Wednesday, March 17, 2010

Goldman Rules / Obama Obeys


Goldman Sachs rules Wall Street, its alumni permeate the Obama administration, its derivative liability equals over 33% of its assets and Obama continues to subsidize it with zero interest fed loans with no real reform in sight: Allen L Roland

The latest data on derivatives is truly impressive ~ JPMorgan Chase, for example, held derivatives worth 6,072 percent of its assets at the peak of the bubble in 2007. The other two giants, Citigroup and Bank of America, although still far behind Chase, had 2,022 percent and 2,486 percent respectively. Goldman Sachs, the other giant, had an astonishing amount of derivatives on its balance sheets: 25,284 percent of assets in 2008 and 33,823 percent as of June 2009. Citigroup and BOA now have more of this risk on their books than before the crisis (FDIC SDI database).
"This simply adds to the point that despite all the histrionics and efforts in Washington, nothing has been learned and the American Banking system is now at least at as much risk now as in 2007, pre crash."

Obviously, Goldman Sachs still rules Wall Street with what Michael Lewis calls 'An elegant form of theft ' while being subsidized by the Fed with zero percent interest loans despite the fact that Wall Street is still sitting on over 1.5 trillion dollars in junk sub prime loans. Goldman was also the number one financial contributor to the Obama presidential run and his administration is stocked with Goldman alumni ~ so when Goldman speaks, Obama indeed listens and obeys. But we are talking about potential criminal violations regarding Goldman which cannot be ignored or swept under the rug. Senator Ted Kaufman appears to be hot on the trail of Goldman and rightfully says ' that Fraud is still at the heart of Wall Street.'

Baseline Scenario's Simon Johnson sees Sen. Ted Kaufman pursuit of criminal violations more promising than Dodd bill: "...he actually lays out the parameters of what should be, if our legal institutions still functioned, a compelling case against Goldman ... This sounds like a potential violation of Rule 10b-5 - you are simply not allowed to sell securities in the United States while withholding material adverse information ... [Kaufman] he is a member of the Senate Judiciary Committee and we are discussing here potential crimes..."

If you didn't watch the Steve Croft 60 minutes interview of Michael Lewis, author of the Big Short, on Sunday night ~ here it is. Lewis explains how the big banks rule the rating agencies and how Goldman is the biggest ruler of them all ~ bullying AIG to insure billions of dollars of worthless sub prime mortgages which they obviously knew were junk and then cashing in when they collapsed in 2007 and then collecting again when AIG repaid them again with billions of TARP bailout money.

It's a big casino game, folks and we're not in it ~ but we are most certainly paying for this continuing financial time bomb with no real reform in sight.

Michael Lewis / The Big Short / 60 minutes interview

Here's the full Goldman story with its glittering cast of characters in this illuminating ( 10 minute video )

Allen L Roland

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Allen L Roland is a practicing psychotherapist, author and lecturer who also shares a daily political and social commentary on his weblog and website allenroland.comHe also guest hosts a monthly national radio show TRUTHTALK on

Freelance Alternative Press Online columnist and psychotherapist Allen L Roland is also available for comments, interviews, speaking engagements and private consultations ( )


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