Paul Krugman Slams Goldman Sachs: What It Does Is Bad For America

New York Times:

The American economy remains in dire straits, with one worker in six unemployed or underemployed. Yet Goldman Sachs just reported record quarterly profits and it's preparing to hand out huge bonuses, comparable to what it was paying before the crisis. What does this contrast tell us?

Read the whole story: New York Times

Comments

[Lorianne]

Goldman Sachs in Talks to Acquire Treasury Department
http://borowitzreport.com/

[Tinsdale]

Obama Score Board. Update. July 2009:

Goldman Sachs-Record Profits
GS.Stock Price: Year to Date: + 85%
Michigan-U­nemploymen­t rate: 15.2%
Rhode Island-Unemployment rate: 12.4%
Oregon-Unemployment rate: 12.2%
South Carolina-U­nemploymen­t rate: 12.1%
Nevada-Unemployment rate: 12%

Obama Economic Action Plan. Update. July 2009. Past & Pending Action Items:

1. Goldman Sachs, their associated companies and colleagues: Write blank check
2. American auto industry, associated labor unions and its industry supply chain companies: Force Bankruptcy.
3. Troubled Wall Street Money Center Banks: Write blank check
4. CIT. Money source for American small to mid-size business: Force Bankruptcy.

[dukeitout]

The doctor is an excellent teacher because he clarifies things that are confusing to most including me. It sounds like Goldman Sachs is excellent at what they do. They do it in a legal manner. And they make a huge profit doing it. The problem is that its' success can be ruinous to America since GS's profitablility is dependent on their ability to loan money to poor credit risks and quickly market those obligations (ex. mortgages) to many others throughout the world. They don't seem to have any responsibility to stand behind the defective product. This is legal, thanks to Reagan, Bush I, Clinton, Bush II and Congress) but wrong. Let's fix the law.

[youtubeit]

this economy is in such deep *&^ yet Obamma & Summers live on another astral plane, unwilling to aknowledge reality, even though 995 of Americans expiernceit and KNoW what's going on, and are tired of the BS.

good articles: http://www.iamned.com

[jian1312]

Where do I sign my name to the petition to FIRE Larry Summers???

He and Geithner both should go, but Summers should go first since it's probably easier politically, also he's behind all this financial bailout. He maybe smarter than all of us combined, but he doesn't see the obvious - the way Wall Street works is not only shameful but also self-destructive. One doesn't need to have a PhD in economics to know this by now. We can't save our economy by going about it the same way, coz that's what got us in the mess.

So, someone please start a petition to fire Summers.

[jian1312]

Where do I sign my name to the petition to FIRE Larry Summers???

He and Geithner both should go, but Summers should go first since it's probably easier politically, also he's behind all this financial bailout. He maybe smarter than all of us combined, but he doesn't see the obvious - the way Wall Street works is not only shameful but also self-destructive. One doesn't need to have a PhD in economics to know this by now. We can't save our economy by going about it the same way, coz that's what got us in the mess.

So, someone please start a petition.

[not going2take it]

I feel like the billions in payments to employees

IS MORE LIKE HUSH MONEY
keeping them quiet, keeping their
OBVIOUS *secret* ; | among them.

THESE BONUSES ARE .B.R.I.B.E.S.

[jimrs6]

Goldman is profitable. Of course Krugman dislikes them. To him, profits are simply money that the government could have spent better.

[northstar11]

goldman got 60 billion from various government sources for FREE --

I think even a novice such as yourself could do as well.-------the trick is to get the FREE CASH

[northstar11]

another thought for you junior--without the bailout goldman was toast

[land2341]

Goldman is not profitable. It is an inherently flawed and unstable business model which will enrich a very few at the expense of the entire economy. You can only rob the poor for so long until they have nothing left to steal. They may be able to use my tax dollars to pro this puppy up for a while longer, but it is bound to fail again.

[chewmin68]

I think what many US citizens do not realize is that our financial institutions, corporations, etc., have no loyalty to the United States. The world is global, and with enhancements in communications and technology, they would be stupid to care about any country, except of course the latent wealth of many US citizens who are totally bushwacked in thinking the US is something other than a global marketplace. Those US citizens are still there for the fleecing, and the elite let no opportunity to fleece go untouched. We are going to 3rd world standard soon. And the billions of people on this planet that let a few steal their laobr and wealth seem to continue to live in dumb complacency. If you read human history, it has always been this way, and from what I see, always will be.

I have tried to do the right thing. Long term job with benefits and pension, savings for my future. My pension went to PBSC, soon to become bankrupt, my health insurance? . None for years. The modest home, small mortgage, big downpayment? Only owe little, but no job, old, no work for older workers. I did the right thing alright. I made it possible for the rulers, the few of the wealth base to take my dreams and my life. I bought into this joke. No party represents me. Obama is a big disappointment. I now know who the government is for, and it's not the majority of the people. I

[ThinkDeeper1]

This is one of the most insightful posts I've read concerning this article so far today. I've been proclaiming this for several years and my words have only fallen on deaf ears.

All the false patriotism, racial and gender arguments, are just a deceptive front to hide the real perilous issues facing America. In reality, corporate leaders have no loyalty to America, no loyalty to any race or gender, no concern for the success of America's future. They are only loyal to greed and money. The color of capitalism is green, not white, black, brown or yellow.

If corporate America can keep the majority (middle class) fighting about race, gender, who's a real American versus a phony, which political party should be in office, etc, within 40 years America will be following the orders of another nation while living at a third world status.

Hint: The corporate elite pay huge sums of money to political pundits on the airwaves to keep us focused on the irrelevant, divisive, and hateful elements within our society while they pilferage the nation and ensure that they have enough money to move and live luxuriously anywhere in the world. Rush Limbaugh isn't filthy rich because his listeners send him checks. Rush, Sean, O'Reilly are all rich because of corporate sponsors, etc., in exchange for the great "snowball" job their doing on the middle class.

Who cares if you're a democrat or republican. There's too much corruption in all of our political parties.

[land2341]

I too have been pointing this out for years. Since the Reagan/Milton Freidman years when business schools exhorted students to forget any corporate policy that was intended for the communal good and focus only on the job of making money, this country has been on a downhill slide. The Chicago school of thought taught that the only job of corporations was to make a profit. Forget paternalism, forget loyalty to employees, forget obligations to even the long term well being of the corporation - make money and make it now. Once you take such an ethos global you have multinational corporations who are beholden to - essentially no one. They claim to be beholden to stock holders, but the employees of these businesses are not even loyal to the business itself. They are involved in a cash grab free for all in which each employee uses the framework of the business to get the most for himself, even if it is at the expense of the long term good of the business.

If I said to you if you do this perfectly legal thing at work today you will go home with 20 million dollars - but everyone else in your family would end up bankrupt, most people would, at the very least, hesitate. But what if I said you can get the money and 100 people around the world that you don't know would lose everything? People take the money and run. Welcome to the new financialized economy.

[Firbolg]

This is so true, its depressing.
Corporations are no longer interested in nation states other than as somewhere to park their outlets and offices while they scour the globe to find and take over the most for-sale politicians and governments. With these under indentured servants then create unregulated markets, cowed and ignorant consumers and tax havens to stash their masters’ loot.
Then when they have bled a particular nation dry there is not much left of interest to keep them here except to make sure that, as in our case, Congress gathers up every stray dollar and sends it to them quickly as with, for example, healthcare “reform”.
What beckons them now are 2 billion plus innocent and eager future super consumers in Asia and elsewhere waiting for the benefits of vulture capitalism, many of whom are corralled in nations that don’t even have the constraints of faux-democracy to get in the way.

[Coastalthinker2]

Beginning with chewmin68, this is one of the most insightful threads I have seen on here for a while. Thank you and I couldn't agree more.

[BurtonOerney]

"You can argue that such rescues are necessary if we’re to avoid a replay of the Great Depression. In fact, I agree. "

"This time, new regulations are still in the drawing-board stage — and the finance lobby is already fighting against even the most basic protections for consumers. If these lobbying efforts succeed, we’ll have set the stage for an even bigger financial disaster a few years down the road."

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So from this article and his previous one, I don't hear Krugman saying the Obama administration's response to this crisis is wrong - only that it would have been nice if aid to states had not been cut from the stimulus and that new regulations need to be implemented over the objections of lobbyists.

I would like him to directly address the regulatory proposal again, giving us his opinion as to exactly what the final package should look like. I think that if Elizabeth Warren's commision could propose a package that both theoreticians like Krugman and Galbraith and officials like Geithner and Bernanke agree would be optimal, then lobbyists would have a difficult time getting the votes to defeat it.

[KipRip]

The last thing GS wants is a free market whatever the commodity. They want a market they are free to manipulate and position themselves in that market so whatever outcome they are poised to profit usually at the cost of the public.

[espressobeans]

Meanwhile, the unemployed are told to be patient -- in a few years they can expect their recovery to trickle on down.

[Rule Of Law]

Did you read yesterday about how while Wall Street gets richer, the regional and local banks that actually provide the day to day working capital for America's small businesses--You know, the ones that 90% of us work for--are facing a credit crunch that will prevent them from continuing that service? And where do you think the credit is jammed up at? That's right, the big guys, who are hoarding all the billions and trillions that the FED and Treasury gave them--All our money!

How can we put America back to work without a plan, Mr. Obama, and without the money to make it happen? Break up the big banks, send that money to the people who can put it to work so that America can get Back to Work!

[The Meek]

It's time to establish an underground economy folks.

[Rule Of Law]

Krugman hits another home run--but the people who need to read it most will flock like locusts to another site on Sotomayor, or Pat Buchanan--The Borg, as I now call them, who post in group think lock step.

They, we, all of us to some extent, sit comfortably with our widescreen tv, i-pods, lattes, and gas guzzling suv's while people fight and die in the streets of Iran and Honduras, among others, for the freedoms we now take for granted.

Krugman, Roubini, Brooksley Born (way back in 1998),Taibbi, and articles we've seen the last days about Goldman, and we sit and sip and watch and post. And the warning does not reach the Borg, and does not move any of us into the streets to defend our freedoms.

Four years ago Haiti had a military coup, Just as Honduras today. Clinton praised the calm and peace there last week, and forgot to mention the UN murders of hundreds of presidential supporters. Obama ignores pro-democracy movements in Honduras, now.

We need to see the actions of Goldman, Morgan, and a handful of other banks for the same threat to America, that they have been shown to be in Honduras and Haiti. And we need to see the violent removal of Democratically elected governments as dry runs for what may happen here. Their consolidation of power is awesome in its scope. And while we live our comfortable lives, they work to make us into the worlds largest Colony.

[ErnestineBass]

Good mornin', ROL!

[Rule Of Law]

And good morning to you, EB! Just reread my own post and realized that sometimes when I compose them, I know I'm writing to about 5 or 6 people,LOL!

But gawd dammmmmit, we as a nation seem to be at our worst when comfortably numb, and at our best when we're backed against the wall, scrambling around in the streets, protesting the bad, and advocating for the good. We Know who the enemy is. And yet we sit. Let me get another cup of coffee. Maybe it will was away these "preachies" I woke up with....

[Mikeeee]

I don't understand why he left out BoA, Citi, Wells Fargo and the other 8 banks that own the FED. None of them is good for America.

[Rule Of Law]

Seconded!

[jozzie]

But Goldman is particularly vile. Read Taibbi's article in Rolling Stone:

http://www.rollingstone.com/politics/story/29127316/the_great_american_bubble_machine

[jbruski]

The funny thing is the uproar that was made out of what Bernie Madoff did and how the media portrayed it as a huge relief once he was put behind bars. What he did was MAKE BELIEVE and really only a few thousand folks were hosed! These folks have lobbied hard to protect there MAKE BELIEVE financial venture and have already returned to a state of normalcy while the rest of us get screwed for years to come. Thanks Washington for protecting our interests and thanks to the media for once again focusing on nothing while something "big" has been going on all along.

[VegasWolf]

Magician's parlor trick, keep your eye on my left hand. Some things will never change.

[lemonyashes]

Tricksters, all of them! The only way to beat the trickster is by tricking them.

[itssafetosay]

I said exactly the same thing to my husband yesterday. Why is Maddoff being hauled off to jail and not these other crooks? What goldman, and others, did and are doing is market manipulation, among other things.

It's unbelievable to me and meanwhile chase pays someone to harass me daily over a $2000 credit card bill because I can't pay the minimum after my business almost closed and they jacked the rate to 38% for no reason.

I'm packing my bags.