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Fraud*
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

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Tuesday, February 8, 2011

Goldman Sachs's Steven Mnuchin

Are there other ways that Goldman Sachs alumni can profit from the financial meltdown that GS helped produce by creating and selling junk derivatives? Well, there are suggestions already about speculation in the commodities market now that food prices are going up.

We learn from Bloomberg BusinessWeek about Steven Mnuchin:

"Prior to SFM, he spent 17 years at The Goldman Sachs Group, Inc. as the Chief Information Officer. Mr. Mnuchin was in this position since December 2001. While at the firm, he served as the Executive Vice President since February 2001 and was the Co-Chief Information Officer from February 2001 to December 2001. Mr. Mnuchin was a Member of the Executive Office and Co-Head of the firm's Technology Operating Committee from December 1999 to February 2001. He was responsible for overseeing mortgages, U.S. governments, money markets, and municipals in the fixed income, currency, and commodities division from December 1998 to November 1999."
Read the rest of the information here

Then there is this little tidbit below from the video:



View the video here


. . . . . . . . . . . . . . .

and from the blog isthatwacked.com (with some misspellings of the name):

How Goldman is Still Robbing the Public - isthatwacked

Here is another example of how Goldman is robbing the public.

1. IndymacBank was seized by the FDIC (Federal Deposit Insurance Corporation) in July of 2008.

2. The assets of IndymacBank was sold to a company called OneWest Bank by the FDIC.

3. Who owns OneWest Bank you ask? That is Stephen Munchin. Yes the VP of Goldman Sachs – Stephen Munchin. Also, Goldman clients George Sores and John Paulson (these two guys speak for themselves).

4. All mortgages were sold to OneWest Bank by the FDIC for $0.70 on the dollar.

5. In addition, the FDIC guaranteed to cover between 80% and 95% of the losses that OneWest Bank may experience as the result of purchasing the mortgages.

Why is this so bad for you and me? Here is where it gets scary.

6. In case of any losses by OneWest Bank, the calculations are done on the ORIGINAL MORTGAGE VALUE and not what OneWest Bank paid for the mortgage.

goldman

Image by Ingram Pinn

Here is an example:

If the original mortgage was for $300,000. OneWest Bank paid $210,000 for it ($300,000x 0.7 – $0.70 on the dollar).

If the house goes into foreclosure or a short sale situation, then the property is put on sale. Let’s say the highest bid for the house in foreclosure is $200,000.

Technically, OneWest Bank lost $10,000 ($210,000 what they actually paid for the house to the FDIC minus what the house sold for $200,000).

Does the FDIC cover between 80% – 95% of the $10,000 that OneWest Bank actually lost? NOOOOOOOO! They guaranteed to cover 80% – 95% of the losses using the ORIGINAL MORTGAGE VALUE.

In this instance, let’s say the FDIC guaranteed 90% of the losses. So using those numbers, the actual amount that the FDIC pays OneWest Bank is $90,000. That is 90% of the difference between $300,000 (the original value of the mortgage) and $200,000 (what the house sold for).

What does OneWest net out from this deal?

So OneWest Bank gets:

$200,000 from the new buyer of the house.

+ $90,000 from the FDIC.

- $210,000 (what they paid to the FDIC).

=$80,000 on a $210,000 investment. A tidy 39% return on their money.

WOW, IT IS GOOD TO HAVE FRIENDS IN HIGH PLACES.

Oh by the way, OneWest Bank may collect more as it is asking the person walking away from the house to sign promissory notes for about $50,000. They are trying to collect more money from the original home owner.

IF THIS KIND OF MONEY CAN BE MADE FROM SHORT SALES AND FORCLOSURES, WHY WOULD OneWest Bank want to modify any mortgages for the current home owners?



Read the full article here

4 COMMENTS:

Anonymous said...

They really just don't care....most of us should wake up...you have no recourse...nada!

Rich Take From Poor as U.S. Subsidy Law Funds Luxury Hotels

What’s surprising isn’t the opulent makeover: It’s how the project was financed. The work was subsidized by a federal development program intended to help poor communities.

The biggest beneficiary of taxpayer help for the Blackstone revamp was Prudential Financial Inc., the second-largest U.S. life insurer. The company got $15.6 million in tax credits from the U.S. Department of the Treasury for helping to fund the project, according to Chicago city records, Bloomberg Markets magazine reports in its March issue.

Since 2003, some of the world’s biggest financial companies, including Goldman Sachs Group Inc., U.S. Bancorp, JPMorgan Chase and Prudential, have taken advantage of a federal subsidy that will cost taxpayers $10.1 billion -- and most of the public has never heard of it.


http://tinyurl.com/4d53vd3

Joyce said...

Thank you for the link; I used it to make a posting.

Anonymous said...

Here's how Goldman Sachs makes most of its money from the stock market by logarithmic trading:

http://www.ynetnews.com/articles/0,7340,L-4015076,00.html

Joyce said...

Thank you for the link re logarithmic trading which has many interesting details.

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