Goldman Sachs Round Up

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As I mentioned in class, as the Senate Hearings continue this week is producing a range of opinions.

David Brooks, a conservative columnist for the NewYork Times, sees a typical story of dumb politicians:

First, as is traditional in our culture, the elected leaders of the clueless establishment have summoned the leaders of Goldman Sachs to a hearing so they can have a post-hoc televised conniption fit on the amorality of Wall Street.

Paul Krugman, now considered  a progressive, but I am old enough to remember him being disliked by the left for arguing for free trade back in the 1990s, is reliably more focused on economics in “Looters in Loafers.”

We’ve known for some time that Goldman Sachs and other firms marketed mortgage-backed securities even as they sought to make profits by betting that such securities would plunge in value. This practice, however, while arguably reprehensible, wasn’t illegal. But now the S.E.C. is charging that Goldman created and marketed securities that were deliberately designed to fail, so that an important client could make money off that failure. That’s what I would call looting.

Part of his article relies on the investigative reporting of ProPublica on Magnetar, a hedge fund that modeled much of what Goldman Sachs is accused by the SEC of doing, as presented in this podcast: Inside Job.

For a more comprehensive overview, here is our friend Bethany McLean (here on the Daily show) (of the Smartest Guys in the Room) on the Goldman Sachs story:

That is, there are no good guys here. It’s dishonest and ultimately dangerous to pretend that Goldman is the only bad actor. And the worst actor of all is the one leading the charge against Goldman: our government.

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