Today is a huge day for finance nerds: it's as if a very famous wrestler were stepping into a cage with another very famous wrestler (sorry, I'm not a wrestling nerd). Anyway, this afternoon Goldman Sachs's top executives will appear before the Senate subcommittee that's trying to determine why, exactly, the econopocalypse happened.
But Goldman Sachs finds it awfully interesting that they're being called before this particular Senate panel less than two weeks after the Securities and Exchange Commission filed charges accusing the bank of defrauding investors by selling them a CDO investment called Abacus 2007-Ac1, even as the hedge fund that built Abacus out of crappy, overleveraged housing loans bet against it.
What did the Senate know and when did they know it? Is this whole thing a conspiracy to make Goldman Sachs take the fall for everything that's happened? Lloyd Blankfein seems to think so…
In prepared testimony, Blankfein reiterated that his firm was simply trying to balance its mortgage investments and did not bet heavily against the housing market — known as shorting — or against the interests of its clients.
"We didn't have a massive short against the housing market and we certainly did not bet against our clients," Blankfein said, adding that Goldman lost $1.2 billion on housing investments in 2007 and 2008.
See? They lost $1.2 billion of their own money. What more evidence do we need that Goldman isn't at fault for the mortgage crisis? It's like if you shot yourself in the foot while attempting an armed robbery. That doesn't make you a perp.
That makes you the victim.
Tags: Banks, Economy, Goldman Sachs, Lloyd Blankfein, Money, Senate
You know, it's one thing for Goldman Sachs to have the balls to defraud investors and still hand out billions in bonuses, but it's almost like a bad joke that along with those balls their name is basically Gold Man-Sacks. Though, we can take some solace in the fact that they got rid of their original name, Iron-Scrot Asteroidnuts and Sons.
Stephen Colbert's take on the Goldman Sachs charges can be found below.
For quick summaries of recent episodes, be sure to visit Intel's Daily Show in :60 Seconds page.
Tags: CNBC, CNN, Fox, Goldman Sachs, Jim Cramer, Jon Stewart, Megyn Kelly, MSNBC, Rick Sanchez, Stephen Colbert, The Colbert Report, The Daily Show, Video, Wall Street
The problem with the financial system — okay, a problem with the financial system — is that nobody really knows how it works except the people who work in the financial system. This has been the rationale for employing Goldman Sachs alumni at the Treasury Department; it's also been the excuse given by regulators who didn't see the econopocalypse coming (not to mention hungover econ majors around the world).
Point being, now that the Senate has to vote on financial regulatory reform, everybody's frantically skimming their copies of Synthetic CDOs for Dummies…
"Some of these things are pretty arcane, especially for those of us who aren’t on the Banking Committee," said Sen. John Ensign (R-Nev.), who clutched a sheaf of PowerPoint talking points as he emerged from the first of a new series of regularly scheduled meetings for GOP senators to get up to speed on the details.
Well well, how very efficient and organized of the GOP!
Tags: Banks, Economy, Goldman Sachs, John Ensign, Money, Republicans
Goldman Sachs, once the invincible king of Wall Street, is in a lot of trouble. It is also in a very fancy new headquarters building. Let's examine the latter, because it's Monday morning and you'd probably rather read about "Awesome Abs" fitness classes than John Paulson's evil scheme to short the housing market.
It's true, the new Goldman HQ has a gym that offers an "Awesome Abs" workout, which is good because the people who invent the next way to screw your 401(k) should at least be sexy the cafeteria serves "French Toast Baba pastries," "a deep panini lineup" and "deadly cupcakes."
On the bearish side, vice presidents no longer have offices, and are forced to sit at "open-space workbenches" that the Wall Street Journal compares to "a typing pool." If these VPs are lucky they'll get promoted to managing director, which means upgrading to "windowless inside offices."
No consensus on the steam rooms, though…
The new steam rooms for men and women are drawing mixed reviews. Some employees find the idea of "steaming" with co-workers objectionable. Others, not so much. "Once you have seen your colleagues naked in the locker room, steaming with them isn't that weird," says one employee.
Uh-oh! Don't let Rahm Emanuel hear that.
Tags: Banks, Economy, Goldman Sachs, Money, SEC
Wall Street CEO's just couldn't make it to the White House to talk to the president about how they should start loaning money to people on account of a low-hanging cloud. That may seem like a lame excuse to you, but that's just because you're wrong.
Tags: Barack Obama, Citigroup, Economy, Goldman Sachs, Jon Stewart, Money, TARP, The Daily Show