Goldman Sachs

The week ended August 7 indicated that Goldman's PT on the NYSE is regaining its dominance after in the prior week it came perilously close to being overtaken by Morgan Stanley (not so much in principal as in agency trading). In the last week 800 million prgram traded shares transacted each day, 26.9% of total buy-sell volume. Unfortunately the NYSE has removed how this compares on an average basis to a 52 week trailing average which last we checked was around 25%.

"While the worst of the current US recession appears to have passed, we caution that CRE trends are just starting to soften and will remain weak into 2011; as such, REITs should underperform the broader equity markets during the next stage of the recovery (6-9 months). In fact, we anticipate a decline in FFO of more than 10% for REITs next year, on top of the 15-20% expected decline in 2009. Hence, 2011 should be the bottom with growth resuming thereafter. Over the next 12-24 months, we see the combination of rising CRE loan defaults, deteriorating fundamentals (similar to the 2001 downturn), and more stringent lending standards (50% LTV loans at higher rates) resulting in a “challenging road ahead” for REITs." - Goldman Sachs

From Goldman Sachs:

• Residential housing market continues to weaken
• Commercial real estate beginning to take center stage
• CRE equity may have further to fall or be completely wiped out
• Equity valuations driven by the consumer, with the cryptic proviso that "equity value might have downside" - no kidding
• And the best - REIT equity prices have risen... but property values continue to fall

"In response to recent media stories on High Frequency Trading, we wanted to clarify our position to clients."

The Financial Crisis was a Hoax. The global casino is open again.

No worries!  You actually believed there was a problem when Paulson and Bernanke threatened Congress last year with Martial Law; to blast the U.S. economy back to the 16th century; to crash the market unless ransom was paid requiring each American to fork over $100,000, give or take, dollars in impossible-to-payback future loans today to add to the hundreds of thousands each American already owes forever.

HAHAHA. It's all good, bro.

Great recap piece in the New York Times on whether or not Wall Street is picking the pockets of "non-club" investors (read - the guys who do not generate 80% returns with a Sharpe > 5.0 - can someone explain how risk/return works again). The consensus sure looks good for class action lawsuit lawyers.

The piece also recognizes the tremendous contribution that Zero Hedge's readership has had in this ongoing debate, once more highlighting the interactive nature of new media and how crowdsourcing is the new dominant paradigm for Media 2.0. 

Here is the link.

Additionally, should it be odd that Direct Edge, the company in the eye of the Flash hurricane with its ELP program, has the following reported ownership structure:

Yes. Direct Edge is an independent broker-dealer owned by a consortium that includes the International Securities Exchange (“ISE"), Knight Capital Group, Inc., Citadel Derivatives Group, The Goldman Sachs Group, and J.P. Morgan. Knight Capital Group was originally the sole owner of Direct Edge and the firm was spun off in the third quarter of 2007 when Citadel and Goldman made investments. With a 31.54% stake, the ISE is currently the largest shareholder of Direct Edge, followed by Knight, Citadel, and Goldman, each with 19.9%.

And here are the latest ruminations out of Max Keiser, who takes on a curious angle in his most recent Goldman Sachs attack

There has been (finally) a lot of attention to program trading, a theme Zero Hedge has been focusing on for 4 months. This week, the NYSE finally switched over to its new methodology of providing program trading, which, as Zero Hedge announced previously, involves the decommissioning of the DPTR and the delay/cancellation of implementation of "the proposed redefined program trading account type indicators (J and K)."

"We are taking your complaint regarding Goldman Sachs and its proprietary software that may be used to manipulate the markets very seriously, and have referred it to the appropriate people within the SEC."

Charlie Gasparino's recap of his behind the scenes meeting with Van Praag - apparently Goldman's most recent noble cause: "Providing liquidity" and their "proclivity for electronic trading."Odd... So odd.

Goldman principal PT shares transacted increased by over 40% from the prior week: 550 million to 765 million, clocking at near 50% of total NYSE principal volume - about par for the course.

The full scale media war against Goldman Sachs is now on and Mssrs. Canaday and Van Pragg can't hardly wait for the weekend to come already. The most recent exposure comes courtesy of Time Magazine and CBC Radio. The interesting thing here is not the publicity - everyone who is anyone knows all this stuff, and as for Joe Sixpack knowing the facts, well: absent a pitchfork billion man march on Wall Street, nothing will really come out of it. But the key thing to keep track of is whether Goldman will do a placating PR media campaign or merely stay shut in their shell. At this point the media avalanche is in full onslaught mode, and the insightful thing is whether Blankfein thinks it makes sense to preemptively approach the situation. The CEO of GS knows full well that the "full market support mode" will last only so long, and once it breaks and the floor out of the 666 S&P drops, the public will again demand blood (or Trueblood for all you vampire squid fans out there).

Jon Stewart, Paul Krugman... seems like the Mainstream Media is really catching on.

"They are literally stealing a hundred million dollars a day. Goldman Sachs is stealing every day on the floor of the exchange. They should be in the Hague, they should be taken on financial terrorism charges. They should all be thrown in jail"

Well, at least one person says what he thinks.

The anti-Goldman sentiment keeps on growing: next up is Bloomberg's interview with former Attorney General Eliot Spitzer in which he chimes in with his views of Taibbi's Goldman Sachs article and Goldman's money making prowess ("because it is a conspiracy does not mean it is wrong").
In a impressively coherent presentation, the former Governor also talks
about bankrupt states and the lack of regulation (his family life
disclosure may be fast forwarded). Must watch. (Bloomberg has made their videos almost unlinkable for some insane reason: click on the Bloomberg AV page and select the top Editors' Video Pick).

Developing story: from Goldman conference call.