CODEPINK Shames Goldman Sachs On “Shitty Deals”

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Tue, Apr 27, 2010

Accountability, Bailouts

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Goldman Sachs is going down.


CODEPINK made the front page of the New York Times, holding placards during a Senate Committee on Homeland Security and Governmental Affairs hearing on Capitol Hill, where senators grilled financial behemoth Goldman Sachs for lying and defrauding clients in “shitty deals.”

(Check out more photos here)

The Securities and Exchange Commission has filed a civil action against Goldman Sachs for allegedly selling investment packages that were designed to fail, betting against its own clients. Basically, Goldman created mortgage investments without informing buyers they had been put together with help from a hedge fund client, Paulson & Co, that was betting on the investments to fail.

Newly released company emails also show that Goldman Sachs executives boasted about the money the bank was making while the US housing market was collapsing in 2007. Talk about having no shame.

“They’re buying something from you, and you are betting against it. And you want people to trust you? I wouldn’t trust you,” Senator Levin said pointedly to the CEO of Goldman Sachs, Llyod Blankfein.

Senator Levin also made the hearing quite amusing by using the word “shitty” 11 times in questioning Dan Sparks, the former head of Goldman’s mortgage department, on how long they had knowingly given “shitty deals” to their clients. Sparks only had non-answers:

Senator McCain also drew some kudos for stating that, “I don’t know if Goldman has done anything illegal,” but “there’s no doubt their behavior was unethical, and the American people will render a judgment.” The American people have made a judgment: Main Street does not trust Wall Street and Goldman Sachs will have to negotiate a settlement. What we really want though is for Congress to break them up.

In the meanwhile, someone tell Goldman Sachs to sit down, stop arguing and take whatever “slap on the wrist” given to them because the longer they stay in the limelight, the more their shares would fall on the market.

And instead of the civil trial they are facing right now, they might embolden more Congressional members to sign on for a criminal case against them. Indeed, the number has doubled from 18 to 44 members of Congress after the hearings today.

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  • http://jasminepw.blogspot.com Jasmine

    Congratulations on making the front page. And thank you for all that you’re doing!

  • Robert Pike

    Bailout bill debates aside, immediate congressional action is necessary to inhibit another financial real property bubble in the future. These actions must include rescinding both the Gramm-Leach-Bliley and Commodity Futures Modernization Acts of 1999 and 2000. Congress should then readopt the 1933 Glass-Stegall Act. Those actions would ring fence financial institutions from engaging in this greed driven activity in out years, nipping their RICO ACT conduct in the bud.

    Next, all existing sub prime mortgages and trust deeds created and securitized on both residential and commercial real properties since 2000 should be converted to the current thirty year fixed interest rate after the properties is appraised. The new note should reflect the current mark to market value of the property as of the date of the new appraisal.

    These actions will require much legislative vetting and in the process of the hearings reveal the real whiners in the country. They will however, if carried out, relieve taxpayers from being saddled with more massive future debt, precipitated by faulty financial math models, fraud, and racketeering by members of the greedy banking industry. The current conduct responsible for this meltdown was conjured up by folks cast from the Ivan Bosky & Michael Milkin molds whose junk bond schemes were responsible for the domestic financial meltdown of the late 1980′s and early 1990′s.

    While Commercial and Investment Banks, private and public pension funds, insurance companies such as AIG and wealthy individuals will suffer huge losses, they must accept and be held accountable for the reality that investing in these craftily created securities, Derivatives and Credit Default Swaps was and is gambling. Investing in those instruments is no different than tossing down a bet at gambling table in Central City, Colorado. Customers slamming back a shot of whiskey at a Buffalo bar while checking out the local scenery should not be billed for the bad bet by the bumpkins at the blackjack table.

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