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According to the Collins English Dictionary 10th Edition fraud can be defined as: "deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage".[1] In the broadest sense, a fraud is an intentional deception made for personal gain or to damage another individual; the related adjective is fraudulent. The specific legal definition varies by legal jurisdiction. Fraud is a crime, and also a civil law violation. Defrauding people or entities of money or valuables is a common purpose of fraud, but there have also been fraudulent "discoveries", e.g. in science, to gain prestige rather than immediate monetary gain
*As defined in Wikipedia

Thursday, February 10, 2011

Goldman Sachs: Self-satisfied and Self-righteous

Eliot Spitzer's interview of Michael Lewis on CNN was all about where the banks, including Goldman Sachs, are today. Unfortunately, the following CNN video with Spitzer's interview is quite a bit shorter than it was on the TV, so I have paraphrased the other information below.

According to Lewis, bankers haven't learned anything except that they can do whatever they want to because the financial system is not properly regulated yet. The banks, like Goldman Sachs, get to keep the money they make and the bailout money when they make risky decisions and fail. Goldman Sachs has been complicit in the largest transfer of wealth from taxpayers to the richest people in the country.

If the capital requirements for banks and the Volcker rule are enforced properly, then there should be less risk and less volatility in earnings for banks, and there should be no bailouts for losses. In the past, says Lewis, the taxpayer, for all intents and purposes, has been backing hedge funds.

The FCIC holds no one accountable in its report even though it presents damning evidence of malfeasance although no one is caught doing anything criminal. What is scandalous is what is considered "legal." The underwriting standards of banks like Goldman Sachs were horrible. According to Lewis, the surface of what was done is just being scratched; the banks did not co-operate fully. What we are left with is a bunch of self-justified and self-rightous bankers who are proud of the huge amounts of money (and status) they have attained.

Bernanke and Geithner have dirty hands and because of their actions the financial system cannot be reformed properley: the banks have been subsidized back to health rather than reformed.

See the video here


Anonymous said...



Anonymous said...

Basically he's saying all our players were in place and I knew the outcome before it began...even though it was a destructive policy....he fails to mention his, at the time , underwater positions in all things financial.

Billionaire Warren Buffett said his $5 billion investment in Goldman Sachs Group Inc. at the depths of the financial crisis was a wager that Federal Reserve Chairman Ben S. Bernanke and then-Treasury Department Secretary Henry Paulson would take on debt to prop up the economy.

Buffett: Goldman Buy Was Bet U.S. Would `Leverage Up'

“It was a bet essentially on the fact that the government would not really shirk its responsibility at a time like that to leverage up at a time when the rest of the world was trying to deleverage,” Buffett said in an interview released today by the Financial Crisis Inquiry Commission.

Anonymous said...

Isn't this part of the problem...instead of the solution....kind of genius...I'm here to protect YOU but not really!

(sorry about his wife,though)

DealBook Portraits: Gary Gensler

Gary Gensler, Commodity Futures Trading Commission chairman, left Goldman Sachs after 18 years to join government. He is now a key figure in the Obama administration's efforts to regulate Wall Street.

Joyce said...

Anonymous, I know all about Gary Gensler. He is a nice chap and has a lovely family and does all the right things privately, I suppose. When he says that he is in public service where everything is "exposed and transparent" I wonder if that includes HIS de-regulatory past and his obvious loyalties to Goldman Sachs. His past actions make it difficult to believe that he really has the interests of the public at heart. He certainly didn't before he got the post as head of CFTC.

Maybe it is time to update his biography now that he is fighting so hard (sarcastic) for regulation of derivatives by creating the new rules under Dodd-Frank reform. I'm dubious.


Anonymous said...

@Joyce from what I read as head of the cftc his investigatory prowess seems inhibited..

read the comments and links..

Andrew Maguire Bombshell Information: Max Keiser on AJ Show

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