One of the things that has been striking as revelation of bad behavior in the collateralized debt market has gotten more press is that a number of commentators who had taken the “nothing to see here, move on” stance have gotten religion. Even more dramatic has been the change in perception of Goldman. The firm […]
Read more...This is a post I wrote earlier today at Credit Writedowns. As I said yesterday, investment banks are institutions which do fulfil a useful role in society. I would define their role as companies where large institutions and governments receive financial advice and raise capital. Goldman Sachs is an investment bank. As such, Goldman must […]
Read more...Enjoy! You can view the segment here. PS Reader Independent Accountant correctly chided me for giving the bill too high a grade. This part was a classic example of anchoring.
Read more...It’s ironic how the “Goldman was so smart to have shorted subprime” meme is now being turned on its head in the MSM as Goldman’s conduct in the run-up to the crisis is begin re-examined in a new light. The underlying premise of the Goldman defenders is that it is fine for the firm to […]
Read more...By Tom Adams, an attorney and former monoline executive, and Yves Smith Despite extensive credit crisis post mortems, many of the widely accepted explanations of what happened are at odds with facts on the ground. These superficial explanations are hard to dislodge because they tally with widely held beliefs about how the real estate and […]
Read more...A 15 year veteran of Wall Street who put us on to Magnetar disappeared unexpectedly, much to our concern. He resurfaced recently and gave us a bulletin: Sorry I’ve been out of touch so long. It’s just that I’ve become quite disappointed/disaffected by the whole thing. We have failed and “they” have won. All the […]
Read more...By Tom Adams, an attorney and former monoline executive The SEC’s complaint against Goldman Sachs on its Abacus 2007 AC1 transaction may have impact beyond just the facts in that particular deal. The case has touched off a firestorm of reaction across the globe now that a government enforcement agency has dared use words like […]
Read more...Goldman pointed avoided discussing its pending SEC lawsuit directly on its conference call earlier today, but other reports suggest it is taking an even more pugnacious stance than its initial press released indicated. From Politico: Goldman’s crisis strategy…is already clear: An attempt to discredit the Securities and Exchange Commission by painting the case as tainted […]
Read more...By Andrew Dittmer, a mathematician with hedge fund experience, and Richard Smith, a UK based capital markets IT consultant Readers of this blog are by now familiar with the incredible story of how a single hedge fund (Magnetar) managed to play a shockingly extensive role in inflating the housing bubble in 2006-2007. The story was […]
Read more...By Yves Smith and Tom Adams, an attorney and former monoline executive Both the traditional media and the blogosphere have taken an almost obsessive interest in the suit the SEC filed against Goldman last week with regard to one of its synthetic real estate related CDOs, Abacus 2007 AC1. Goldman’s shares and the stock market […]
Read more...By John Bougearel, author of Riding the Storm Out and Director of Financial and Equity Research for Structural Logic “The whole intellectual edifice collapsed.” ~ Alan Greenspan “Blaming individuals [or a few institutions] is no substitute for acknowledging the failure of the whole system.” ~ ` BOE Mervyn King ~ Quotes excerpted from Yves Smith’s […]
Read more...By Gonzalo Lira, a novelist and filmmaker (and economist) currently living in Chile Traditionally, the way that the Wall Street-Hollywood relationship works is, Wall Street arrives in Hollywood with much pomp and circumstance, carrying boatloads of cash to invest in movies. Hollywood—delighted with this new money—steers Wall Street towards some “premiere” and “prestige” projects. Wall […]
Read more...The Wall Street Journal reports that Dutch bank Rabobank has filed a suit alleging that Merrill Lynch engaged in teh same type of behavior as Goldman did with John Paulson, namely, devising a CDO on behalf of a hedge fund who was using it to take a short position, and not disclosing that fact to […]
Read more...We received a copy of the document via e-mail and assume this is being leaked broadly (which begs the question of whether this was by happenstance or deliberate. The proximity to the filing of the suit suggests the latter). Richard Smith published it on ScribD: Abacus-2007-AC1-INDICATIVE TERMS Update 8:15 PM: Several items jump out. First […]
Read more...Bloomberg reports that Senate Agriculture Committee Chairman Blanche Lincoln is expected to table a proposal to require commercial banks to separate their derivatives operations from their commercial banking activities. The intent is to prevent banks from using cheap deposits to subsidize risky derivatives businesses, and thus eliminate the government backstopping of these activities. This “no […]
Read more...