De tactieken van Goldman Sachs

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Op woensdag 15 juli 2009 11:58 schreef Perrin het volgende:
What Is Goldman Sachs?

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Op woensdag 15 juli 2009 12:02 schreef Drive-r het volgende:

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Zoals in het andere topic: je vergelijkt 4 banken met een grote consumer kant met 1 bank die geen consumer kant heeft. Dat verdraait de cijfers nogal, helaas. Daarbij zou ik sowieso in een vergelijking eerder HSBC vervangen door Morgan Stanley en historisch ook Lehman en Merill Lynch eigenlijk willen zien.

Het is jammer dat ze in deze grafieken nooit de moeite nemen om de "vergelijkbare" delen uit deze 4 banken te lichten (die data is gewoon beschikbaar) en die vervolgens te vergelijken met Goldman, zou een beter beeld geven en dan kan je echt zien wat ze anders doen. Nu is het appels en peren.

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Op woensdag 15 juli 2009 13:23 schreef Perrin het volgende:

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Dat is zo'n beetje ook het punt van dit artikel, GS heeft een banklicentie (en kan dus goedkoop geld regelen dat wordt gedekt door de belastingbetaler) terwijl het meer een soort hedgefonds is dat geld verdient met (dubieuze?) beurstransacties. Sterker nog, op sommige dagen doen Goldman Sachs computers het merendeel van de transacties op de NYSE.

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Meanwhile, Goldman is still depending on $28 billion in outstanding debt issued cheaply with the backing of the Federal Deposit Insurance Corporation. Which means you and I are still indirectly funding Goldman's high-risk operations.

Goldman is skillful at playing the market. Now that most of its major competitors are out of the action or still under the strict control of the Treasury and the Fed, it has the market mostly to itself. Expect the others to jump back in to high-risk deals as soon as they can. But Goldman is also skillful at playing politics -- something its rivals aren't nearly as good at. Recall that last fall, at a closed meeting between Treasury Secretary Hank Paulson (formerly Goldman's CEO), Tim Geithner (then at the New York Fed), and a handful of others to decide on the fate of giant insurer AIG, Goldman's cheif executive, Lloyd Blankfein, was at the table. The decision to bail out AIG resulted in a $13 billion giveaway to Goldman because Goldman was an AIG counterparty. Indeed, Goldman executives and alumni have played crucial roles in guiding the Wall Street bailout from the start.

So the fact that Goldman has reverted to its old ways in the market suggests it has every reason to believe it can revert to its old ways in politics, should its market strategies backfire once again -- leaving the rest of us once again to pick up the pieces.

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Op woensdag 15 juli 2009 11:58 schreef Perrin het volgende:
What Is Goldman Sachs?

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Okay, This Time Matt Taibbi Nails Goldman And The Bailout

Goldman will surely deny that its risk-taking is subsidized by the taxpayer -- but then so did Fannie Mae and Freddie Mac, right up to the bitter end. An implicit government guarantee is only free until it's not, and when the bill comes due it tends to be huge. So for the moment, Goldman Sachs -- or should we say Goldie Mac? -- enjoys the best of both worlds: outsize profits for its traders and shareholders and a taxpayer backstop should anything go wrong.”

“So what’s wrong with Goldman posting $3.44 billion in second-quarter profits, what’s wrong with the company so far earmarking $11.4 billion in compensation for its employees? What’s wrong is that this is not free-market earnings but an almost pure state subsidy.”

Pop quiz: which one of the above quotes comes from Rolling Stone’s Matt Taibbi and which comes from the editorial page at the Wall Street Journal.

We’ll get to the answer in a bit. What fascinating is that it’s so hard to tell which is the long-standing voice of capitalism and which is the writer for the one time icon of the counter-culture. To put it differently: what could have brought us to the point where both are aiming their scornful analysis at the most successful firm on Wall Street?

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Shattering the Right vs. Left Prism Once Again: The Wall Street Journal Goes After Goldman and the Bank Bailout
Yesterday's opinion section of the Wall Street Journal offered convincing proof that those who want a progressive financial policy and those who simply want to save capitalism are in agreement about the madness of the administration's Wall Street policies.

There, on the editorial page of the capitalist Bible, was a piece taking repeated shots at Wall Street darling Goldman Sachs. And, over on the opposite page, a two-fisted op-ed by former hedge-fund manager Andy Kessler in which he labels the government bailout of Wall Street "a dumb move" and "a bust."

I'm planning to shrink down today's Journal, laminate it, and hand it out anytime someone in the media starts analyzing the economy using the cobweb-covered, tried-and-untrue right vs. left framing.

You know that this way of looking at financial policy is dead and buried when Rupert Murdoch's pride and joy is publishing takes that I could happily have written myself.

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Paul Krugman: The Joy of Sachs
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?

First, it tells us that Goldman is very good at what it does. Unfortunately, what it does is bad for America.

Second, it shows that Wall Street’s bad habits — above all, the system of compensation that helped cause the financial crisis — have not gone away.

Third, it shows that by rescuing the financial system without reforming it, Washington has ... made another crisis more likely.

Let’s start by talking about how Goldman makes money.

Goldman, famously, made a lot of money selling securities backed by subprime mortgages — then made a lot more money by selling mortgage-backed securities short, just before their value crashed. All of this was perfectly legal, but the net effect was that Goldman made profits by playing the rest of us for suckers. And Wall Streeters have every incentive to keep playing that kind of game.

The huge bonuses Goldman will soon hand out show that financial-industry highfliers are still operating under a system of heads they win, tails other people lose. ... You have every reason, then, to steer investors into taking risks they don’t understand.

And the events of the past year have skewed those incentives even more, by putting taxpayers as well as investors on the hook if things go wrong. ... Wall Street in general, Goldman very much included, benefited hugely from the government’s provision of a financial backstop — an assurance that it will rescue major financial players whenever things go wrong.

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Goldman is self-interested, which means they don't share all their ideas, and they don't hire everyone capable who wants a job there, but that's inevitable and you can't let that color your views. The latest hatchet job in Rolling Stone is by Matt Tiabbi, who has a profoundly adolescent and paranoid world-view that seems clever and witty only at a distance. Those who think Goldman was the prime mover in our financial mess are simply wrong, as Goldman was as guilty as everyone who did not second-guess the assumption that aggregate housing prices do not fall in nominal terms (academics, legislators, regulators, investors, home buyers, investment bankers, rating agencies—did I forget anyone?).

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Op vrijdag 17 juli 2009 14:19 schreef macondo het volgende:

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Bron: http://falkenblog.blogspot.com/2009/07/is-goldman-evil.html

Aanrader trouwens.

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Goldman blew itself up last year. They blew up. The stock should be zero, their businesses should have been auctioned off and they should have gone the way of Bear and Lehman. They didn't, because the Feds carved out exception after exception for them, handing them free money, and backstopping their losses. This amounted to a deal which resembles the following: go ahead and keep all of your past profits and almost all of your future profits, and we'll make sure your losses are borne by everyone.

Why otherwise intelligent people aren't outraged as they churn out $1 billion in profits a month with an implicit government backstop (which their trading partners, clients, and counterparties love) boggles my mind.

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How anyone can defend GS is beyond my comprehension, and Taibbi is spot on.

Seriously, tell me what these people "make"? What do they bring to the economy? Nothing.

They have huge pools of money that they shift around and around in a financial slight of hand that bilks the world economy.

They inflate speculative bubbles all over the place in stocks, commodities, basically any market anywhere that they can leverage control over through money, government, whatever.

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Simply calling the Taibbi article a "hatchet job" doesn't make it one. Why don't you try actually refuting the points in the article? Additionally, you've only attempted (and rather half-assedly at that) to refute one, relating the housing bubble. But "academics" didn't securitize 7% of the loans that led to the crisis, did they?

It wouldn't bother me either if they were making money out of their profits. Except the didn't. If it wasn't for the direct capital infusion from .gov (and the over the weekend conversion to a bank holding company giving them access to .gov guarantees and loans) and the back door capital infusion from .gov via AIG, they were done. Bankrupt. Out on their asses like the employees at a Pontiac dealership.

So lets not pretend they make their money purely out of their smarts and are entitled to it.

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Op vrijdag 17 juli 2009 14:46 schreef Perrin het volgende:

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Heb je de reacties onderaan zijn artikel ook gelezen?

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Op vrijdag 17 juli 2009 15:13 schreef macondo het volgende:

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Anonieme reacties zijn niet van het kaliber van Falkenstein. Aluhoedjes heb je immers overal. Ook op hier trouwens, en mogen ze nog nieuws posten ook..

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Op vrijdag 17 juli 2009 15:43 schreef Perrin het volgende:

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En wat in het bijzonder vind je zo sterk aan zijn artikel? Weinig feiten en veel "GS is gewoon top!".

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Op vrijdag 17 juli 2009 15:43 schreef Perrin het volgende:

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En wat in het bijzonder vind je zo sterk aan zijn artikel? Weinig feiten en veel "GS is gewoon top!".

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Op vrijdag 17 juli 2009 15:43 schreef Perrin het volgende:

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En wat in het bijzonder vind je zo sterk aan zijn artikel? Weinig feiten en veel "GS is gewoon top!".

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Op vrijdag 17 juli 2009 16:15 schreef Drive-r het volgende:

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Voor de duidelijkheid: Goldman is ook top. In mijn ervaring de beste bank. Simpelweg een money-making-machine.

Kwestie van 'Don't blame the player, blame the game'.

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Op vrijdag 17 juli 2009 16:33 schreef macondo het volgende:
David (Drive-r) en ik (Samuel) zijn naast zelf werkzaam in de sector, natuurlijk ook van joodse afkomst. Dan ben je snel geneigd sympathie op te vatten voor Goldman Sachs natuurlijk...

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Op vrijdag 17 juli 2009 16:37 schreef Perrin het volgende:

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Want bij Goldman Sachs werken alleen mensen van joodse afkomst? En wat heeft afkomst nu te maken met of iets afkeurenswaardig is of niet? Als een kennis van je in een dronken bui iemand zonder reden helemaal dood mept, kies je zijn kant toch ook niet?

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Op vrijdag 17 juli 2009 16:37 schreef Perrin het volgende:

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Want bij Goldman Sachs werken alleen mensen van joodse afkomst? En wat heeft afkomst nu te maken met of iets afkeurenswaardig is of niet? Als een kennis van je in een dronken bui iemand zonder reden helemaal dood mept, kies je zijn kant toch ook niet?

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Op vrijdag 17 juli 2009 16:43 schreef macondo het volgende:

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Goldman Sachs is het Ajax van de bankensector, het zijn de superjoden. Dacht dat zoiets toch wel bekend was.

Google anders eens op "zionistisch complot" in combinatie met Goldman.

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Op vrijdag 17 juli 2009 16:45 schreef Drive-r het volgende:

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Je misvat zijn opmerking, het was sarcastisch omdat veel van de commentaren op Goldman vaak ook eindigen in een anti-Joodse tirade. Daarbij ben ik ook niet Joods, mocht dat helpen.

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Op vrijdag 17 juli 2009 16:25 schreef Perrin het volgende:

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Heads they win, tails I lose. Tijd om dit spel te stoppen.

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Op vrijdag 17 juli 2009 16:46 schreef Perrin het volgende:

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Nah, ik vind het gedrag van Goldman in combinatie met de VS regering al ruimschoots voldoende. En zo te zien breekt het nu ook een beetje in de mainstream door in de VS. Een kat in het nauw maakt soms rare sprongen..

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Op vrijdag 17 juli 2009 16:50 schreef Drive-r het volgende:

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Nogmaals, welk gedrag? Waarom is het alleen Goldman? Heb je ooit gekeken bij welke andere banken de beleidsbepalers in de US vroeger gewerkt hebben? Of welke advocaten kantoren, oliemaatschappijen, enz?

Waarschijnlijk niet. Maar iemand voert je een lijst Goldman namen en je schreeuwt moord en brand. Niemand klaagde toen het goed ging, terwijl het toen ook groot nieuws was toen Paulson zijn job nam. Mensen vonden het zelfs goed dat iemand met zoveel kennis die rol wilde nemen.

Nu klagen

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Op vrijdag 17 juli 2009 16:58 schreef Perrin het volgende:

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Tja.. bij laag water zie je wie er geen zwembroek draagt.

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Op vrijdag 17 juli 2009 17:01 schreef Drive-r het volgende:

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Wat een waardeloze opmerking, zeg dan iets zinnigs. Wat zie je nu dan? Wat heeft Paulson exact gedaan?

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The real price of Goldman’s giganto-profits

So what’s wrong with Goldman posting $3.44 billion in second-quarter profits, what’s wrong with the company so far earmarking $11.4 billion in compensation for its employees? What’s wrong is that this is not free-market earnings but an almost pure state subsidy.

Last year, when Hank Paulson told us all that the planet would explode if we didn’t fork over a gazillion dollars to Wall Street immediately, the entire rationale not only for TARP but for the whole galaxy of lesser-known state crutches and safety nets quietly ushered in later on was that Wall Street, once rescued, would pump money back into the economy, create jobs, and initiate a widespread recovery. This, we were told, was the reason we needed to pilfer massive amounts of middle-class tax revenue and hand it over to the same guys who had just blown up the financial world. We’d save their asses, they’d save ours. That was the deal.

It turned out not to happen that way. We constructed this massive bailout infrastructure, and instead of pumping that free money back into the economy, the banks instead simply hoarded it and ate it on the spot, converting it into bonuses. So what does this Goldman profit number mean? This is the final evidence that the bailouts were a political decision to use the power of the state to redirect society’s resources upward, on a grand scale. It was a selective rescue of a small group of chortling jerks who must be laughing all the way to the Hamptons every weekend about how they fleeced all of us at the very moment the game should have been up for all of them.

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Op vrijdag 17 juli 2009 17:19 schreef Perrin het volgende:

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Daarmee bedoel ik dat veel amorele handelspraktijken in slechte tijden boven komen drijven en zichtbaar worden (denk aan Madoff).
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Op vrijdag 17 juli 2009 17:23 schreef Drive-r het volgende:
Je opmerking over Madoff geeft al aan dat je enig inzicht mist. Er is een verschil tussen iets dat amoreel is (subjectief) en iets dat illegaal is (objectief vast te stellen).

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Op vrijdag 17 juli 2009 16:43 schreef macondo het volgende:

Google anders eens op "zionistisch complot" in combinatie met Goldman.

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Op vrijdag 17 juli 2009 17:30 schreef Perrin het volgende:

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Jouw opmerking geeft aan dat je het inzicht mist dat zelfs wanneer je je legaal hebt ingedekt, je een probleem hebt als iedereen je als amoreel ziet.

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Zeker als grote groepen mensen hun spaarcenten, baan en huis verliezen terwijl jouw organisatie als een soort economische parasiet geld heeft verdiend en blijft verdienen over de rug van deze mensen.

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Op vrijdag 17 juli 2009 17:44 schreef Drive-r het volgende:

Nogmaals, ik heb al tig keren gezegd dat ik het daar niet mee eens ben en dus ben ik het eens met je stelling dat dit amoreel is. Je bent het spoor een beetje bijster, me dunkt.

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Let’s start by talking about how Goldman makes money.

Over the past generation — ever since the banking deregulation of the Reagan years — the U.S. economy has been “financialized.” The business of moving money around, of slicing, dicing and repackaging financial claims, has soared...

Such growth would be fine if financialization really delivered on its promises — if financial firms made money by directing capital to its most productive uses, by developing innovative ways to spread and reduce risk. But can anyone, at this point, make those claims with a straight face? ...

Goldman’s role in the financialization of America was similar to that of other players, except for one thing: Goldman didn’t believe its own hype. ... Goldman, famously, made a lot of money selling securities backed by subprime mortgages — then made a lot more money by selling mortgage-backed securities short, just before their value crashed. All of this was perfectly legal, but the net effect was that Goldman made profits by playing the rest of us for suckers.

And Wall Streeters have every incentive to keep playing that kind of game.

The huge bonuses Goldman will soon hand out show that financial-industry highfliers are still operating under a system of heads they win, tails other people lose. ... You have every reason, then, to steer investors into taking risks they don’t understand.

And the events of the past year have skewed those incentives even more, by putting taxpayers as well as investors on the hook if things go wrong. ... Wall Street in general, Goldman very much included, benefited hugely from the government’s provision of a financial backstop — an assurance that it will rescue major financial players whenever things go wrong.

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Goldman Sachs' Financial Boom: A Political Mess for Obama? - TIME

The good news for traders has created two distinct concerns for President Obama's advisers. The first problem is political. For much of the year, populist revulsion at Wall Street greed has been palpable. Obama, who prides himself on his cool countenance, has repeatedly channeled this fury, flashing anger and frustration at the logic of financial titans, who continued to justify huge paydays even as their banks begged financial lifelines from the U.S. taxpayer. "That is the height of irresponsibility," the President said in January, after a report emerged of large 2008 bonuses on Wall Street. "It is shameful."

But the President has thus far resisted calls for a heavy government hand in limiting financial paydays, aside from certain limits on senior executives at firms that have not paid back some taxpayer funds and a number of proposals for regulators to develop new ways of better tying compensation to long-term risks. That leaves the White House vulnerable in the coming months. If Wall Street decides to cash in on its recent winnings despite the public rhetoric of the Administration, the contrast with the nation's still growing unemployment rate couldn't be starker. "It's just got to feel wrong to a lot of people," says Douglas Elliott, a fellow at the Brookings Institution, speaking of the Goldman compensation announcement. "It seems to me a political mistake."