The Goldman-Sachs Madness

Evidently, today the worst of government wrath  fanned by populism, is saved for any American financial corporation with a profitable quarter.

Americans concerned for the integrity and sanity of this Congress and the Administration in financial affairs should consider the following:

- The SEC voted by a margin of 3-2 to commence the lawsuit against Goldman-Sachs; and skirted its customary litigation avoiding settlement negotiations.  The Commission was divided by a minimal margin to sue Goldman-Sachs; likely  based on partisan choice.

- Congress has no intention of applying disclosure rules/reforms of any meaning to the securities markets –whether for options trading or derivatives, while maintaining the option of short-selling (even the President has done short-selling in his short-term private funds management and could care less when hedging his and others monies about market stabilities – he and most like minded members of Congress are not ethical heroes on this point).

- The  market economy which we enjoy, through educated risk undertaking and greater variable prediction & use, make possible the expanded use of money & asset expansi0n which most Americans now prefer; coupled with the best protections of the 1930’2 Glass-Steagall protections.  This market approach, with less regulation is founded on smarter money and smarter investors. (Most of us who would participate are more angel than expected).

-Due to public and private investor expectations, modern markets can perform, with sudden/sever impact limitations; and are preferable  (to Americans anyway) to severe interest rates or taxation and forced savings directives.  Analysts predict a massive fall in today’s market gains (Dow nearing 11000 again after the injuring event of  the last year and a half) should derivatives be aggressively stayed or disclosed; also short sales and other hedge instruments  - via withdrawn hedge fund participation  - as instantly as they can as before 2010. (private news sources)

- Derivatives – particularly the now celebrated swap agreements are investment hedging instruments and as such were to be barred from the disclosure now sought by Congress.  In effect – material disclosure can make the law’s enablement of them pointless & the instruments function as a hedging useless.   The law, bipartisan,  (Gramm-Leach-Bliley Act) was passed for President Clinton’s signature in 1999.  A key segment follows:

… (b) Security-based swap agreements
(1) The definition of "security" in section 78c(a)(10) of this
title does not include any security-based swap agreement (as
defined in section 206B of the Gramm-Leach-Bliley Act).
(2) The Commission is prohibited from registering, or requiring,
recommending, or suggesting, the registration under this chapter of
any security-based swap agreement (as defined in section 206B of
the Gramm-Leach-Bliley Act). If the Commission becomes aware that a
registrant has filed a registration application with respect to
such a swap agreement, the Commission shall promptly so notify the
registrant. Any such registration with respect to such a swap
agreement shall be void and of no force or effect. …

- Deception based on allegations must be proved in a court of law; or similar administrative law courts hearings for fact-finding.  Goldman-Sachs serves hedging & investment asset management  instruments to educated institutional investors with capacities in independent  analysis.  They expand money & make money.  What is wrong with any American investment firm hdeging against its own bets and market calculations?  That is the investment business – banks lend t cross-competitors daily – conflict of interest? deception?

- Goldman-Sachs is getting a raw deal for predicting the ned of the housing boom – any cyclic adjustment was inevitable.  What deception occurred with three years predictions that USA housing housing booms were about to crunch?  An investment house is supposed to have those capacities & numbers for itself & clients.  (American Morning CNN April 27 2010)

-Americans are disappointed that investment houses create and consume the same instruments which they and their fellow investors buy.  Excuse the oxymoron here in this service – is their any honesty?  Too much service?

-This blogger can see nothing but anti-trust disclosure of a classified DOJ nature saving the matter (it would have stripped AIG in an earlier time); a more transparent Federal Reserve which would defeat modern fiscal policy however, and is not preferred; and plenty of liquidity with derivatives learned.  Fraud is fraud – police it, and primarily with the laws self-interested motivations and returns; instead of the government- (save when it is a client).

http://codes.lp.findlaw.com/uscode/15/2B/78c-1

http://en.wikipedia.org/wiki/Gramm-Leach-Bliley_Act

http://www2.goldmansachs.com/

http://www.sec.gov