defending Goldman Sachs, you are either a blind shill for the banks, a sociopath, or are uninformed / misunderstanding the facts.

I'm not trying to be an asshole, but if you'd actually do your homework on the topic, you wouldn't be attacking Taibbi for this article. Go to the source materials (the Levin-Coburn report, which is bi-partisan, btw) and read up. The sheer amount of information that was collected and analyzed and literally spelled out over hundreds of pages is unbelievable. And all of it is based on internal company documents, public filings, and testimony given under oath. The report is both gripping and frustrating. Gripping because, even 3 years later, it has tons of eye opening information. Frustrating because it is so clear that the current state the global economy is in could have been prevented and many of the players (like guys at WaMu and Countrywide, for instance) were absolutely aware of what they were doing any figured they could play hot potato and walk away rich.

However, if you want to continue living in an alternate reality where Goldman did nothing wrong, then fine. I used to argue with people about this shit for hours, but it's just not worth it. If some asshole is going to be presented the facts and ignore them, or not even look into the facts, then they're never going to change their minds about anything. It's these fucking shills that have truly made me grow to hate this industry. It's honestly pathetic that people who are so highly educated and book-smart can be so incapable of self-reflection and criticism of themselves and the industry at large. And honestly, even if you want to really push the argument of legal gray areas (which you really can't here, but let's say you can), then where is the integrity? Put aside bank and profit worship and think about all of this from an integrity perspective. I don't know about any of you, but I wouldn't sell my integrity for any price, cause I know I couldn't sleep at night if I compromised it.

May 11, 2011
TheKing:

To anyone defending Goldman Sachs, you are either a blind shill for the banks, a sociopath, or are uninformed / misunderstanding the facts.

I'm not trying to be an asshole, but if you'd actually do your homework on the topic, you wouldn't be attacking Taibbi for this article. Go to the source materials (the Levin-Coburn report, which is bi-partisan, btw) and read up. The sheer amount of information that was collected and analyzed and literally spelled out over hundreds of pages is unbelievable. And all of it is based on internal company documents, public filings, and testimony given under oath. The report is both gripping and frustrating. Gripping because, even 3 years later, it has tons of eye opening information. Frustrating because it is so clear that the current state the global economy is in could have been prevented and many of the players (like guys at WaMu and Countrywide, for instance) were absolutely aware of what they were doing any figured they could play hot potato and walk away rich.

However, if you want to continue living in an alternate reality where Goldman did nothing wrong, then fine. I used to argue with people about this shit for hours, but it's just not worth it. If some asshole is going to be presented the facts and ignore them, or not even look into the facts, then they're never going to change their minds about anything. It's these fucking shills that have truly made me grow to hate this industry. It's honestly pathetic that people who are so highly educated and book-smart can be so incapable of self-reflection and criticism of themselves and the industry at large. And honestly, even if you want to really push the argument of legal gray areas (which you really can't here, but let's say you can), then where is the integrity? Put aside bank and profit worship and think about all of this from an integrity perspective. I don't know about any of you, but I wouldn't sell my integrity for any price, cause I know I couldn't sleep at night if I compromised it.

kudos

May 17, 2011
TheKing:

To anyone defending Goldman Sachs, you are either a blind shill for the banks, a sociopath, or are uninformed / misunderstanding the facts.

I'm not trying to be an asshole, but if you'd actually do your homework on the topic, you wouldn't be attacking Taibbi for this article. Go to the source materials (the Levin-Coburn report, which is bi-partisan, btw) and read up. The sheer amount of information that was collected and analyzed and literally spelled out over hundreds of pages is unbelievable. And all of it is based on internal company documents, public filings, and testimony given under oath. The report is both gripping and frustrating. Gripping because, even 3 years later, it has tons of eye opening information. Frustrating because it is so clear that the current state the global economy is in could have been prevented and many of the players (like guys at WaMu and Countrywide, for instance) were absolutely aware of what they were doing any figured they could play hot potato and walk away rich.

However, if you want to continue living in an alternate reality where Goldman did nothing wrong, then fine. I used to argue with people about this shit for hours, but it's just not worth it. If some asshole is going to be presented the facts and ignore them, or not even look into the facts, then they're never going to change their minds about anything. It's these fucking shills that have truly made me grow to hate this industry. It's honestly pathetic that people who are so highly educated and book-smart can be so incapable of self-reflection and criticism of themselves and the industry at large. And honestly, even if you want to really push the argument of legal gray areas (which you really can't here, but let's say you can), then where is the integrity? Put aside bank and profit worship and think about all of this from an integrity perspective. I don't know about any of you, but I wouldn't sell my integrity for any price, cause I know I couldn't sleep at night if I compromised it.

Can't be quoted enough.

Sure we're all interested in this industry, but it doesn't mean you should blindly ride the bandwagon.

May 12, 2011

sb for king

May 12, 2011
TheKing:

To anyone defending Goldman Sachs, you are either a blind shill for the banks, a sociopath, or are uninformed / misunderstanding the facts.

I'm not trying to be an asshole, but if you'd actually do your homework on the topic, you wouldn't be attacking Taibbi for this article. Go to the source materials (the Levin-Coburn report, which is bi-partisan, btw) and read up. The sheer amount of information that was collected and analyzed and literally spelled out over hundreds of pages is unbelievable. And all of it is based on internal company documents, public filings, and testimony given under oath. The report is both gripping and frustrating. Gripping because, even 3 years later, it has tons of eye opening information. Frustrating because it is so clear that the current state the global economy is in could have been prevented and many of the players (like guys at WaMu and Countrywide, for instance) were absolutely aware of what they were doing any figured they could play hot potato and walk away rich.

However, if you want to continue living in an alternate reality where Goldman did nothing wrong, then fine. I used to argue with people about this shit for hours, but it's just not worth it. If some asshole is going to be presented the facts and ignore them, or not even look into the facts, then they're never going to change their minds about anything. It's these fucking shills that have truly made me grow to hate this industry. It's honestly pathetic that people who are so highly educated and book-smart can be so incapable of self-reflection and criticism of themselves and the industry at large. And honestly, even if you want to really push the argument of legal gray areas (which you really can't here, but let's say you can), then where is the integrity? Put aside bank and profit worship and think about all of this from an integrity perspective. I don't know about any of you, but I wouldn't sell my integrity for any price, cause I know I couldn't sleep at night if I compromised it.

I think a lot of people view the whole situation as very bi-partisan without any middle ground... ie, they seem to think you have to be pro-Wall Street or very much against it (ie, all bankers are evil, bla bla bla). When you view it that way, you don't accept / process any facts that run counter to your beliefs and quickly start looking ignorant to those like yourself that have done their fair share of research. It's that "us vs. them" mentality that makes the debate so difficult to engage in. Plus, when you're surrounded by other finance folk, it's difficult to voice your opinions against the very industry you all work in.

You're not alone in your views. You'd be surprised by how many are cognizant of the shit that goes on and don't approve it, but keep silent in favor of career progression. Hell, I haven't even done all that much research on the subject, but just from first-hand experience am very aware of the shit that goes down behind closed doors. It's astonishing, really. I only really voice my discontent to close friends though. I also keep my mouth mostly shut on the board because I haven't done enough research to make convincing and well thought out arguments.

May 12, 2011
DontMakeMeShortYou:
TheKing:

To anyone defending Goldman Sachs, you are either a blind shill for the banks, a sociopath, or are uninformed / misunderstanding the facts.

I'm not trying to be an asshole, but if you'd actually do your homework on the topic, you wouldn't be attacking Taibbi for this article. Go to the source materials (the Levin-Coburn report, which is bi-partisan, btw) and read up. The sheer amount of information that was collected and analyzed and literally spelled out over hundreds of pages is unbelievable. And all of it is based on internal company documents, public filings, and testimony given under oath. The report is both gripping and frustrating. Gripping because, even 3 years later, it has tons of eye opening information. Frustrating because it is so clear that the current state the global economy is in could have been prevented and many of the players (like guys at WaMu and Countrywide, for instance) were absolutely aware of what they were doing any figured they could play hot potato and walk away rich.

However, if you want to continue living in an alternate reality where Goldman did nothing wrong, then fine. I used to argue with people about this shit for hours, but it's just not worth it. If some asshole is going to be presented the facts and ignore them, or not even look into the facts, then they're never going to change their minds about anything. It's these fucking shills that have truly made me grow to hate this industry. It's honestly pathetic that people who are so highly educated and book-smart can be so incapable of self-reflection and criticism of themselves and the industry at large. And honestly, even if you want to really push the argument of legal gray areas (which you really can't here, but let's say you can), then where is the integrity? Put aside bank and profit worship and think about all of this from an integrity perspective. I don't know about any of you, but I wouldn't sell my integrity for any price, cause I know I couldn't sleep at night if I compromised it.

I think a lot of people view the whole situation as very bi-partisan without any middle ground... ie, they seem to think you have to be pro-Wall Street or very much against it (ie, all bankers are evil, bla bla bla). When you view it that way, you don't accept / process any facts that run counter to your beliefs and quickly start looking ignorant to those like yourself that have done their fair share of research. It's that "us vs. them" mentality that makes the debate so difficult to engage in. Plus, when you're surrounded by other finance folk, it's difficult to voice your opinions against the very industry you all work in.

You're not alone in your views. You'd be surprised by how many are cognizant of the shit that goes on and don't approve it, but keep silent in favor of career progression. Hell, I haven't even done all that much research on the subject, but just from first-hand experience am very aware of the shit that goes down behind closed doors. It's astonishing, really. I only really voice my discontent to close friends though. I also keep my mouth mostly shut on the board because I haven't done enough research to make convincing and well thought out arguments.

Deep respect for this view. I wish to build on it:

GS is merely the lightning rod of current 'controversy', and an easy target for hacks looking for a scapegoat. This does not excuse their "legal but unethical" approach, but they are by no means the worst behaving party in the fiasco: simply the most visible, successful and easy to demonize. I do not work there or have any loyalt to them, but neither am I jumping on any simple minded bandwagon. Other firms are loving the public trashing that they are getting largely because it makes their own lives easier and takes the heat off of them: and they were doing the exact same thing as GS, but GS did it better.

When I think US housing 2002-2007, I think tulips in Denmark circa 1635. The entire system: banks, gov't, home buyers, developers, EVERYONE playing the housing market got caught in a bubble. Now, it's largely a finger pointing game with everyone trying to get what they can out of everyone else. I do sympathize with the average person who got burned, especially the innocent bystanders: but hating a bank isn't going to fix their lives. As for omniscient moral outrage: where is Rolling Stone's article covering Glencore's mineral deals with third world dictatorships? Where was their foresight in predicting anything, let alone the housing explosion? And what realistic solution are they offering other than jail a few bankers while whipping the public into a frenzy?

May 17, 2011

@UFO:

Very quickly because I'm so sick and tired of defending my views on this issue. But:

--Glencore wasn't bailed out by the taxpayer (and "GS paid back TARP" isn't a viable response to that since GS got over $12 billion via the backdoor bailout of AIG and there were many other programs put in place like TALF that basically gave them free money)

--Actually putting people who did illegal things in prison is a good thing. Being a wealthy banker should not protect you from prison when you've done wrong. Being rich does not make you above the law. Putting a couple of these dbags in a legit asspounding prison would be a better deterrence to serious white collar crime than fines to their firm. Let's be clear, GS got fined $550 million...well, really, we paid the fine for them via the AIG bailout, so there's no reason for them to change their behavior after that sort of slap on the wrist

--And honestly, the fact that you are framing this as "hating a bank" just shows that you haven't really dug into the facts here. I've seen a lot of your posts on here and you're a very reasonable guy, so I'm surprised to see you take these views. Not every firm was doing what GS was doing, not even close to any of them. They saw they had dogshit on their books, marketed the dogshit as solid investments, and made "the big short" (their own words) against the "unicorns and white elephants" (again, their own words) that took the bait.

May 12, 2011
TheKing:

@UFO:

Looking back on my earlier post, Ive come to the conclusion that drinking about a quart of coffee this morning affected my judgement. The tazmanian devil has left the building. Personally, I just don't like Rolling Stone, so that's just me.

May 11, 2011

I just blame everything on the government. It's easier that way.

May 17, 2011

Ha, I also had a lot of coffee today. Sorry if I came off a bit harsh.

::brews another cup::

May 12, 2011
TheKing:

Ha, I also had a lot of coffee today. Sorry if I came off a bit harsh.

::brews another cup::

Most of the time I pride myself on being civil+rational, but there are days when I just let it rip.....and almost always regret it.