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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

Monday, February 20, 2012

Goldman Sachs Loves Those Toxic Assets!

What a perversion of justice. First, Goldman Sachs created toxic CDOs to sell to investors who subsequently lost money. Goldman received both the fees from the sale and then bet against the mortgage market and earned billions more. The price for such unethical fraudulent actions should have been to bar Goldman Sachs from ever dealing in mortgage debt no matter what kind. Did that happen? Did the government not even think of such a penalty?

No, instead Goldman Sachs has bought $6.2 billion of the same toxic assets from the NY Fed (Goldman selling to Goldman; Goldman buying from Goldman) to use for pure speculative purposes. Or maybe Goldman will dress them up, give them a great rating and good PR and sell them to their clients.

This is what the economy looks like when it is corrupted and run by banksters. Not a pretty sight!

Why Toxic Debt Looks a Lot Less Toxic
Goldman Sachs and hedge funds are buying risky mortgages again
By Jody Shenn and Saijel Kishan - Bloomberg Businessweek

Some of the same investors who made big profits betting against mortgage bonds before the 2007 housing bust have started snapping up the toxic assets. Hedge fund manager Kyle Bass, who made $500 million when subprime debt cratered, is raising a fund to buy them. He’s joining John Paulson, who made $15 billion in 2007 thanks to the housing bust. Goldman Sachs Group has bought the bonds this year. Remarkably, so has American International Group (AIG) —the insurer that had to be rescued by the U.S. government in 2008 after its wagers on risky mortgages went bad.

These investors are jumping in as the $1.1 trillion market for mortgage bonds without government backing joins a global rally in everything from stocks and commodities to corporate loans. They are attracted to the riskiest mortgage bonds by their high potential yields. And they are speculating that the bonds’ prices have fallen so far that even continued weakness in the housing market won’t drive them down much further. “You can end up, even using severe assumptions on things such as home prices and defaults, with a very high yield based on the prices that bonds are trading at,” says Larry Penn, chief executive officer of Old Greenwich (Conn.)-based investment company Ellington Financial. “Especially with interest rates this low, if you can buy something where you can end up with a double-digit yield under severe assumptions, that’s great.”

Read the rest of the article here


JEHR said...

Whoever you are, RedHatty and others, thanks for indicating that you still feel it is important to post all the dark things that Goldman Sachs is involved in.  It keeps me going.

Darby McClintock said...

I got an Internal Revenue Service correspondence tagged CP-11, however I didn't know precisely what I was required to do with that and the reason why the Internal Revenue Service is capable of make changes in my income tax that are going to leave me having a back tax debt due. I imagined they were just simply hoping to get money out of me and even was prepared to challenge it, until eventually I found the calculation the Internal Revenue Service solved. Research your return frequently, and perhaps employ a qualified professional to look it over before you decide to attempt to challenge the IRS.  

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