Archive - Apr 27, 2010 - Blog entry

My thoughts on the Goldman hearings. Behind the circus show, there were important themes that need to be underscored.

I think he did.

VOLD (NYSE Up-Down Volume Differential) broke below 4/16 opex levels and then some today; registering the single most negative close (-1,621,467) since 3/02/09. A quick look at the S&P 500 E-mini, NYSE Tick, VOLD, VIX, ADD, UVOL & DVOL.

For those who have forgotten the implications of the highly leveraged and opaque financial holdings (the true value of which rests at the mercy of market sentiment) and can turn blind eye to the highly volatile nature of the trading revenues combined with a literal tsunami of regulatory pressure and potential litigious onslaught (all issues which we have repetitively brought up in the past as what appears to be the sole voice of contrarian reason), Goldman Sachs holds a strong investment proposition. However, if fundamental considerations such as the company’s solvency, true economic profit (not the accounting earnings you hear preached from your brokerage’s sell side marketing propaganda cum research reports) and the sustainability of income are to be considered, GS should NOT appear among the preferred lot.