The bank that shagged us: Bailout recipient Goldman Sachs now rakes in record sacks of gold
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Normally careful with its words so as not to sound unfriendly to business types, Bloomberg News phrases it just right this morning, saying that Goldman Sachs "took $10 billion from the U.S. Treasury's bank-rescue program in October."
But the public got took worse than that. Now it turns out that Goldman hauled in more than $100 million in trading revenue on a record 34 days during this year's first quarter.
"It was a good quarter," one analyst is quoted as understating.
Yes, but what the story doesn't point out is that, aside from its deep connections to not only the Bush regime but also the Obama regime, this development was just a more subtle, but very effective, bailout of Goldman, which is led by the lookalike duo of Chairman and CEO Lloyd Blankfein and President and COO Gary Cohn.
The story notes out that Goldman's traders were extremely aggressive and took more risks. Well, you would, too, if the FDIC were propping you up by making it easier for you to borrow money to front your stepped-up gambling games.
Yes, the aim has been to get the investment money start flowing again, but does it have to gush like a fucking oil well? Goldman has gone from being supposedly so ailing that it had to be bailed out to now so flush that it's setting revenue records.
The Bloomberg story provides clues:
The average interest rate Goldman had to pay for unsecured — yes, unsecured, lucky them — short-term borrowings for its dealmaking fell to 2.14 percent in March from 3.37 percent last November. Based on those figures, that works out to a 36 percent drop in the interest rate that Goldman had to pay to get its money to gamble with.
Mind you, this is while your banks are not only adding all sorts of fees but have even retroactively increased the interest rates on your already existing credit-card balances.
And how have the oligarchs at Goldman managed to stay intact enough to authorize these new, aggressive, lucrative trades? How has it stayed above the meltdown and its aftermath that fried its competitors to a crisp? We already knew, of course, that Goldman's ex-CEO Hank Paulson was the last regime's bailout czar when Goldman got bailout money. More recently, we learned that retired Goldman chairman Stephen Friedman is part of current Treasury Secretary Tim Geithner's inner circle of jerks.
Just a couple of days ago, the Wall Street Journal pointed out more details on Friedman that help make sense of today's news that Goldman made a killing during the first quarter. From the WSJ's May 4 "New York Fed Chairman's Ties to Goldman Raise Questions" — sorry this is a full four-graf excerpt, but it's all juicy and explanatory:
During that time, the New York Fed's chairman, Stephen Friedman, sat on Goldman's board and had a large holding in Goldman stock, which because of Goldman's new status as a bank holding company was a violation of Federal Reserve policy.
The New York Fed asked for a waiver, which, after about 2½ months, the Fed granted. While it was weighing the request, Mr. Friedman bought 37,300 more Goldman shares in December. They've since risen $1.7 million in value.
Mr. Friedman also was overseeing the search for a new president of the New York Fed, an officer who has a critical role in setting monetary policy at the Federal Reserve. The choice was a former Goldman executive.
1 comment(s) / Post a Comment
that picture is hilarious. the argument of gs having an unfair advantage is getting old. do they have a lot of sr executives in the gov't and fed? of course they do and it's no coincidence they make more money than other banks as it says a lot about the caliber of people and their work ethic w/in their organization. if u were an athlete, would u only try to gain a few yards or bust your ass to make it to the end zone? nevermind, i think i know the answer. U probably get infuriated when there is a dominant franchise in sports too. then who's fault is it? gs unlike a jpm or some of the other banks that recieved gov't money doesn't issue very many if any public credit cards so that argument is flat-out wrong. stop crying and look at the bright side of this in that gs executes it's business as well as it does. they could be more like some of the others who have received a lot more taxpayer money and lost tens of billions of it. then again, that would probably make someone like u very happy.
Posted On: Wednesday, May. 6 2009 @ 2:26PM