Goldman Sachs – Masters of the Eurozone

[think]

33. Saying Sen. Levin doesn't understand financial machinations is very disingenuous.

Senator Levin understands damn well what they did.

Their sales people had emails that showed they knew the investments were toxic.

And Senator Levin called them out directly for screwing their clients.

GS hires great lawyers to make sure they don't violate the letter of the law while completely disregarding the spirit of the law.

Just as they did in Greece by helping the Greek government hide their debt so they would be qualified to join the EU and again in selling these toxic CDOs.

How Goldman secretly bet on the U.S. housing crash

By GREG GORDON - MCCLATCHY NEWSPAPERS - NOVEMBER 1, 2009

WASHINGTON — In 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers it was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting.

Goldman's sales and its clandestine wagers, completed at the brink of the housing market meltdown, enabled the nation's premier investment bank to pass most of its potential losses to others before a flood of mortgage defaults staggered the U.S. and global economies.

Only later did investors discover that what Goldman had promoted as triple-A rated investments were closer to junk.

Now, pension funds, insurance companies, labor unions and foreign financial institutions that bought those dicey mortgage securities are facing large losses, and a five-month McClatchy investigation has found that Goldman's failure to disclose that it made secret, exotic bets on an imminent housing crash may have violated securities laws.

~Snip~

McClatchy's inquiry found that Goldman Sachs:

Bought and converted into high-yield bonds tens of thousands of mortgages from subprime lenders that became the subjects of FBI investigations into whether they'd misled borrowers or exaggerated applicants' incomes to justify making hefty loans.

Used offshore tax havens to shuffle its mortgage-backed securities to institutions worldwide, including European and Asian banks, often in secret deals run through the Cayman Islands, a British territory in the Caribbean that companies use to bypass U.S. disclosure requirements.

Has dispatched lawyers across the country to repossess homes from bankrupt or financially struggling individuals, many of whom lacked sufficient credit or income but got subprime mortgages anyway because Wall Street made it easy for them to qualify.

Was buoyed last fall by key federal bailout decisions, at least two of which involved then-Treasury Secretary Henry Paulson, a former Goldman chief executive whose staff at Treasury included several other Goldman alumni.

Read more here: http://www.mcclatchydc.com/news/politics-government/article24561376.html#storylink=cpy

The Goldman E-Mails, or How to Sell Junk

By CHRIS V. NICHOLSON APRIL 28, 2010 4:33 AM

Evidence released Tuesday by Senator Carl Levin, the Michigan Democrat in charge of the Permanent Subcommittee on Investigations, includes a series of e-mail messages sent by executives at Goldman Sachs as the bank attempted to shed mortgage-related assets in the run-up to the subprime crisis of 2007.

The e-mails appear to support one of the most important criticisms of the bank — that it served itself at the expense of its clients — and illustrate the conflicts of interest that arise when banks’ proprietary trading overlaps with customer sales.

Full article:
http://dealbook.nytimes.com/2010/04/28/the-goldman-e-mails-or-how-to-sell-junk/?_r=0