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Guest Post: The WSJ Blankfein Interview
Submitted by reader Deadhead
This weekend’s WSJ interview with Lloyd Blankfein of Goldman Sachs by Holman W. Jenkins, Jr. is worthy of commentary by both sides of the Goldman fence: those that subscribe to the theory that Goldman is the Matt Taibbi coined “..great vampire squid..” or those that have taken Mr. Blankfein’s recent public apology to heart and have accepted his words that “…Goldman wants to be a force for good…”.
The first impression of this writer after reading the piece is that perhaps Mr. Jenkins should have his own television show ala Chis Matthews named “Softball”. Where in the world are the “sweat” questions or follow ups to the theme outlined by Mr. Jenkins himself about “The Bank Everyone Loves to Hate”? The political and financial world is abuzz with overwhelmingly negative opinion about Goldman and its actions, yet Mr. Blankfein is barely nudged to address these matters nor does he or Mr. Jenkins offer examples of positive opinions or enthusiastic defenses of Goldman’s behavior.
The best we get on a macroscopic level is that Mr. Blankfein is “…more bemused than hurt by the slurs.” Instead of dissecting and pressing for elucidation of Blankfein’s bewilderment, Jenkins simply concludes that Blankfein’s “…serenity may be helped by the fact that the events we’re discussing - Goldman’s brush with death - appear to be firmly in the past.” Looks to me like Blankfein got a complete pass on the central theme of the article and the pervasive anti-Goldman zeitgeist. Oh, and as for that “…brush of death….firmly in the past” thing, isn’t that what has been suggested previously by some about Bear Stearns, Lehman, or, for those with a sense of history that lasts longer than the speed of a HFT trade, some of the companies previously on the Goldman conviction buy list from the dot com bust era?
The next item covered is the role of former “Goldmanites” in top echelons of the government, which has lead to an explosion of press coverage and blog chatter about numerous suggestions (often labeled as “tin foil hat conspiracies”) as well as allegations of conflict of interest and influence peddling. Yep, it was addressed. That’s about it. Really. One paragraph. Read it yourself. In the one paragraph, Jenkins indicates that Blankfein does not think Goldman is pulling strings. Okay, it’s a nice autumn day, so “Let’s play Softball!”
As to the financial crisis recap, there are a few items that caught my attention that readers might find interesting and worthy of comment.
Blankfein admits that he was “scared” during the financial crisis and if the financial system had collapsed, that Goldman “…would have been in that snowball tumbling down the hill with everybody else.” Curiously, Blankfein immediately goes on to “insist”, according to Jenkins, that Goldman was not especially at risk. To those Goldman critics who suggest that Goldman would have failed, Blankfein responds “I don’t think so. Our liquidity was huge.” Does anybody see a bit of a disconnect here?
Blankfein continues to insist that Goldman did not need TARP money, no surprise in that statement, as he and his peers have said this almost as frequently as Tim Geithner has vowed support for the US Dollar. He also reiterates that he regrets that Goldman could not have kept a greater distance from bailout efforts. Yet, when it comes to the FDIC-guaranteed debt program (bailout? Subsidy?), Blankfein boasts about Goldman being “..overachievers..” and as such, being the first bank to dive right in to the government backstopped, lower interest rate borrowing honey pot. Admitting that he did not foresee this government largesse as a “pejorative” (I think this means that taxpayers are getting really pissed off that banks like Goldman are making a fortune in the markets right now levered up with low cost money courtesy of the risk assumed by the American taxpayer), Blankfein expresses his joy at stopping at the 22 billion bucky mark. Says Blankfein: “I wish we’d stopped at zero.”
Lloyd, your wish can be granted! On Monday morning, put out a press release that Goldman will go to the capital markets immediately (a vital “social” role as you describe it) and Goldman will borrow money at current market rates to pay off the FDIC backstopped bonds and relieve the American taxpayer of the risk that we are currently assuming. Poof!! Your wish is granted.
Blankfein continues along the timeline of the crisis and notes that Goldman has had a long standing application before the Fed to become a bank holding company, which would allow Goldman to disassociate itself from its primary regulator, the SEC. I find remarkable what follows and so there is no confusion, I will quote verbatim the passage as written by Jenkins summarizing Blankfein on this bank holding company application: “The SEC’s imprimatur, he says, had become worthless after the Bear Stearns and Lehman debacles.”
Blankfein continues, in a direct quote: “What it looked like at the time was, the Fed had regulated its institutions well, and its validation was a good imprimatur. And the SEC had failed in its supervision, and its validation wasn’t good”.
Wow……… “worthless”, “failed”, and “its validation wasn’t good”. Hmmm, no comment here by this writer, I’ll wait for the forthcoming morsels from ZH and non ZH readers alike. I wonder if we will hear from those currently or previously employed by the SEC?
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Goldman's PR company scoured the media for a journalist who had credibility within the ranks of those who were suspicious of Goldman's dealings. Who better than Holman Jenkins? Perhaps Mr. Jenkins was given assurance of being considered for a Pulitzer prize in journalism - he would certainly have my vote in the 'fiction' category.
http://www.opinionjournal.com/columnists/hjenkins/bio.html
Lloyd is trippin balls.
All glory to the hypno-squid!
!@#%%!%!^!^!!
"Reason by degrees submits to absurdity as the eye is in time accommodated to darkness.'' - Samuel Johnson
Bank=Banks
There is no distinction between them, one for all all for one.
TD - Blankfein may well be truthful with his comments on TARP. After all, there was AIG, a bank holding company license with all of the fed access that goes with it, debt guarantees and the list goes on. In essence, TARP was a smoke screen for Goldman with the real prizes being the government sponsored demise of most of its rivals coupled with the gift of the government looking at the hedge fund like a bank that needs neither the FDIC or the OCC.
I still think this particular article speaks volumes as a poker tell on how GS and its sponsors view the landscape and the structure of the interview identifies some noteworthy aspects to review.
What a surprise...the MSM again provides it's main product of late....sewage.
Anon comes out as Miyagi_san, I promise to keep the white noise down and I wont get in PE pissing matches. I'm a grad of yahoo boards and seeking alpha high school. Destiny is pulling like the giant squid sucking the juices out of crabs head.
Sure Blankfein can be smug, he's got UST watching his back.
interesting post at Ritholtz today on political contributions and TARP
http://www.ritholtz.com/blog/2009/10/total-campaign-contributions/
and an uplifting article from Martin Wolf
A second Great Depression is still possiblehttp://blogs.ft.com/economistsforum/2009/10/a-second-great-depression-is...
Sorry for the OT, but are there any theories/thoughts on the lack of bank closures on Friday?
Pretty simple. FDIC ran out of cash. They got a helluva overdraft fee. Figuring out now how to ask Goldman for a loan.
the obvious being the FDIC's DIF is broke or just about there.
add to that:
* on any pending closure (umm, there's 500 or so that the FDIC estimates, so, it's probably more like 1000, excluding, naturally, the TBTF cabal), the FDIC has to negotiate with potential buyers, which can be a time consuming process. in my view, it's supply/demand and there probably aren't many buyers out there.
* I would add from an operating viewpoint, I imagine the staff at the FDIC has been overwhelmed. They have been on a hiring spree due to their "increased business".
* part of it must be the "kick the can down the road" mentality, which has been absolutely mastered by most agencies and departments of the US government.
* keep in mind the 'confidence' game. the more banks are put into receivership, the better the chance that the MSM latches on. Did someone say potential bank runs?
I hope he gets a toomah.
Well, 1931 it was Bank of the United States which went bankrupt..
http://www.youtube.com/watch?v=JKJTa0ZKIno
Wonder if he'll be so bemused and serene when GS bankers start getting dragged into the streets and beaten.
Thanks, Deadhead, for a great heads-up on the Jenkins’ profile of Goldman’s Blankfein in the weekend WSJ. Good job. The major significance of this story, of course, is that Holman W. Jenkins, Jr. is on the Wall Street Journal’s payroll. It may be labeled “opinion” but two facts are clear. One, an interview is normally received as news and, two, it is positioned as staff-written WSJ opinion. As such, one can only believe that Murdoch’s new influence has raised its head at this early stage and no one can make me believe that this piece can appear in the Journal without the complete approval of the WSJ ownership.
As for Blankfein and Goldman, there’s no dispute about the tyranny and dominance in a criminal way that they hold over of the nation’s financial system, calling the shots on the US economy through the Treasury and the Fed and the Oval Office. What’s more, who will dispute that no individual can be elected president of the United States without this private company’s approval? Who will dispute that the banking committees of the House and Senate march to every direction of Goldman’s lieutenants? And it’s a matter of record that Goldman officials and alumni occupy most every single influential government post from New York to Washington and in every key international agency such as the World Bank.
In short, our nation’s financial policy, its foreign policy and its domestic policy are all in the grip of one, highly poisonous syndicate dominated by Goldman. It is a national disgrace that any publication with national and international distribution such as the WSJ would surrender its total objectivity to kiss the feet of the emperor.
This sounds like the same sniveling and whining. We heard from Ben the other day. He's in lala land!?! He just doesn't get it. There is no place for folks like him in bamaland. As much as I hate bo. Reality is what it is.
Can anyone please explain to me why GoldmanSachs is allowed to be a financial holding company with access to the Fed window at Zero percent interest?
good question. I would like to see Mr. Blankfein answer that in a ZH webcast or in an article on ZH. I can't speak for ZH, but I imagine that they would allow Blankfein to publish his thoughts here.
90 days worth of "liquidity" ?
More to that point, I would like to know why there hasn't been any corresponding change in Goldman's or Morgan's business model. When they were granted holding company statuts, the speculation was that they'd be forced to change their business significantly -- e.g., that J Aron and MSCG might be curtailed considerably. I have seen no change. Were they granted a longer period of time to make the required changes, or given exemptions? Is it possible for them to now reverse their election to become holding companies?
So he lied about a bunch of stuff and never wants anyone to know exactly what he was lying about? Huge liquidity never would have failed we are all in this together snowballing down a hill. It just doesn't get any crazier.
"Goldman Sachs is scum" -Max Keiser
If China defaults on enough derivatives then they could put this scum out of business.
Goldman will never be a "force for good". They are driven by greed, pure and simple, and will act accordingly to crush anyone in its path.
I have done a ton of business with Goldman in the past.
Never again - LLoyd can just go fu*k a goat.
Gasparino just published an article about the Goldman bonus matter. Here's a snippet:
Van Praag, however, wouldn't deny that senior executives at the firm are discussing bonuses—including an increased portion being paid in stock and more of the money devoted to charity.
Another way Goldman is looking to deal with the image issue is to have Blankfein, normally one of the more reticent CEOs on Wall Street, increase his public profile and give selective interviews.
Well, Mr. Van Praag, you will be hard pressed to get more of a softball interview than the Jenkins piece in the WSJ. What's next? Will Blankfein sit down with a features writer from the American Banker's Association? How about a hard hitting interview with another GE media employee, say, Liesman, or perhaps a much tougher Larry Kudlow?
LB....I'm an older guy like you and let me tell you from experience, those PR stuffed shirts like Van Praag and Canady ain't gonna help your cause with the tired old "come out like a nice guy and everybody will forget the overwhelming negative allegations about GS" playbook. It just ain't gonna work because there are WAY TOO MANY people chasing down Goldman. If you are interested in what will work, I'll give you a freebie in 2 words: TRUTH, DISCLOSURE. Novel thought? Yes. In the particular case of Goldman Sachs, as the overwhelmingly personified "vampire squid", it's the only chance you have to establish credibilty. Frankly, I am not at all optimistic that GS or any of its peers on Wall Street are going to change their paradigm of operations, it will likely be changed for them by dissemination of the truth to the American people, which is clearly happening. Perhaps the day will arrive when GS customers begin to tire of the same old, same old???? That'll get your attention.
The WSJ interview is a case in point where you blow it on credibility, to wit: A). as noted in the article on this thread, you came out with the chest pounding 'Goldman didn't need TARP money, we didn't need taxpayer's help', yet you are still on the government mammaries sucking away on the low interest FDIC guarantee. A real journalist would ask you how you can possibly reconcile this crap. If you want start a dialogue with and garner credibility from the American people, cut the crap and IMMEDIATELY pay off the freakin' FDIC guaranteed bonds and go out and borrow money like a big boy. If you don't do this, you continue the hypocrite game.
I challenge you, in your own words, preferably on live TV or, better yet, with Tyler Durden of Zero Hedge in a webcast, make your case defending the many allegations lodged against Goldman from conviction buy list trick plays to frontrunning to, well, there are quite a few. Your answers and actions, or lack thereof, to these kind of issues will determine the course of Goldman's image.
Lloyd's interviews are a dog and pony show. Don't underestimate him. What type of person makes it to CEO of GoldmanSquid?
http://www.cnbc.com/id/33270112
In other words, the WSJ interview wasn’t the Journal’s idea; it was Goldman’s idea. Kinda shows who’s in charge, don’t it? Gives ya faith, in the media…
I'll cast a vote for Dylan Ratigan interview...who at least appears to not be a toothless pit bull & might ask some good questions.
did Charlie forget to plug his new book ?
Goldman will always pursue what's in the best interest of Goldman. Realistically, do you think there will ever be any alternative evidence to suggest otherwise? It has always been the M.O. of corporate America to maintain a public persona while simulataneously pursuing a self-serving private agenda. Capitalism is about competition. And Goldman will pursue its own ends. Always.
dirtbag
How do you say, "vampire squid" in Madarin? I expect you ain't gonna being saying it for long.
Thank God for the Ratigans, Ritzholtz, Durdens, etc. who are keeping the flame alive. Literally our way of life is at stake. Either the current excesses are curbed or our democracy will fail. At this point I would readily accept a benevolent totalitarian government to the corrupt democracy that is in the pockets of the banks.
A "force for good"? Bullshit and they know it!
Vampire squid, Old Bay and some hot sauce. Mmm, mmm, mmm.
I wonder how many more writers Taibbi is going to piss off before the brouhaha over his 'vampire squid' article is over? I never dreamed how much his writing pisses off hacks like Jenkins just because no one quotes THEM. It's telling that they don't even try to be a better writer than Matt but instead simper they're a better person. "See, you 'cherubic and youthful' Mr. Blankfein? I'm not the least bit rude." Yuck.
Kind of o/t, but this is a really impressive intereview...not really the goldman angle but covers the whole big bank issue
http://www.pbs.org/moyers/journal/10092009/watch.html
His name is BLANKFEIN for Cristsake.
What more need be said?
This is TomJoad (can't seem to log on via SATCOM)
Oh BTW,
"Jump you Fuckers!"
All part of a move, whether or not desperate, to address what the GSers perceive as a threat - the continued focus of far too many sheeple on their activities, status, influence, benefits, power and profits. The WSJ is part of the captive regulatory and political "service" ring that surrounds the inner core of power, and thereby serves at their whim. You would never read anything in this interview that has the faintest resemblence to the truth. Nor would Blankfein or anyone at GS ever even think of answering the most obvious question: why are you on the governemnt teat? The answer is not "why not," or "because everyone else is" - it's "because we set it up that way, silly!"
Goldman is nothing more than a particularly high profile form of the pond scum lifeforms parasitically attached to our Brave New World. Comes the Revolution, they will fall like anyone else.
LB...
The amazing thing to me is that so many on the right/conservative side detest Goldman and understand what is going on. Scarier for Goldman should be that the left/progressive group that adores Obama, has only one big beef with him: Goldman Sachs and the Fed, Treasury cabal. I know you are aware of this because Van Praag and Canady are probably freaking every time they open up HuffPo and see the vitriol consistently displayed on the front pages and the business section. Wow, see what happens when the American people figure out who is screwing with them?
Your teeball game recap from the WSJ is in HuffPo tonight. Take a run through some of these comments (link below) if you got the stones to do so. Yikes, I always thought the libs were pacifists but they are starting to sound more like the wingnuts up in the hills of Montana. You have a major perception problem (very well deserved, you only have yourself and the Goldman, Bear Stearns, Lehman, Madoff, Stanford, Enron, ad infinitum, to blame) that is not going to go away. Only the truth and disclosure will end it. As I said before, the truth and disclosure will likely not come from the Goldmans of the world, but it will come from the American people dragging it out.
here's the link. http://www.huffingtonpost.com/2009/10/11/blankfein-interview-goldm_n_316553.html Read some of these comments (again, this is from Obama's worshippers)...there is some scary shit in there.... these folks are at the tipping point and Barry, Rahm, and Dave Alexrod know it.....they are going to have to satisfy some of the blood lust coming from their base if they want the midterms and the big tamale again 2012....they might just have to really eat you guys up, not that silly shit like O's speech at Federal Hall.....I think Benny boy might have some real problems too, don't you think? Tim's toast already, that's a no brainer.... what the hell are you going to do if they put a real tiger in the SEC? I'll bet the staff there would just start foaming in the mouth with a real leader, don't you think, particularly after your "failure" and "worthless" comments about what they do for a living every day?
Goldman Sachs wants to be a force for good?
BWAHAHAHAHAHAHAHA.
Ok, so when are they going to go Jim Jones and commit group suicide, shortly after modifying their wills to give all their wealth to orphanages in Iraq, Afghanistan, and Palestine?
I am Chumbawamba.
I heard a quote the other day by Victoria Gotti in the NY Post talking about her father which went something like this..."If I robbed a church and the steeple was sticking out of my ass...I'd deny it."
Do you think Lloyd took the same class in school with John? Bigger steeple, same concept.
there is a chance lloyd blankenfein gets murdered by an angry person. it would be like throwing a dog a bone. the banking system would go on, and the small sacrifice of lloyd to the blood thirsty masses would be sufficient to calm them for a substantial period. there would be no blow back, except more rich people would start thinking about their personal security, which they probably should already be doing if they are not. also, the nutjob would be put in jail or killed himself.
the scenario is possible.
the masses cannot be trusted, they are the white lotus. they will not go down like falun gong. not with all the guns they have.
The more the Squid boss calls on the MSM to plead his BS rags to riches case the worse it will be for him in the end. Anyone see the Pravda errrr......Time mag article on him from 1-2 months ago? I'm still nauseous from that read.
From the looks of the Huffpo comments the lefties seem to be coming around to the idea of capital punishment. We really might get something done here soon. Too bad Carlin isn't around to see this shit.
Rupert Murdoch left a lot of saliva on Goldman Sucks' nuts on that one. When comes the op-ed cheerleading for President Dick Cheney 2012?
Wow smooth move lloyd. PR problem solved!!
This interview is reassuring, since it opens up the possibility of this guy being a dimwit.
Another facade on another outhouse.
http://failblog.org/2009/10/07/house-fail/
i especially loved the part of how his childhood was so hard because he grew up in Brooklyn. Cry me a fucking river Lloyd; you ain't seen shit. Brooklyn is like Beverly Hills comparing to 99% of other places in this world. Oh, and i agree with Morphizm; do you need a hankie Rupert to wipe off that cum from your cheeks ?
GS has no friends outside of its own network. Zero. Wingnuts and Libtards stand united on GS. They are doomed. The only question is: do they take all of us down with them?
GS has no friends outside of its own network. Zero. Wingnut and Libtards stand united on GS. They are doomed. The only question is: do they take all of us down with them?
Hmmm... St. Lloyd of Wall Street, dedicated to doing "good." Wow. I feel better now.
"A nation can survive its fools, and even the ambitious. But it cannot survive treason from within. An enemy at the gates is less formidable; for he is known, and he carries his banners openly. But the traitor moves among those within the gates freely, his sly whispers rustling through all the alleys, heard in the very hall of government itself. For the traitor appears no traitor. He speaks in the accents familiar to his victims, and he wears their face and their garments, and he appeals to the baseness that lies deep in hearts of men. He rots the soul of a nation. He works secretly and unknown in the night to undermine the pillars of a city. He infects the body politic so that it can no longer resist. A murderer is less to be feared."
~Cicero, 42 B.C.
excellent quote..fits the times perfectly
Ho-man just gave me a new avatar:
http://img396.imageshack.us/img396/5901/homan.png
More commentary on Vampire Squid in capitalist clothes with a touch of Rush Limbaugh here.
http://www.itulip.com/forums/showthread.php?t=12428
ad hominem doesn't work long term as you certainly know.
I'm just trying to point out the hypocricy.
We all know what is going on with the wall st, banking, fed, treasury, politico complex. they have refused to recognize the truth of our problems (overwhelming debt at all levels, fraud, etcetera) and are grossly attempting to reinflate a bubble that never worked itself out correctly.
the dollar matter and the way that the levels are being pulled is sad. too bad the average american citizen looks at the Dow number but has virtually no idea what is behind it in this current environment.
I am very sad to say it, but I simply cannot find light at the end of this tunnel.
By the way, LB, you gonna pay off sugar daddy's backstopped bonds and step up to the plate or just be the honey pot licking parasite talking out of the other end of your mouth? Pay the bonds off now or continue to be a hypocrite.
I'm also looking forward to when we (hopefully) get a genuine audit of the Fed
Genuine audit of the Fed? Won't happen without a military coup!
you very well might be correct.