Goldman Sachs: Request for help

Sun, 10/05/2008 - 7:30am — lambert

[I encourage all Correntians to adopt their own parasite. There are so many to choose from! -- lambert]

Since I've adopted Goldman Sachs as my parasite, I've got some questions.

There seems to be theory running around that Goldman Sachs issued a profitable ton of (fraudulent, like them all) mortage backed securities and then, brilliantly, shorted the market for them because they bet the crash was coming. (And why wouldn't it? Markets based on fraud do tend to crash.) That's why they're one of the few banks still standing and Hank Paulson has 5% of our economy to play around with today.

Since I know nothing about finance, is that even plausible? I feel kinda like a kid playing with power tools, here. And does anybody have any more precise intelligence than the Sean Olender article cited above?

Olender's a lawyer, which doesn't predispose me to dismiss him (tobacco settlements), but does make me want corroborating evidence. Readers?

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Can't help with your question, but here's a surprise:

By badger on Sun, 10/05/2008 - 10:29pm

PHILADELPHIA (Reuters) - U.S. Treasury Secretary Henry Paulson is expected to name Neel Kashkari to oversee the $700 billion program to buy distressed assets from financial institutions, The Wall Street Journal reported on Sunday.

Kashkari, a Treasury assistant secretary for international affairs and a former [wait for it ....] Goldman Sachs banker, is expected to be named interim head of Treasury's new Office of Financial Stability as early as Monday, the newspaper reported in its electronic edition.

There's something about that name too ...

You mean like "cash and carry"?

By lambert on Sun, 10/05/2008 - 11:08pm

Online WSJ:

Mr. Kashkari's presentation takes a more aggressive stand against a broad bailout than the Treasury Department's usual public posture. "Homeowners who can afford their mortgage but walk because they are underwater are merely speculators," Mr. Kashkari's slideshow reads. "It's not the government's job to make people whole for their investment losses."

True enough, I suppose. "Our" government does seem to take a far more sympathetiv view with infestment bankers, though....

The whole Indian nuclear deal, now -- I wonder if that was India's price for buying some of our toxic waste?

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

—

"First they ignore you, then they ridicule you, then they fight you, then you win." -- Mahatma Gandhi

Here's

By badger on Mon, 10/06/2008 - 12:38am

a bio:

Neel Kashkari is Senior Advisor to U.S. Treasury Secretary Henry M. Paulson, Jr. He provides counsel to the Secretary on key policy matters.

Prior to joining the Treasury Department, Mr. Kashkari was a Vice President at Goldman, Sachs & Co. in San Francisco, where he led Goldman's IT Security Investment Banking practice, advising public and private companies on mergers and acquisitions and financial transactions. Prior to his career in finance, Mr. Kashkari was a R&D Principal Investigator at TRW in Redondo Beach, California where he developed technology for NASA space science missions such as the James Webb Space Telescope.

Originally from Stow, Ohio, Mr. Kashkari graduated from the University of Illinois at Urbana-Champaign with a Bachelor’s and Master's degree in Engineering. He also received an M.B.A. in Finance from the Wharton School. Mr. Kashkari and his wife Minal maintain residences in Maryland and California.

and here's a picture (without Mr. Bigglesworth or Mini-Me).

don't forget Dems--Corzine and many

By amberglow on Mon, 10/06/2008 - 11:14am

others--there are former Goldman people all over DC in both parties.

WSJ article about a 94-year-old guy

By pie on Mon, 10/06/2008 - 3:53pm

who's the chief investment officer of his company (which manages $1.8 billion for wealthy individuals and a few pension funds).
He worked on Wall Street in 1929 and lived to tell about it. Some of his thoughts about the "crisis":

"You have one conspicuous difference between this and the 1929 break," he said, using a common Wall Street euphemism to avoid saying "crash."

"In the '29 break you had [President] Hoover and [Treasury Secretary] Andrew Mellon contracting all the way. They believed that it wasn't the role of the government to get involved. This time, the government is moving heaven and earth to reverse the cycle," he said.
...
For all his years on Wall Street, he has no sympathy for those who led us into the crisis.

"People are frightened and very angry," Mr. Glickenhaus said. "They feel that everything that has been done is to benefit Wall Street and these preposterous salaries and termination pay packages that leaders of these companies get, irrespective of how good or bad a job they have done. In some cases, they did a more miserable job than you believe. I am not so pessimistic about the future of the stock market. I am more pessimistic about the future of business."

Anyone see it getting better anytime soon - making necessary changes in the way firms DO business and reregulation?