Wednesday, April 1, 2009

Goldman Sachs Projected to Have Every Dollar by 2016

Treasury's solution to the gridlock caused by deregulation of the giant financial companies is to let the giant financial companies write the new rules. The Obama Administration met with the CEOs of the biggest banks and brokerage houses (Goldman Sachs and his best buddies) to come up with a plan to create a fluid market for the CDOs that are weighing down our banks' balance sheets. Conveniently for the biggest brokerage houses, the way to get that deep, transparent market is to have Goldman and 3 or 4 other thieves make the market for those assets. We were told that private money would have a chance to trade this boondoggle. That's true as long as you already have at least $10 BILLION worth of shitty CDOs already on your books. Otherwise, you can find someone who does to manage your money for the low, low rate of 2% plus 20% of the profits. Of course, there are only a handful of firms that meet this counter-intuitive requirement of being qualified to appraise what is shit because they are knee deep in shit. Surprise! One of those is Goldman Sachs. Even the WSJ is pissed off about it. I personally know of at least 2 qualified traders/ assayers-of-risk who were beating the drums to create a fund to trade these distressed assets. Having thousands of these funds participating would guarantee that the taxpayer get the best price possible. Unfortunately, they haven't proven they're qualified by blowing up the planet's banking system. Instead, we'll just have to trust G.S. and friends not to collude. To quote Merryl Streep as that nun, "I have doubt, so much doubt."