Goldman Sachs: The Great American Bubble Machine

rollingstone.com:

In Rolling Stone Issue 1082-83, Matt Taibbi takes on "the Wall Street Bubble Mafia" investment bank Goldman Sachs. The piece has generated controversy, with Goldman Sachs firing back that Taibbi's piece is "an hysterical compilation of conspiracy theories" and a spokesman adding, "We reject the assertion that we are inflators of bubbles and profiteers in busts, and we are painfully conscious of the importance in being a force for good." Taibbi shot back: "Goldman has its alumni pushing its views from the pulpit of the U.S. Treasury, the NYSE, the World Bank, and numerous other important posts; it also has former players fronting major TV shows. They have the ear of the president if they want it." Here, now, are excerpts from Matt Taibbi's piece and video of Taibbi exploring the key issues.

Read the whole story: rollingstone.com

Comments

[PhilipTaylor]

Obama's SEC and/or Holder could simply arrest G0LDMAN and others for "Manufactured Insider Trading!"

Others for Misrepresenting products as LOW RISK "AAA" when they were HIGH RISK!

These are both Fraud Charges that are on the Books and many will qualify as Felony Charges.

These LAWS could be enforced Today or Tomorrow!

Chef Martha paid for something far less Catastrophic and Calculated!

Office of Comptroller of Currency, OCC, Report:

JPM has Astonishing $88 Trillion in Toxic Assets/Debts!
JPM has 225,000 employees
JPM has $391,000,000 per employee in Toxic Debts/Assets

Goldman has $30 Trillion in Toxic Debts/Assets
Goldman has 27,898 Employees
Goldman has $1,075,345,903 per employee in Toxic Debts/Assets

BofA=$38Trillion in derivatives
Citibank=$­32Trillion in derivatives & 300,000 Employees
Goldman=$30Trillion in derivatives & 27,898 Employees
Wells/Wach­ovia=$5Tri­llion in derivatives.
Britain's HSBC=$3.7Trillion in derivatives.

[citizensrus]

Derivatives ..mentioned as often in the media as single payer. Who is paying off the media to keep the DERIVATIVES scandal off the radar? Derivatives...the Weapon of Mass Destruction that hit our economy. Derivatives.. What percentage of the people would you estimate that don't know anything about derivatives? A well informed populace is the KEY to Democracy. Democracy is locked up right now.

[brownstoness]

With consumer deleveraging and credit crunch - we cannot have any quick recovery - L is best case scenario. Speculative stock buying and PPT euphoria is no substitute for anything.

Credit is falling so much - private credit decreased by $1.8 Trillion is the first quarter, consumer credit by $90.7 billion (annualized). Household net worth down by $13.87 trillion.

There is no trigger for recovery - new technology, new markets, demographics, new ideas. Green is just a boondoggle and BRICs can only do so much. JPM and GS etc are just trying to create another bubble - it suits their ends not yours.

hat tip to http://iamned.blogspot.com

[jsijason]

According to Goldman Sachs it is "an hysterical compilation of conspiracy theories" ...

Yet it is a very thoughtful article, full of eye-opening, mind-blowing evidence of fraud and completely unethical behavior.

The article is a must-read. It is amazing and infuriating to see this level of corruption in our country.

[citizensrus]

Goldman Sachs is worried or they never would have responded to Taibbi's article. Taibbi has done his research, he has solid evidence, he has dotted his i's and crossed his t's. He has presented a case and everyone who reads the article knows there is something to it.
Now the question is ..what will happen? Nothing?

[grateful4thedead]

HuffPost...c'mon, get on the Reuters report about the former Goldman employee arrested this weekend for allegedly stealing the crown jewel code of Goldman's quant program.

zerohedge.­blogspot.c­om has the FBI arrest affidavit already up.

this may have major implications on the markets as the code was lifted and "out there" for over approx. one month,. Read the affidavit.

thanks.

[James Croteau]

There seems to be 2 stories on this subject, the other is at

http://www.huffingtonpost.com/2009/06/25/taibbis-goldman-sachs-tak_n_220773.html?show_comment_id=26609668#comment_26609668

There is also Taibbi's blog piece on Obama Honeymoon, at

http://trueslant.com/matttaibbi/2009/04/09/summers-raked-in-27-million-in-speaking-fees-from-wall-street-44-washingtonpostcom/

[grateful4thedead]

hear about the Reuters story that just broke about Goldman? A former employee arrested by FBI and charged with stealing their quant trading code....this is pretty big stuff.

Huffpo, you guys need to get that story up on the big screen

[Blossom Twig]

Reading financial commentary so reminds me of The Parable of the Blind Men and the Elephant perhaps best retold by John Godfrey Saxe (1816-1887) in his poem of the same name.

http://www.kheper.net/topics/blind_men_and_elephant/Saxe.html Enjoy !

[oldsoulroller]

The so-called "Socialist" policies in the banking bail-out were not the real thing, far from it. Was more like the "Privatization" of the U.S. Treasury by private and public interests. Call it right when it is wrong don't make it so.

[oldsoulroller]

Great reporting from a man that has an ability to cut to the nuts of the problem. I'm tired of the breadth of vacuous ambiguity that exist in the media today. Sometimes there ISN'T two sides of the story. Enlighten us with a layman's language of the opaque, and occluded events that effect us to our overall detriment and do it in your own irreverent way. Great investigative work Matt!

[FollowtheDough]

Free Market Economics is a deluded religion which is a integral cancerous component that has helped destroy this country as a manufacturing base for starters. Just admit it, you were suckered into this bullshit. It's really simple. Here is the formula: We live in a finite world that can't sustain infinite greed. Learn it and stop promoting the killing of our country. God, why we even have to deal with this crap in our country. Your philosophy FAILED. Newsflash: Human Beings are Predatory when it comes to greed. They don't play by rules or regulations. And again, the freemarket is a theory not a law like gravity.

P.S. Freemarketeers you arent following capitalism. Freemarket thought has led you to what you despise: Corporate Socialism. Welcome to Corporate Socialism. But that is all part of the concept of projection anyways.

[Rule Of Law]

test

[jsijason]

Absolutely

[FollowtheDough]

Free Market is the financial equivalent of Scientology. There is no Free Market. Your idols cheat and theft our nation to create a veiled mirage of wealth that actually doesn't exist. And I want transparency here and ethics. Instead we get scapegoats how the poor are stupid. I would edit that to say the lackeys of the freemarket are willfully ignorant.

To put it bluntly: There is nothing free about this market. It's a theory for hucksters,­hoaxers,co­n men,hysterical ravings for why corporate businesses can reign over the world if they please with no consequences. Which by no coincidence alot of economic majors follow this gem of a philosophy as well including Greenspan.

"The two met through Greenspan's first wife, the artist Joan Mitchell, in 1951. He became fascinated by Rand's free market ideology, and began attending weekly in her apartment in 1953, which featured draft readings of Atlas Shrugged - which he later defended in a letter published in the New York Times to respond to a bad review.

Alan became a champion of a completely free market under Rand's influence. He believed that responsible investors and business men will practice in such a way that benefits their own interests, and that regulations disturb the natural balance created by mutual self interest. He even penned several articles in the 1960's that Rand edited that are considered brilliant Objectivist works in their own right."

from: http://www.pubrecord.org/nationworld/439-alan-greenspan-ayn-rand-and-the-credit-tsunami.html

[TJCole]

I like that comparison with Scientology...it is a very cult like dialectic that these weasels learn to regurgitate as their mantra and repetition for some people becomes truth..!

What we need is real reform of not just our banks but the entire banking culture and it could be done if there only were the leadership...!

It could be done but not by this president not the way he is carrying on full speed in the worng direction with these duplicitous bankers at the helm...!

[Rule Of Law]

Follow--You had me with your first paragraph! Probab;y because I've been saying the same thing.

There is no "free market." Not in the Darwinian, survival of the fittest, genetic imperative sense of the word. If it were truly dog eat dog, best product and pricing wins, we could probably live with it. That kind of competition, unfettered by cronyism, old school ties, and east coast Ivy League axis of weasels manipulation, would undoubtedly give rise to great products and a truly vibrant economy.

But study how business has been done, since Washington sold the government on the idea of building the Capitol on some swampland he just happened to own, to the Robber Barons--especially Stanford, Crocker, Huntington and Hopkins--who'd never run much less built a railroad--and how they used their bribes and insider connections to get their project financed and built. Then read how these supreme egotists all claimed it was up from their own bootstraps, eminent domain, will of gawd, rugged individualism and raw American drive and determination that made it happen. And how the Press of the day mythologized all these men, Carnegie, Rockefeller, Morgan, etc and built an entire false view of the world for the poor in America to believe.

[DrPneumann]

GOLDMAN SACHS WINS AGAIN:

The New York Stock Exchange quietly announced last week that it would end its practice of requiring companies to report all their program trading — a move that helps shield large investment banks, particularly Goldman Sachs, from public scrutiny.

The new rule means the public will no longer be able to tell if large investment banks are manipulating the stock market for their own gain, says Matt Taibbi, the journalist whose Rolling Stone article on Goldman Sachs’ role in asset bubbles over the past century has rocked the financial world.

According to previous NYSE rules, any company that carried out program trading — essentially, large computer-automated trades worth more than $1 million — had to report the trades to the NYSE, which then made the information publicly available.

But, under new regulations (PDF) published last week, that requirement has been removed.

http://rawstory.com/08/news/2009/07/04/taibbi-nyse-ends-transparency-to-protect-goldman-sachs/

[marijam]

Blogs such as Zero Hedge have been using NYSE data to argue that Goldman Sachs now has an almost unfettered ability to control stock prices.

[TJCole]

They do, they are controlling the commodities and futures market by manipulating prices predicting them, and then manipulating them to those very levels..!

[ErnestineBass]

"...under NEW regulations..."???

That sounds more like NEW DEregulations to me.

OMG! Goldman Sachs completes hostile takeover of Merriam-Webster!

[Rule Of Law]

Apparently for some reason I can't seem to encourage others who have been a buzed by certain borg posters to write in to (stupid spellings now...) Phuff IN ton Phost to register their complaints. Tried 3 times to let you know that HS, Rhampage and Neeeeeeeeeeeewman have been copied and pasted to a number of folks over there that I've had previous dealings with, all to no avail.

Still encouraging others to be proactive in containing this infan tile behavior on the part of a few.

[lobern]

WHY ARE WE NOT HEARING MORE ABOUT THE ROLE OF GOLDMAN SACHS IN THE FINANCIAL CRASH? NO OTHER NEWS SOURCE SEEMED TO PICK UP ON MATT'S ARTICLE, AND WHERE IS PAULSON??? HAS HE DROPPED OFF THE FACE OF THE EARTH?
PLEASE KEEP THIS INVESTIGATION GOING.

[Rule Of Law]

Think about who owns the MSM? Corporations with international concerns. I remember asking nearly two years ago for Hale "Bondad" Stewart to recap for us exactly who the players were in the creation of the first Great Depression. Now, I admire Hale and his columns and graphs are spot on--as far as they go. But I got zero response on my question--probably because it is just too darn dangerous to stir those waters. You can talk about what happened in economic science terms--the general hoo ha that passes for MBA studies and ignores the acts of a few powerful and wealthy people gaming the market. But, apparently, at least until Taibbi, you can't name names.

Do your own study on who was on top before the Depression, and who emerged more powerful and more wealthy after the Depression. Same companies, same families. And not because they are smarter or tougher or even richer to begin with. But because they own the market. It's like playing cards in Vegas and knowing what the dealer is giving everyone before it's dealt.

[Rule Of Law]

As does this one--

Think about who owns the MSM? Corporations with international concerns. I remember asking nearly two years ago for H,a.le "Bon--dad" Ste.wa.rt to recap for us exactly who the players were in the creation of the first Great Depression. Now, I admire Hale and his columns and graphs are spot on--as far as they go. But I got zero response on my question--probably because it is just too darn dangerous to stir those waters. You can talk about what happened in economic science terms--the general hoo ha that passes for MBA studies and ignores the acts of a few powerful and wealthy people gaming the market. But, apparently, at least until Taibbi, you can't name names.

Do your own study on who was on top before the Depression, and who emerged more powerful and more wealthy after the Depression. Same companies, same families. And not because they are smarter or tougher or even richer to begin with. But because they own the market. It's like playing cards in Vegas and knowing what the dealer is giving everyone before it's dealt.

[Rule Of Law]

Sorry for the double post--someone was asleep at the switch.

[mredder4]

Matt Taibbi is not an author that can be trusted not to let his own feelings influence his piece. In this case, my guess is that he decided to do a story about how Goldman Sachs manipulated the market, so he went out and sifted until he found enough evidence to support his foregone conclusion.

[cavegal]

So you do not believe that GS manipulated anything? Please did you at least read the article or are you automatically dismissing it because it is published in Rolling Stone?

And what journalist is completely unbiased? All publications have a particular slant dependent upon the editors, owners and the advertising revenue that keeps them afloat.

[Rule Of Law]

My goodness, all he need do is google GS and 100's or articles by a wide variety of true experts in economics and business, not to mention government, banking, and investigative journalism, pop up! This is not just Taibbi grinding an ax. This is Taibbi trying to get a world of info out to the masses that we need to read.