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Taibbi On Goldman: Part Deux
The man who started it all, by boldly going where nobody else dared go before (with a few exceptions) and to singlehandedly rewrite the financial dictionary by introducing the concept of the bloodthirsty mollusc, by throwing out Goldman where it belongs, i.e, front and center, writes his follow-up narrative. What can we say: the man was right, to the chagrin of his numerous critics, and what's worse (or better), may have started an avalanche, which with the prodding of Senators like Ted Kaufman, could well destroy the Too Big To Fail concept once and for all. Now if only someone in the political blogosphere would do to Congress what Taibbi did to mainstream Wall Street, there actually may be hope for America yet.
Just under a year ago, when we published "The Great American Bubble Machine" [RS 1082/1083], accusing Goldman of betting against its clients at the end of the housing boom, virtually the entire smugtocracy of sneering Wall Street cognoscenti scoffed at the notion that the Street's leading investment bank could be guilty of such a thing. Attracting particular derision were the comments of one of my sources, a prominent hedge-fund chief, who said that when Goldman shorted the subprime-mortgage market at the same time it was selling subprime-backed products to its customers, the bait-and-switch maneuver constituted "the heart of securities fraud."
CNBC's house blowhard, Charlie Gasparino, laughed at the "securities fraud" line, saying, "Try proving that one." The Atlantic's online Randian cyber-shill, Megan McArdle, said Rolling Stone had "absurdly" accused Goldman of committing a crime, arguing that "Goldman's customers for CDOs are not little grannies who think a bond coupon is what you use to buy denture glue." Former Wall Street Journal reporter Heidi Moore hilariously pointed out that Goldman wasn't the only one betting against the housing market, citing the short-selling success of – you guessed it – John Paulson as evidence that Goldman shouldn't be singled out.
The truth is that what Goldman is alleged to have done in this SEC case is even worse than what all these assholes laughed at us for talking about last year.
Did we mention Matt has a way with words? And he goes on:
Prior to the "Bubble Machine" piece, I had heard rumors that Goldman had gone out and intentionally scared up toxic mortgages and swaps in order to get short of them with sucker bookies like AIG. But – and this seems funny in retrospect – I foolishly dismissed those tales as being too conspiratorial. I thought it was bad enough that Goldman was shorting the subprime market even as it was selling toxic subprime-backed securities to chumps on the open market. The notion that the bank would actually go out and create big balls of crap that would be designed to fail seemed too nuts even for my tastes.
In the year since – and this, to me, is the main lesson from the SEC case against Goldman – the public has quickly come to accept that when it comes to the once-great institutions of modern Wall Street, literally no deal that makes money is too low to be contemplated.
And our favorite punchline (Taibbi has a nasty habit of putting quite a few of them in each piece);
There is more fraud out there, and everyone knows it: front-running, manipulation of the commodities markets, trading ahead of interest-rate moves, hidden losses, Enron-esque accounting, Ponzi schemes in the precious-metals markets, you name it. We gave these people nearly a trillion bailout dollars, and no one knows what service they actually provide beyond fraud, gross self-indulgence and the occasional transparently insincere public apology.
One would almost get the impression Matt was reading Zero Hedge. That, of course, would be as ludicrous an assumption as the one that Joaquin "Jenny Craig" Almunia blasted in January, and was on the verge of beating the living shit out of the Bloomberg reporter who was interviewing him, i.e., that Greece may need a bailout: now that is truly ludicrous.
Oh and by the way, with Greek 2 year spread about to plunge tomorrow (somehow we foolishly assume that the Greek and German people, who both don't want the bailout, will actually vote for it) guess what will happen to Portuguese and Spanish ones? Has anyone at the IMF ever heard of the law of Communicating Bankrupt Vessels?
But back to Taibbi: his conclusion:
The Goldman case emerges as a symbol of all this brokenness, of a climate in which all financial actors are now supposed to expect to be burned and cheated, even by their own bankers, as a matter of course. (As part of its defense, Goldman pointed out that IKB is a "sophisticated CDO market participant" – translation: too fucking bad for them if they trusted us.) It would be nice to think that the SEC suit is aimed at this twisted worldview as much as at the actual offense. Some observers believe the case against Goldman was timed to pressure Wall Street into acquiescing to Sen. Chris Dodd's loophole-ridden financial-reform bill, which probably won't do much to prevent cases like the Abacus fiasco. Or maybe it's just pure politics – Democrats dropping the proverbial horse's head in Goldman's bed to get their fig-leaf financial-reform effort passed in time for the midterm elections.
Whatever the long-range motives, the immediate effect of the lawsuit is to put Wall Street's crazy fraud ethos on trial in the court of public opinion. For now, at the end of the first quarter, Goldman and most of the other big banks are still winning that case. But the second quarter might be a different story.
Read the full thing here. For all it's worth we will continue to ridicule and mock every upcoming worthless piece of Taibbi yellow journalism for at least the 3 or 4 subsequent weeks before he keeps on getting proven right. That's ok, we will have the rest of the blogosphere on our side, making the pain of losing our last reader all that much more bearable. We might even participate in panels to discuss this phenomenon in detail.
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Big ball of crap..ha...ha...ha
Creating big balls of crap is exactly what dung beetles do.
Sorry but I couldn't resist. :>)
A dung beetle's ball of crap is both useful and a productive result, Goldman's not so much.
it does have one thing in common, it rolls downhill
Huge similarity with Lloyd....the ball of dung that is.
That bug is thinking "Go ahead and laugh, but this is MY perfectly symmetrical ball of Dung. "
Matt and the GS sleuths on this site need to be checking on one interesting fact. Guess who else was in Blankfein's 1975 Harvard class? Guess who even spent 3 years in the same "dorm," Winthrop House?
Some guy named Ben Bernanke.
So if Blankfein is Otter to IKB's Flounder ("you effed up... you trusted us!"),
does that make Bernanke, Bluto?
Not surprised, but if you want to connect the dots you don't need to go that much further, just put the name at the beginning of the word in your search engine and type the question : .... is Jewish ? then you will find all tentacles of the vampire squid in financial world. To make things clear this doesn't mean that all Jewish people are bad, there are many wonderful Jews out there in the society who has nothing to do with these assholes but that's the only way to find everybody connected to the squid with a 100% percent accuracy.
You are an old cracked rubber douche bag. EDIT: Junkers, you are right, I could have done a much better job of denouncing this guy.
cbaba, you got junked twice already just for mentioning JEWS.
Jews. JEWS JEWS jews and more JEWS.
OK now junk me to too you ignorant fuck. The truth is what it is.
call the megaphone and add more junks,i dont care, it doesnt change the truth ignorant fuck and douche with your mother bag VI.
less than 5 minutes since i used the miracle word JEW. I already have one junk. Thank you. It feels good to be noticed.
BTW chaba. It wasnt I that junked you. Anytime i point out how the seats of power in our government is predominantly jewish i get a lot of junks. The truth is what it is.
If all those Jews wore armbands, we would see how they control our society. Perhaps thats why Hitler had them wearing armbands. And yes, truhout the course of my long life i have met, done business with and loved many Jewish people along the way. I do not hate or even dislike Jews. They are people like all others. Still, the fact remains that they hold many powerful seats.
If all those same seats were held by, say Chinese, there would be a hell of an outcry ? would there not?
yes , and your point is ..what? I speak my mind, dont hold back much.
If truth or free speech bother you, perhaps you are in the wrong place. As it stands you are free to have your say as well.
Internet tuff guys - huh? You are the minority on this site, and you take away from what the creators (and majority of posters) on this site are trying to manifest. Basically, people like you degrade this site - and this world. Ok, Leave. Just leave. btw - I responded to your reply a little farther down. I think it pretty much says it all. Take a hike now.
maybe they are the best of friends...but I would not conclude that by their shared age, school and dorm. I don't want to be judged by some of the people I shared housing with in college...shoot I lived in a house with just 12 people for two years where we shared meals, doubled-up in rooms and I don't have contact with any of those people any more, only kept in touch with one old roomate for a few years after college.
Go get 'em.
Funny. Will Felix moderate?
See, this is like Men in Black, where the National Inquirer stories about aliens are spot on.
Whats ludicrous is that the blogosphere is the real world and MSM is phoney cover up BS.
The sad part is they have not figured out that WE have figured that out and the numbers grow every day, in our favor. Who the fuck under 35 even BOTHERS with MSM. None of them, and they know it.
The TRUTH sells. Hence the spectacular ascent of ZH and others.
I understand and agree with your point that the MSM is increasingly becoming irrelevant and that the alternative media sites are exploding.
BUT (you knew that was coming, right?) as long as the predominant emotion displayed by the informed and uninformed alike is apathy, they have little to worry about. The opposite and anger is not happiness, it's apathy.
CD
as long as the predominant emotion displayed by the informed and uninformed...
Could this be because they are buried under the unrelenting and confusing bullshit they are constantly exposed to?
It is a just a matter of scope and scale.
For your consideration:
http://home.hiwaay.net/~gedesch/LavaGlass.html
Brilliant, and thanks for this post, awesome TD dude!
And when -- one hopes -- the full extent of the colossal fraud comes out in the open -- it will truly boggle the mind of the unbelieving lowbrows out there in Wonderland!
Dr. John Goldberg, on the faculty of the University of Sydney, in one of his splendid research papers, perfectly illustrated the accounting fraud surrounding those so-called "public-private partnerships."
And the exact same descriptions are EXACTLY applicable to the hedge funds scam, the private equity leveraged buyout scams, and of course, the underlying fundamental scam, the securitizations and credit derivatives.
What the good doc abstracted from his investigations: (He's referring to toll road projects in the parens.)
Paying equity dividends with virtually no cash flow available (CCT)
The introduction of large spurious amounts of debt capital of unknown origin to augment cash flow, and the drawing down of fictional amounts of capital from reserves (LCT)
and,
The use of dual entries to disguise the non-amortization of project debt (M2)
And so very applicable to the aforementioned.
On 9/10/01, the signal goes out when the Pentagon's comptroller announces $2.3 trillion can't be accounted for (i.e., missing in action). Add to that another trillion or so missing from a bunch of other government agencies, and on the twelve hours preceding 9:00 AM opn 9/11/01, approximately $3 trillion to $4 trillion is moved to offshore hedge funds for future control fraud we have been witness to, and will continue to be for quite some time to come. (Gee whiz, how very convenient those computer systems involved were destroyed by several commercial airliners flying into the two towers they were operating from.)
(Gee whiz, little did they figure that one day, when the Web reached critical mass, the cached pages of all those data communications and EFTs would be accessible!)
Blankfein = jail time
Make it so.
This cartel is multi-headed. There will be many decapitations necessary. Breaking up these banks and Hedge funds and limiting their size to 1/4 of 1 percent of the GDP would allow any to fail (obviously from their own hands) and still leave the American people whole.
Let's hone the axes and get on with this job.
Brilliant, and thanks for this post, awesome TD dude!
And when -- one hopes -- the full extent of the colossal fraud comes out in the open -- it will truly boggle the mind of the unbelieving lowbrows out there in Wonderland!
Dr. John Goldberg, on the faculty of the University of Sydney, in one of his splendid research papers, perfectly illustrated the accounting fraud surrounding those so-called "public-private partnerships."
And the exact same descriptions are EXACTLY applicable to the hedge funds scam, the private equity leveraged buyout scams, and of course, the underlying fundamental scam, the securitizations and credit derivatives.
What the good doc abstracted from his investigations: (He's referring to toll road projects in the parens.)
Paying equity dividends with virtually no cash flow available (CCT)
The introduction of large spurious amounts of debt capital of unknown origin to augment cash flow, and the drawing down of fictional amounts of capital from reserves (LCT)
and,
The use of dual entries to disguise the non-amortization of project debt (M2)
And so very applicable to the aforementioned.
On 9/10/01, the signal goes out when the Pentagon's comptroller announces $2.3 trillion can't be accounted for (i.e., missing in action). Add to that another trillion or so missing from a bunch of other government agencies, and on the twelve hours preceding 9:00 AM opn 9/11/01, approximately $3 trillion to $4 trillion is moved to offshore hedge funds for future control fraud we have been witness to, and will continue to be for quite some time to come. (Gee whiz, how very convenient those computer systems involved were destroyed by several commercial airliners flying into the two towers they were operating from.)
(Gee whiz, little did they figure that one day, when the Web reached critical mass, the cached pages of all those data communications and EFTs would be accessible!)
Blankfein = jail time
Make it so.
"On 9/10/01, the signal goes out when the Pentagon's comptroller announces $2.3 trillion can't be accounted for (i.e., missing in action). Add to that another trillion or so missing from a bunch of other government agencies, and on the twelve hours preceding 9:00 AM opn 9/11/01, approximately $3 trillion to $4 trillion is moved to offshore hedge funds for future control fraud we have been witness to, and will continue to be for quite some time to come. (Gee whiz, how very convenient those computer systems involved were destroyed by several commercial airliners flying into the two towers they were operating from.)"
Care to expand on this, with references?
"Care to expand on this, with references?"
Negative, douchey, how's about you retract your head from your posterior and do a little citizen-oriented work --- FOR A CHANGE!!!
Having expanded on it, with references, for over five years now, both to the public, or those zombie consumers who pass for the Vage Pubic (once upon a time known as John Q. Public), including congressional members and those whores-for-hire who claim to be investigative journalists (Seymour Hirsch, get a life, dood!), you can easily do the work for yourself, assuming you are not completely and totally lazy....
"Goldman's customers for CDOs are not little grannies who think a bond coupon is what you use to buy denture glue."
As part of its defense, Goldman pointed out that IKB is a "sophisticated CDO market participant"
Those sophisticated players were playing with grannies money and lost it all.
jal
Simple truth:
Paulson, Lord Blankfein's troops and others designed intentionally a product (s) that would fail. The only fact not known at the time was how badly they would fail.
If Proctor and Gamble did that, or Ford, or Manitowoc, intentionally designed a product to fail, would there even be the necessity of a damage controlling Congressional investigation?
No. They would be put out of business within months of discovery and paying out heavy compensatory costs to those harmed.
Matt Taibbi is doing for financial reporting what Hunter S. Thompson did for political reporting.
Giving it teeth.
thanks for giving credit where credit is due. (MT needs a few more years, though)
godfather of gonzo journalism† political and real casino gambling.
HST
R . I . P.
p.s. you know calvin took it again yesterday, in the fucking slop.
Except that he has clearly never actually read Ayn Rand, and won't touch the issue of fiat/central banks, the root of all our problems.
I am absolutely shocked by these revelations...
(Handing over briefcase) Your winnings, sir...
Renault: Oh. Thank you very much.
"There is more fraud out there, and everyone knows it: front-running, manipulation of the commodities markets, trading ahead of interest-rate moves, hidden losses, Enron-esque accounting, Ponzi schemes in the precious-metals markets, you name it. We gave these people nearly a trillion bailout dollars, and no one knows what service they actually provide beyond fraud, gross self-indulgence and the occasional transparently insincere public apology."
So True. Many bankers are way overpaid in comparision to their contribution to the economy and to society. Too many of our talented young people go work in Finance, when we need them in other industries that actually produce something. I think highly paid athletes and actors have a better case for their high wages, at least they provide entertainment.
http://www.youtube.com/watch?v=_Crw85HvIFs
I agree completely. And this is the real problem.
The banking industry has an effective power of taxation applied to business.
They do not add value. They just sit in the middle of the transaction and take as much as they want.
It is not just Goldie that is the vampire squid wrapped around the face of humanity - it is the entire industry. And it is our laws, regulations and regulators that gave birth to the squid and think its shit is a delicacy.
Zero Hedge & Matt Taibi: What a wonderful one-two punch to Wall Street Gangsters.
Hey Goldman and et al, Fight Club duo is here to kick your ponzinomics
all the way until your vampire squid goes away from the face of humanity.
I watched the Goldman hearings and have a few questions that I would like anybody who has a serious view on to answer. It is a character flaw of mine, but when the conventional wisdom is up, I think down. I just can’t help it. I know these questions may irritate some people, but I intend these to be serious questions, so if they are stupid please explain why and don’t just rant at me as an idiot or a dupe.
Question 1. Rating agencies’ approach to CDOs
My understanding is that a rating agency rates CDOs based on that rating agency’s ratings on the underlying assets, and that if you went to a rating agency and said, for example, you picked really good double B bonds and they should rate your CDO as if it were backed by triple B bonds and better than someone else’s CDO that also had double B bonds, they would laugh you out of the room. Doesn’t that mean that who picked the bonds was irrelevant to them and they based their CDO ratings on their ratings and the composition of the underlying assets? If that’s true, does that mean that the guy from Moody’s was wrong when he said that he would have rated the deal differently if he had known of Paulson’s involvement in Abacus. I am not saying that all double Bs are equal, just that each rating agency views each double B rated by them within a sector as equal.
Question 2. A dealer’s view on the bonds it sells.
If I go to five dealers and dealer number 5 offers to sell me the bond I want to buy at a lower price than the other dealers, but dealer 5 doesn’t “like” the bond, am I better off buying the bond at a higher price from a dealer who likes it more than dealer 5? It seems to me that I am better off buying at the lower price. If that is true, doesn’t that mean that I am usually better off buying a bond from the dealer who likes it least on the assumption that a dealer who likes it least will usually be willing to sell it a the lowest price, all other things equal?
Question 3. Physical vs Synthetic CDO
If I view two CDOs, one backed by physical assets and one backed by the same assets created synthetically, and assuming that the swaps that create the synthetic assets are sufficiently collateralized etc, is one deal necessarily better than the other? Do I care whether the dealer is selling physical assets from its balance sheet or creating them synthetically? Do I care if immediately after the deal, the dealer is net flat as a result of selling the assets or net short as a result of writing the swap? Would my view change if the dealer had hedged its physical long position, and after doing the CDO backed by physical assets, the dealer was short CDS on the assets with counterparties other than the CDO? It seems to me that I shouldn’t care, but I really don’t know.
Question 4. AAAs from BBBs
Using a life insurance analogy, if I look at a pool of 100 40 year olds and I agree to write a one year $100 life insurance policy on each of them that dies after the first 30, it seems that I should expect to have much lower payouts on the policies than if I write a one year $100 term policy on the life of each of a pool of 70 40 year olds, assuming that the lives are meaningfully less than perfectly correlated. In fact, the payout on the policies covering the last 70 of 100 40 year olds to die may be less than straight policies on 70 25 year olds depending on the relative mortality of 40 year olds and 25 year olds. Isn’t that the rationale for CDOs, and doesn’t it make sense? Of course it is dependent on accurate underlying ratings and accurate estimation of correlation. Why didn’t the people on the Goldman panel explain this?
Question 5. Stated Income Loans
The Senate panel made a big deal about stated income loans because the borrower’s statement of their income was not verified. It seems to me that the rationale for these loans was that if the value of the property securing the loan was high enough relative to the loan amount, you were as safe as with a loan that verified income but had a loan amount much closer to the value of the property. In hindsight this put a lot of pressure on property valuations and was a bad idea, but at the time didn’t many people support these loans in a belief that they lowered transaction costs, sped up the loan process and, most importantly, made loans available to people who might not qualify under traditional standards?
Do you work for Goldman? I am familiar enough with two of your premises to call the rest of it bullshit. Also, please don't use the Socratic Method here. We dislike it.
didn’t many people support these loans in a belief that they lowered transaction costs, sped up the loan process and, most importantly, made loans available to people who might not qualify under traditional standards?
Who are 'many people'? The only people this benefited was the mortgage salesman who received bonuses based on overall shittyness of the mortgage. More shitty = bigger bonus.
In hindsight this put a lot of pressure on property valuations and was a bad idea
Name one transaction where the bank decided that an offer for a property was too high during the 'boom/bubble'.
Name one transaction where the bank decided that an offer for a property was too high during the 'boom/bubble'
Ahh, I'll have to get back with you on that.
And for every example, I'll show you 100 where they leaned on the appraiser to hit an elevated valuation.
Reply to Reflexive_Contrarian:
Your questions are only as good as their assumptions. The agenda of your assumptions is apparent.
Question 1- The erroneous assumptions in this question:
Rating firms operate in good faith.
Rating firms view different securities with the same rating as equal.(google "global mapping Moody's")
ACA's work was viewed as immaterial.
CDO ratings are based on the underlying asset ratings. (a portfolio's aggregate cash flow probabilities is entirely seperate from the sum of the cash flow probabilities of its parts. Consider lack of diversification for example.)
Question 2- The erroneous assumptions in this question:
The bond was not extremely complex.
None of the dealers created the security.
All the dealers and you had access to equal information about the bond.
This bond was not a proprietary new issue only offered by one dealer.
Question 3- The erroneous assumptions in this question:
It does not matter if you are participating in the capital formation process or just gambling.
You think you could ever know as much about the assets as the dealer-especially when the assets are managed dynamically.
Question 4- The erroneous assumption in this question:
That if the miniscule flimsy protection tranches in subprime CDOs were talked about it would not hurt your case.
Question 5- The erroneous assumption in this question:
Just because something originally had a good intention that its later abuse is justified.
Your erroneous assumptions
1. Ratings agencies are not responsible for their own ratings.
2. Investors are not responsible for their own investments
3. Regulators should not be responsible for governing synthetic financial instruments.
4/5 Not important to cover once the first 3 are covered.
Thanks for your reply. I am retired and watched in terror two years ago as my savings appeared to vanish. I owned total market equity index funds and investment grade bond funds. Luckily, I was too paralyzed to do anything, and I did not sell. Now things have recovered almost to where they were. I feel like I have had a near death experience, and for the past year I have been trying to understand what happened so I can avoid a repeat. I’ve read Sorkin, Sowell, Taibbi, Cohen, and McClean and others. I’ve watched the hearings. I follow the news. I still don’t have a clear understanding of the causes of the crisis. I am not asking for advice. I am looking for facts so I can form my own conclusions.
I don’t buy evil Wall Street as the cause, because as far as I can tell, the more involved a bank was in the mortgage market, the more they got hurt. It doesn’t seem that they had any better information than anybody else. Look at Citibank, Merrill, Bear, Lehman, UBS etc. Even Morgan Stanley got killed when they tried to hedge by shorting subordinated bonds and buying super senior bonds to help pay the cost of the hedge.
I don’t buy CDOs as the cause because as far as I can tell, CDOs based on bank loans and corporate debt have performed relatively well, and only CDOs based on mortgages have been killed.
It all seems to come back to the ratings agencies making a huge mistake on their mortgage ratings and their estimation of how correlated mortgage securities were, and the market accepting their judgments without question. If, for example, you read the UBS Board of Directors report on their losses, it is clear that they were relying on the ratings of the super senior bonds they owned in estimating their VAR as almost nothing.
So I am trying to answer the question of why the ratings agencies got mortgages so wrong and why investors didn’t question them. I thought that maybe the relative availability of corporate credit data from SEC filings compared to data needed by a non ratings agency analyst to evaluate a mortgage deal might be an explanation. If Moodys made a mistake on a corporate rating, they would hear about it from outside credit analysts. Not so on mortgages. But, if this were true, those people – Wall Street – who had at least some access to the information would have done better than average, but they did worse.
This almost seems like a situation where a car runs out of gas because both the husband and the wife think the other filled it up. Somebody in the mortgage market assumed that somebody else was doing something that in fact was not getting done. I am trying to figure out what that was.
Cut the "homo" crap. I would bet the same "ass kicking" applies to your high school past as well.
That Taibbi's a rich brat is no secret - he's said so umpteen times. But your deficient need to refer to his "undeclared" sexuality says alot more about you than Taibbi. I'm a "homo" who would have "kicked your ass" all the way back to your uni-brained bigot land in "high school".
Revenge of the "homos" at it's best here.
For you it's not "onward" it's full speed Backwards!
Shutup fag.
Zero Power = lost credibility. Anyone (and there are many) who feels compelled to use words like jew, fag, nigger, beaner, chink, etc., to get a point across should just vacate this site. You all waste space. Have a nice day.
village Idiot, i had no idea the word "jew" was a bad word. I thought it was a descriptive label of a religion and the people in it.
Nigger, beaner , chink etc i know to be derogatory labels.
Blacks , mexican or chinese are ok to use?
Forgive me, i am blonde, german and part redneck.
BTW you are a racist in your own way as evidenced by your comments.
You know what I mean - you want to cover it over, go ahead.
An honest , truthful interchange is welcomed by me. I dont think theres a need to be nasty about it. I believe in reciprocation and being forth right. Theres alot of covering over going on, but not by me.
You expose and embarrass yourself all at once. I don't think I need to add anything. Out.
Oooo, when I grow up, I want an ego just like yours.
Matt Taibbi Taibblog
I was raised by a single mother.
Hey QT
If you're looking for an ass kicking, don't forget to bring that big brain of yours to the fight.
I loved knocking the porcelain teeth out of A-holes like you. Now take your Daddy's Merc and go home.
MT is doing a public service, you still have dog crap on your shoes.
I'm betting you have a "nerd" on staff that does your Gaussian copuli for you because you barely made it through the "math is hard" MBA-only calc class at your university.
Did he forget to mention the part about it requiring a normal distribution to be valid?
Now go squat in your condo before I key that leased piece of German shit and get you in trouble with the dealership.
Im assuming you knew your post was going to be the least popular one on this thread..
surprisingly, not all assholes have insight
Just think about what you can do. If you can talk to and wake up one person every six months, that changes the world. One person every six months is not that much effort so it is doable. That progression of people turning away from Faux and the NFL and caring about themselves and what they know. Those are the core that the vampire needs to keep going, because outside of the activated core the minds there are already numbed.
I think we are close to that point now. Maybe that's why these folks seem like they are little children with poo in their shorts. Why else would Goldman leave Blankfein to shoot his mouth off. Either they are way clever or way toasted.
There is no need to get "out in the streets" that is a day of wasted effort because they aren't listening and your protest won't be broadcast. But if you chat with more people and bring a bit of info here and there your intention changes the energy. Just a smile and a "Hey how about that $7.3B on Friday night, eh?" over the water cooler rather than "Hey did you see the game on Saturday?" Nice difference? Very different energy?
1) Buy gold and take delivery
2) Buy silver and take delivery
3) Tell people it's all a Ponzi, provide proof, advise them to buy gold & silver and take delivery.
LeBalance you are correct. I have an e-mail group of friends that about once a week I sent something of interest from Zero Hedge. I select pieces that are not too out there, something thay CNBCer's can relate to. Usually I get no response. In person, they call me Dr. Doom. But at least they are hearing the other side as compared to believing CNBC.
George, you are right on the mark. No one wanted to pay attention to the warning signs I emailed to friends before the bubble burst.
Then the market took that dive and they were asking me for my advice to jump ship ot hang in the market (now that most had lost 1/2 their retirement funds). I told them to hang in there it was too late to cash out.
Now, I send them the same warnings, and again they pay no head...if they respond at all ( most don't). And, when they did respond it was about their tomato plants or a recommendation that I should take some time off and chill. I don't send out anything anymore. I felt like I was dealing with the guy in the old brokerage commercial where he stands there while his friends talk stocks, and the bubble comes out of his head with a cow chewing it's cud. Folks just don't want to be involved until their electricity or the cable goes off.
And...the sad part is the Wall Street thungs knew this long ago.
These flighty Tourre e-mails boasting of cashing in on a disaster and chuckling over the "surreal" experience of power-lying right in the face of a business partner are Goldman's very own Ben Roethlisberger drunken dick-waving moment.
Priceless!
President Obama during his Michigan graduation speech yesterday said the criticism of government “conveniently ignores the fact in our democracy, government is us.” And, of course, the problem we’re dealing with here is that in asking the government to break up the big banks such as Goldman, many would say the problem is that the government is not us, it is the big banks. (See George Washington’s two excellent contributor articles on “Break Up the Giant Banks.”)
Teddy Roosevelt finally decided he needed to move against the growing monopolies that threatened competition and fair markets. “The great corporations which we have grown to speak of rather loosely as trusts,” he said, “are the creatures of the state, and the state not only has the right to control them, but it is in duty bound to control them whenever need of such control is shown…
“The immediate necessity in dealing with trusts is to place them under the real, not the nominal, control of some sovereign to which, as its creatures, the trust shall show allegiance and in whose courts the sovereign’s orders may be enforced. In my opinion, the sovereign must be the national government.” – Teddy Roosevelt
The problems we face at the moment with having “government” move to break up the big banks such as Goldman is that unlike the Teddy Roosevelt years, the president and the national government now represent the banks more than they do the people. In order for Roosevelt’s solution to work now, the people must become this “sovereign” again and actually become the power of the government again, taking this power back from the banks.
trusts
what a concept, JR.
Interesting, aren’t they, these weasel words? “Trusts” is just one in a long line of usury creations, such as “securities”—hold these banknotes, bonds, common stocks and derivatives and, voila, you’ve got security! To counteract the connotation of monopoly, lawyers thought of “trusts”—hopefully bringing to the public’s mind benevolent foundations, doing God’s work for the country, selflessly advancing honest progress while sharing and making life better for all… Breaking up these "benevolent" price-fixing monopolies that kill competition is "antitrust” or "trust busting."
It reminds me of this definition from the Doublespeak Dictionary:
Calculated risk--“We have every confidence that our plan will work, but just in case it fails remember that we warned against it.”
And this one from a Letter to the Editor:
Social Security – “Benefits aren’t secure and clerks who dispense them aren’t sociable.”
A few more weasel words… in advertising: virtually spotless; acts on the cough control center; as much as 50% more staying power; can be effective in combating tooth decay; fortified with minerals (like the earth we walk on); look of luxury; Coke is the real thing….
How, JR, How ?
A primary difference between our time and Teddy’s time is the unbelievable connections available through the Internet, while at the same time economic hardship and corruption are inducing people to action. The people can be informed through an increasing flow of names, dates, transactions, law bendings, and incestuous relationships between government officials and big bank officials, most once blocked by the corporate-owned media.
The pretend actions being taken by politicians now are nothing compared to a future angry populace armed with the facts. Could a magazine reporter such as Matt Taibbi have impacted the nation as he has without the Internet! I think this knowledge in the hands of an increasingly angered and informed public is knocking at the door of the shadow government.
IMO, you and I are now participating in one of the strongest weapons in this arsenal, Zero Hedge, and your words are some of the most lethal missiles fired at the target—all bull’s eyes.
And once the people put America back on track, the shadow government’s stranglehold on the rest of the world will be broken.
That TR...what a socialist.
Let me take you back to 1998. Goldman sold toxic Russian bonds which it shorted. LTCM blew up. Goldman used it's Washington Rolodex to get made whole on the taxpayer's dime. It was no accident. The Russian bonds in question were designed to fail. Goldman paid former President GHW Bush to fly to Russia and help lend credibility to the faltering Russian credit markets. They issued bonds, collected fees then arranged a huge swap for dollar bonds which got sold to hedge funds like LTCM. They acknowledged later they were short just as the bonds defaulted and the Rubble was devalued, triggering a massive liquidity crunch. In the aftermath, Goldman and Buffet scored a Fed mediated deal where they purchased LTCM assets at firesale prices.
Sound familiar? It should. Same basic concept as in the AIG Davis Square deals. And the Abacus deals with ABN Amro and IKB. I think the Abacus deal confirms that Goldman is willing to take side bets and under the table cash to let others in on the kill like John Paulson.
I've said it before: AIG didn't slip, they were pushed. If Wall Street says it's bullish on America it may have a big short bet going.
1998.....Was that under tha Hankster by any chance?
That was Bill Clinton, Robert Rubin and Allen Greenspan on that deal
Powerful synopsis. +100. One for the files...
So, just how does the sleeping America wake up? How do you get justice and fair play when the politians, lawyers, and on and on are a part of the protection of such practices?
How do you wake up 'an investor' who thinks Warren Buffet is the best thing since sliced bread?
How do you get Americans to withdraw their money from one bank and put it into another bank and then find out that that bank is just as bad?
How do you get Americans to get anrgy about this robbery of their futures when they are 'in your face' in a heart beat over religion, immigration, drugs, birth control, women's rights, gay rights, tourcher, war, violent video games and on and on.
No, I am practical, now, in my old age. I see what Americans are and have become. I see that loosing Korea, Vietman, Iraq, and a host of other 'wars' along the way has done nothing to change us. I see the same old predjudices, the same old narrow mindedness that goes back to the middle ages...still being 'fought' over. I see indifference to the destruction of the very world we live in given token attention in party conversations.
Not for one moment do I have any blindfaith that anything will change. We are still in high school.
At least being on the right side of this bullshit is not being ignored anymore. I was beginning to think it was like the car alarm going off in the parking lot that everyone including police ignore while Hitler Blankfein sends the masses on on those Auschwitz trains to bankruptcy.
Most over 35 as well.
Sorry, that was meant as a reply to Cindy.
I'm glad to hear that Taibi put a short blurb about the banks scamming in the gold and silver market. I hope he does some investigation into this as well.
Bravo MT. Keep the pressure on.
I'm sure I'll be accused of being a shill for GS, but after reading Taibbi's accusations, doesn't one pause to wonder where the facts and evidence are in his bill of indictment?
I'm sorry, but "everyone knows it" leaves me rather underwhelmed.
I could care less about GS, but we don't convict by popular acclaim--no matter how distasteful they are.
Dear Mr. Forbes:
It looks like shit, it smells like shit, it came out of an anus, but no, I don't think MT needs to give it a taste test.
The "facts and evidence" collection are going to require a pair of water pump pliers and a blow torch. Goldy wouldn't admit the truth, if the shit cradled their nose(s). Only when the criminal indictments happen, will Fabby roll over. And not until then. And don't be surprised if Fabby accidentally drowns in his bathtub.
By your standards, Hitler would get a pass, because there was no direct evidence that he had his fingers on anything.
P.S. Thanks JR
"...but we don't convict by popular acclaim--no matter how distasteful they are."
In the Star Chamber of ZH we do - don't you know the regular justice system is broken or this shit with GS wouldn't be going on? They'd be long out of business, back in October 2008. And good riddance. Distasteful? They are parasitic vermin.
Actually, Goldman told us themselves sometime last year ( believe I actually read it here at ZH) when they issed a letter to their clients saying that their prop trading desk could, on occasion, take positions contrary to Goldman's recommendations. In other words, their smartest guys (you don't get to be a prop trader at a place like GS unless you're very good at what you do), with the best computer systems and information flow, and access to near instaneous execution are competing with the schmuck in Peoria who has an internet acccout, and watches CNBC. Who do you think is going to win that contest?
And didn't TD post a few articles earlier in the year that showed a tremendous proportion of the trades on any given day were from GS's prop desk? So it's not a case of their prop traders getting an analyst's report a day earlier than the public; it's a case of making the most money you can, and GS's prop desk profits are enormous.
It's a classic "agency" problem. In theory, GS would give their clients their best advice, so as to keep the clients loyal, but in practice, they are making so much money on prop trades - and the prop traders usually don't handle "retail" accounts - that concern for the clients has gone out the window.
As for front-running - you must be new here. The SEC even admitted that it gave some select firms to right to see orders a few seconds before execution. The edge that gives these guys is tremendous. They can scalp a few cents of price action over and over. May not sound like much, but if you're trading a billion shares a day, it adds up pretty quickly.
When I read the Goldman letter outlining their position, I decided I would never do business with them. These guys are actively betting against their own clients. I'd never give them a cent. Taibbi's and TD's work just confirmed that decision.
front-running, manipulation of the commodities markets, trading ahead of interest-rate moves, hidden losses, Enron-esque accounting, Ponzi schemes in the precious-metals markets, you name it.
I like Taibbi because he has a way of unraveling the complexities of spin, while simplifing the nonsense in words that are clear and direct. Much like William Black, and Harry Markopolos.
These guys, and others like them will take that "Dung Beatles" ball of crap and set it ablaze.
F*** G-Sac.
I can't wait for MT and SP to get back in their Katrina Kanoe and rescue some fish, ducks, birds, and shit. This time make sure your camera crew be union or I be gettin fugly on your a$$.
HIPO-CRITES TODAY (Inaugural Issue):
http://williambanzai7.blogspot.com/2010/05/hipo-crites-today-inaugural-i...
do you even have time to sleep at night. perhaps not. i am sure you are at peace, but containment?
This is what happens when you live on NY Time in Hong Kong.
(A) any act or threat involving murder, kidnaping, gambling, arson, robbery, bribery, extortion, dealing in obscene matter, or dealing in narcotic or other dangerous drugs, which is chargeable under State law and punishable by imprisonment for more than one year; any act which is indictable under the following [sections] of 18, U.S.C.: 201 (bribery), 224 (sports bribery), 471, 472, and 473 (counterfeiting), 659 (theft from interstate shipment) if act indictable under 659 is felonious, 664 (embezzlement from pension/welfare funds), 891-894 (extortionate credit transactions), 1029 (fraud with access devices), 1084 (transmission of gambling info), 1341 (mail fraud), 1343 (wire fraud), 1344 (financial institution fraud), 1461-1465 (obscene matter), 1503 (obstruction of justice), 1510 (obstruction of criminal investigations), 1511 (obstruction of State or local law enforcement), 1512 (tampering with a witness, victim, or informant), 1513 (retaliating against a witness, victim, or informant), 1951 (interference w/commerce, robbery, or extortion), 1952 (racketeering), 1953 (transport of wagering paraphernalia), 1954 (unlawful welfare payments), 1955 (illegal gambling businesses), 1956 (laundering of monetary instruments), 1957 (monetary transactions derived from specified unlawful activity), 1958 (use of interstate commerce facilities in murder-for-hire), 2251-2252 (sexual exploitation of children), 2312 and 2313 (interstate transport of stolen motor vehicles), 2314 and 2315 (interstate transport of stolen property), 2321 (traffic in motor vehicles or parts), 2341-2346 (traffic in contraband cigarettes), 2421-24 (white slave traffic); any act indictable under 29 U.S.C. 186 (payments/loans to labor orgs) or 501(c) (embezzlement from union funds); fraud connected with a case under title 11, fraud in sale of securities, or felonious dealing in narcotic/other dangerous drugs; or any act indictable under Currency and Foreign Transactions Reporting Act. 18 USC
http://www.lectlaw.com/def2/q008.htm
So we got:
664 (embezzlement from pension/welfare funds),
891-894 (extortionate credit transactions)
1344 (financial institution fraud), 1952 (racketeering),
1956 (laundering of monetary instruments)
Entire financial industry was/is running on this shit.
Then add bundles of incestuous CDS interaction = "TBTF"
@fightthepower
Andrew Maguire interview...Tries to communicate reality in the Silver market.
http://www.kingworldnews.com/kingworldnews/Broadcast/Entries/2010/3/30_A...
THE KITCHEN SINK:
http://williambanzai7.blogspot.com/2010/05/kitchen-sink.html
Taibbi actually did do it for Congress - - and wrote a book about how little they do
Well I guess it's settled then.
Let's take Goldman's management out to the woodshed then replace them with the IMF/BIS/FSB gnomes working out of Basel. Thanks Mr. Simon ("I really am an American!") Johnson and Mr. Paul ("single global currency") Volcker for "saving" us.
AND NOW FOR A BRIEF MESSAGE FROM GOLDMAN SQUID:
http://williambanzai7.blogspot.com/2010/05/up-yours-america.html
Why isn't anyone asking the more relevant question? ...Was the speculative bubble in oil prices manufactured to push subprime over the cliff? And if so, were the same guys who were running oil to $140 with one hand shorting the housing market with the other?
Would have certainly been a neat trick to pull off, but I do recall GS flogging the peak oil story quite hard at the time.