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315 Comments
- GueroGuapo18, on 07/03/2009, -8/+116Another great piece from Matt Taibbi. Make the big thief king.
- JanSimpson, on 07/03/2009, -5/+94Awww - How much money does Goldman Sachs spend on Lobbying? How many accounts does Goldman Sachs have of Congressional Members? How many favors does Goldman Sachs do for Chris Dodd, Barney Frank, Nancy Pelosi, OBama, Geithner? lots of questions never asked and never answered
- devans00, on 07/03/2009, -23/+99Another educational and eye opening article.
I like how he explains how most of the shenanigans were well beyond a regular person could reasonable know and do to defend themselves. All those Teabagging jerks who want to put the financial collapse on their neighbors down the street with foreclosed houses can just bite it.
Companies like Goldman Sachs counted on the ignorance of the masses and made money off of them. After all, if people who made their living in the financial industry couldn't keep up with the highly complex nature of investments, how could Josette Blow? - inactive, on 07/03/2009, -15/+70How many Obama fans won't read the article and realize the last 2 pages are about how Goldman was his #1 campaign contributor, and how the new carbon credits market he is helping create is the next bubble?
- Altanar, on 07/03/2009, -8/+52Wrong. Students, professors, and faculty from the University of California was his #1 largest contributor from a group. http://www.opensecrets.org/pres08/contrib.php?cycl ... Top 5 contributor sources for Barack Obama: #1 University of California, #2 Goldman Sachs, #3 Microsoft, #4 Harvard University, #5 Google
If you REALLY want someone who takes the advice of bankers at heart, you always have John McCain. Top 5 contributor sources for John McCain: #1 Merrill Lynch, #2 Citigroup, #3 Morgan Stanley, #4 Goldman Sachs, and #5 JPMorgan Chase. http://www.opensecrets.org/pres08/contrib.php?cycl ...
How many of John McCain's contributor's got bailout funds from his Yes vote on the TARP bill? All of the top 5, you say? - loopbiz, on 07/03/2009, -23/+62SQLserver - The free market was not working unchecked. Legislators make laws. Who do you think made it possible for the housing bubble to happen, forcing banks to offer loans to people who could get in over their heads and allowing the banks to lift the leverage on their reserves. It was the legislators and in case you didn't notice, and Democrats were in charge. This is not to say that no blame is attached to the banks, but this system is capitalism and immediate profits is the aim of the game, with no thought for the future. That is where part of the problem lays.
- judicar, on 07/03/2009, -7/+44Finally we found someone to blame this mess on! Now we can all go back to spending other people's money.
- SamSks, on 07/03/2009, -3/+39Yes and no. There were many reasons that caused the real estate bubble. The Community Reinvestment Act was put into place in 1977 - way before the bubble - although, it was continually modified and expanded until 2008. Yes, I agree it did add to the problem but it was no where near THE cause or even the major cause.
The MAIN cause was that the banks who wrote the loans were able to pass them along to someone else which means that they didn't have to bare the risk of those loans and yet, they were able to pocket all the fees and commissions that were earned from writing those loans. Risk was removed from return.
Which means they didn't care who they lent to because they didn't have to worry about being paid. The loan officer made his commission. The bank sold the mortgage to Wall Street and they sold it to suckers who believed the BS from the ratings agencies.
I hate to admit this, but the liberals are more accurate when they say it was "Wall Street greed."
The Economist magazine had a great list of the causes several months back - I can't find it.
BTW, it would have been easier to find the context of your comment if you used the Reply link to SQLServer's comment. - sv650touring, on 07/03/2009, -2/+33in America, public protests are now considered a mild for of terrorism
- spriggig, on 07/03/2009, -7/+38It doesn't matter who we elect.
- RonPauls, on 07/03/2009, -12/+42Taibbi implies that people should not be able to voluntarily transaction with others (like buying oil futures, stock buyback, mortgages). That's ridiculous. That means that he wants force to be used against an individual who is not using force against another person or property.
For the private bank behind the downturns, look to the Fed. They can legally counterfeit and prop up companies such as Goldman Sachs. - Tehrab, on 07/03/2009, -1/+28Did you even read the article?
- keythb, on 07/03/2009, -3/+29I feel this article was great -
It is a little dark and I don't believe that there were any secret meetings or conspiracy at GS - the main goal of any corp is to draw value to it's shareholders no secret there
What i feel the article does well is connect allot of dots for people outside of high finance
It also highlights that people at GS and allot of hedge funds understand money, economics, and value, WAY better than regulators in the government - They use this knowledge to exploit the market instead of having any sense of social responisbiliy - this is greed pure and simple - this is what we should work to change :) - Pinkertinkle, on 07/03/2009, -10/+35Let's hang everyone associated with GS.
- bu4ik, on 07/03/2009, -12/+36Despite what RollingStone's economic experts say (laugh), I'm sticking with placing blame on the Federal Reserve.
- AmnesiacJack, on 07/03/2009, -2/+23I worry for the future as I see no way out of this. Even though people are starting to see the problems and follow them back to the source, will it be enough and will it be quick enough?
- BlacklabelSAR, on 07/04/2009, -1/+21http://en.wikipedia.org/wiki/Goldman_Sachs
"Former Goldman Sachs employees such as Henry Paulson and Robert Rubin have held high positions in the federal government, regardless of which party was in the White House."
http://en.wikipedia.org/wiki/Henry_Paulson
"Henry Merritt "Hank" Paulson Jr. (born March 28, 1946) served as the 74th United States Treasury Secretary and is a member of the International Monetary Fund Board of Governors. He previously served as the Chairman and Chief Executive Officer of Goldman Sachs. In 2008, Time magazine named Paulson as a runner-up for its Person of the Year 2008, saying, with reference to the Global Financial Crisis of 2008: "if there is a face to this financial debacle, it is now his"."
"Notable statements
In Spring 2007, Secretary Paulson told an audience at the Shanghai Futures Exchange that "An open, competitive, and liberalized financial market can effectively allocate scarce resources in a manner that promotes stability and prosperity far better than governmental intervention."[18]
In August 2007, Secretary Paulson explained that U.S. subprime mortgage fallout remained largely contained due to the strongest global economy in decades.[19]
On July 20, 2008, after the failure of Indymac Bank, Paulson reassured the public by saying, “it's a safe banking system, a sound banking system. Our regulators are on top of it. This is a very manageable situation.”[20] - PeppermintPig, on 07/03/2009, -3/+21Working? Corporatism is a form of intervention, which undermines open and voluntary exchange.
What's ironic is that you overgeneralize your condemnation of market activity while ignoring the political mechanisms.
Here's a hint for you: Politicians and corporations are often in collusion: Until it's politically or economically expedient to do otherwise, this relationship of graft will continue. - Breyker4711, on 07/03/2009, -1/+18This is a very interesting piece, I just wish some more evidence had been presented besides a bunch of people who work in the financial industry, or in regulation of said industry also worked for GS at one point in time....
GS is a massive entity, of course it will have lots of former employees populating the financial sector.
It is the equivalent of saying there is an SNL conspiracy to populate comedic films. - DonAlfred, on 07/03/2009, -3/+20But you obviously don't do anything about it. That's why America is great too, isn't it?
- Mothrog, on 07/03/2009, -11/+28"All those Teabagging jerks who want to put the financial collapse on their neighbors down the street with foreclosed houses can just bite it."
So, someone who makes $50,000 who decided they needed a $400,000 home bears no responsibility? - voisine, on 07/03/2009, -0/+16Well, not quite. Goldman Sachs is the biggest investment bank, and as such, has the closest ties with the fed. When the fed inflates by setting artificially low interest rates, Goldman Sachs is the largest benificiary of the new credit. The problem is caused by the fed, and Goldman Sachs is simply taking advantage of the resources made available to maximize profit like any other business. Of course there is also corruption involved where Goldman Sachs employees and executives influence and even run the fed, but again, that's a problem with the fed system.
- emmeron, on 07/04/2009, -0/+16Let's not downplay how well GS is aided by the Fed. The Fed is in power to let companies like GS ruin all for their profit.
- Breyker4711, on 07/03/2009, -1/+16Maybe that means we need more than two major choices.... I like Obama personally, but hot damn do we need a third, fourth, and fifth party.
- DonAlfred, on 07/03/2009, -1/+16That's how we do business. That's how we take your money.
- funk49, on 07/03/2009, -0/+13There's absolutely NOTHING we can do about it. Our representatives do not "represent" their constituents. And before someone says, "vote them out", I"ll remind you of one thing...if voting made a difference, it would be made illegal.
Check out the meandering that has taken place with the California districts. We've had elections in recent history where not ONE seat changed parties throughout the state....not one. - BlacklabelSAR, on 07/03/2009, -0/+12Yeah, and that guy who stood in front of the tanks in Teinaman Square shows that China is great for allowing him to do that......oh, wait
- samk, on 07/03/2009, -2/+14Some people read Rolling Stone for economic analysis. Some people read the Economist:
http://www.economist.com/specialreports/specialrep ...
- thecoolestguy, on 07/03/2009, -15/+27The idiocy of attacking a grassroots movement against wealth redistribution and massive bailouts is too much.
The teaparty was an important protest against a MASSIVE federal government that is spending far far more than it can afford, and on programs that it is not Constitutionally authorized to be taking on.
By attacking it, you are enabling the power elite to continue their expansion of federal power unopposed.
BTW, Obama represents Goldman Sachs et al:
http://www.takimag.com/site/article/establishment_ ...
--Establishment Messiah
by Justin Raimondo on October 09, 2008
Now, let me just close by saying this. I do not think this is going to be easy. It’s not going to come without costs. We are all going to need to sacrifice. We’re all going to need to pull our weight, because now, more than ever, we are all in this together. Now, that’s part of what this crisis has taught us, that, in the end of the day, there’s no real separation between Wall Street and Main Street. There’s only the road we’re traveling on as Americans. And we will rise or fall on that journey as one nation and as one people.
~Barack Obama
Thus the junior senator from Illinois rationalizes his support of the bailout. And if you read the whole speech, you’ll find that it is highly unusual, especially for a Democratic politician. There is none of the class warfare rhetoric, none of the Palinesque denunciations of “greed” and “predatory” lenders, which made the perky GOP vice presidential nominee sound, at times during the VP debate, like a combination of William Jennings Bryan and Father Coughlin. Oh no, that’s not Obama’s style at all, and especially when it comes to the bailout issue, because, you see, his entire mission is to convince the American people that there truly is “no separation between Main Street and Wall Street”—because, after all, he is Lehman Brothers’ bridge between the two. As the OpenSecrets.org web site points out, Lehman Bros. was generous with its contributions to members of Congress, especially Democrats:
In the current Congress, 271 lawmakers have collected nearly $3 million since 1989, with 72 percent going to Democrats. Democratic presidential candidates and senators Hillary Clinton and Barack Obama top the list of all-time recipients for the company, collecting $410,000 and $395,600 respectively. Sen. Charles Schumer, D-N.Y., a member of both the Senate Banking, Housing and Urban Affairs Committee and the Senate Finance Committee, hauled in $181,450, while Sen. Chris Dodd, chair of the Senate banking committee, has collected $165,800.
That’s just the tip of the iceberg. If we look at the list of contributors to Obama’s presidential campaign, we can see that he is, for all intents and purposes, a wholly-owned subsidiary of Lehman Bros., not to mention J.P. Morgan, Citibank, real-estate holding companies, and a veritable Who’s Who of the sub-prime mortgage lenders who are now being bailed out at a cost to the taxpayers—so far—of $700 billion.
Obama’s campaign would have us believe that he’s the anti-corporate candidate, a populist “man of the people” whose race for the White House is being funded by tens and twenties sent in by ordinary folks who can’t wait to see him crack down on Wall Street abuses. What they don’t want you to know is that, out of the two and a half million donors to the Obama campaign, around 180,000 top dogs account for almost 60% of his campaign treasury. Who are these people? Let’s take a closer look….
First off, you have to understand some basics, beginning with the basic irrelevance of those old-time bugaboos known as “political action committees.” These organizations, which represent groups openly seeking favors from the government, are far too transparent and old-fashioned for the Obama campaign, which brags that it doesn’t take PAC money. It more than makes up for this, however, by employing hundreds of “bundlers,” fundraisers who get around limitations on campaign contributions given by individuals by “bundling” donations from a given interest group, including corporate entities.
Of Obama’s 180,000 top dogs, nearly 600 are bundlers representing mostly Wall Street firms, and the sub-prime crowd features prominently. Obama’s bundlers raised over $18 million. You get a better picture of Obama’s supposedly “grassroots” campaign financing when you realize that a mere 552 donors account for almost a full third of his campaign cash. This is masked, albeit not all that effectively, by either failing to list the occupations of these bundlers, or else giving them some innocuous description like “retired” or “homemaker.”
So while it’s true that, among Obama’s campaign contributors there are many Lehman Brothers Executives, such as CEO Richard Fuld ($2,300), President Joseph Gregory ($4,600) and dozens of other top execs, amounting to over $395,000, this is just chickenfeed. The candidate’s bundlers among the firm’s top echelon have raised the big bucks for their messiah. Get a gander at this list of Lehman luminaries:
• Christine Forester - ($500,000-plus) senior executive.
• Mark Gilbert - ($500,000-plus) senior executive.
• John Rhea - ($500,000-plus) managing co-director of Lehman Bros. Global Investment Banking.
• Theodore Janulis – Bundler (over $100,000) & Lehman Brothers, managing director of Global Mortgages.
• Nadja Fidelia – Bundler (over $50,000) managing director.
Obama is going around the country, trying to maintain his populist image, and descrying the greed and corruption of Wall Street whilst crying crocodile tears for the little old ladies being thrown out on the street by sinister banksters. He’s particularly hot under the collar about some of those golden parachutes, whereby the financial wizards behind the sub-prime disaster managed to get away with multi-million-dollar pay-outs. Yet some of the biggest figures in the sub-prime mortgage market have been some of his biggest fans, if monetary contributions are any measure.
Take one Stanley O’Neal, who received more than $161 million when he was fired as Chairman of Merrill Lynch, one of the biggest of the sub-prime lenders. He donated to Obama’s 2003 Senate campaign, and subsequently gave the maximum to his presidential bid. Indeed, the O’Neal family (husband and wife Nancy) are such big Obama fans that they initially tried to give over the maximum—$6.900—and had $2,300 refunded to them.
Another high-roller in the sub-prime sweepstakes is Steve Boland, a managing director of Countrywide, which made a specialty out of selling loans to people who clearly couldn’t afford them: he maxed out to the Obama campaign last June. Andrew Beer, president of Wachovia’s Evergreen Investment Partners, also gave the maximum. The other big players in the sub-prime sandbox all turn out to be Obama-maniacs, including a good number of Citigroup execs.
The Center For Responsive Politics informs us that of the top 20 sources of campaign cash for Obama, 11 were from either investment banks or law firms closely tied to these financial institutions, and the list of big corporate donors – especially the bundlers – is truly awe-inspiring. They include: John W. Roberts, of Ariel Capital Management (over $500,000), Jim Torrey, Founder of the Torrey Hedge Funds over $500,000), Charles Lewis,Vice Chairman of Merrill Lynch, Richard Leweke, Vice Chairman of Washington Mutual Card Services, Seth Waugh, CEO of Deutsche Bank. Over $200,000: Louis Susman, of Citi Investment Banking, J. Michael Schell, managing director at Citigroup, David Heller and Bruce Heyman, both managing directors at Goldman Sachs, Michael Froman, managing director at Citigroup. Francisco Borges, chairman of Landmark Partners a private equity real estate firm, bundled $50,000 for Obama, as did Todd Williams, a managing director at Goldman Sachs and the Real Estate Council.
Obama’s backers in the world of high finance—platoons of top execs from Lehman Brothers, Wachovia, Washington Mutual, Citigroup, Deutsche Bank, Merrill Lynch, Goldman Sachs, Bank of America, JP Morgan, Chase, Morgan Stanley, Countrywide—were all intimately involved in the mortgage fiasco. They profited, bigtime, from the Greenspan Bubble, and now they expect their bought-and-paid-for presidential candidate to bail them out – and he hasn’t disappointed them.
-- - enantiodromia, on 07/03/2009, -4/+16too long, didn't read, eh? i don't blame you, there were a lot of words in that article.
- thejackyl, on 07/03/2009, -4/+15Finally! A scapegoat! We can all rest easy now, it was all Goldman Sachs fault.
- mockupscaledown, on 07/03/2009, -1/+12Can we rewire your enter key to be a space bar?
- specialK16, on 07/04/2009, -0/+10You are right, but I find it a million times more unethical to give those credits, and then technically bet against them, knowing that they would fail.
- inactive, on 07/03/2009, -1/+11no they weren't, the system was deregulated, and you could sell these ***** loans with good loans to get them a good rating.
that's how everyone got *****. - Presbyterian, on 07/03/2009, -21/+31Goldman Sachs is no angel, but you can't pretend those people didn't know they were buying homes they couldn't afford.
You're being very disingenuous. - ACiDGRiM, on 07/04/2009, -1/+10If you honestly think that the TEA parties are just purely ignorant people who want to blame everything on their neighbours, I invite you to form your OWN opinions without the aid of MSM talkingpoints.
- emmeron, on 07/04/2009, -2/+11Anyone who thinks republicans or democrats are going to do anything but ruin this country further is either delusional or moronic.
- inactive, on 07/04/2009, -0/+9His name is Henry Paulson
- 32bytes, on 07/03/2009, -4/+13Obama included ?
- Munk3y, on 07/03/2009, -1/+10Oh, there's something we can do about it. We're just not at that point yet.
- shig, on 07/03/2009, -0/+9FTA "if the Democratic Party that it gave $4,452,585 to in the last election manages to push into existence a groundbreaking new commodities bubble"
If one were to look at it with unbiased eyes they will come to the conclusion that it's equal parts corporate and government interest that create bubbles. We need the separation of economics and state, just as much as we need the separation of church and state. - thecoolestguy, on 07/03/2009, -5/+14@Altanar,
Goldman Sachs gave more than 4X more to Obama than to McCain.
Wall Street generally prefers the Democrats over the Republicans because they support centralizing power more (giving more power to the federal reserve, opposing Ron Paul's legislation to increase transparency by auditing the Federal Reserve, more bailouts, more central government directed spending, etc). - enantiodromia, on 07/03/2009, -1/+9too long, didn't read, eh?
tell us how Goldman-Sacks lost money. they got their TARP money. they got AIG's TARP money to cover their risky bets.
GS profits no matter which direction the market movies, just as long as the market moves in huge ways. this whole story is about how GS causes the market to move in huge ways unfairly, and to the detriment of the country. - SamSks, on 07/03/2009, -0/+8I'm glad it was reposted! I missed it the first time around and now I know about it and can read it.
- RonPauls, on 07/03/2009, -17/+25unchecked?
get some economic/history education - JigoroKano, on 07/04/2009, -0/+8I would think that Wall Street would give the most donations to the expected winners... especially given that they are basically professional gamblers.
- JasonHaley, on 07/04/2009, -0/+8"By 2008, a barrel of oil was traded 27 times, on average, before it was actually delivered and consumed."
- thecoolestguy, on 07/04/2009, -1/+9tacoman, it doesn't matter if there's a D or an R in front of their name. Ron Paul is a Republican and is not controlled by corporations, which is why he was marginalized by the MSM.
Any way, my post is about the teaparties. They were not a Republican or a Democrat protest. They are a protest against big government in general. They threatened the economic power of the largest banks and the politically connected elite in America. - gn84, on 07/04/2009, -1/+9@Altanar
Did you actually look at the numbers from the links you posted? GS is the #2 slot on Obama's list (and first private organization), with $980k. The number one on McCain's list is $370k. Citigroup, JPMorgan, MorganStanley, etc, all gave at least twice as much to Obama as to McCain. To suggest that Obama is any less beholden to these banks than McCain is ludicrous. If you voted for Obama thinking he would not follow "advice" from the bankers, then you are a fool. - tacoman359, on 07/04/2009, -1/+8Its amazing when people like you are ignorant. Read the article, prove it wrong, and then we can talk.
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