Posted on 04/21/2010 7:09:52 PM PDT by Libloather
Is the Goldman-Sachs scandal manufactured? (updated)
Ann Kane
April 21, 2010
Reports coming in point to a scheme by President Obama to create a national scandal by having the SEC charge Goldman Sachs with fraud in order to bolster support for the sweeping financial regulatory reform bill.
An article from the Washington Examiner supports the premise that the president has always been in bed with Wall Street, even though he publicly chastises the ‘fat cats' to win approval from the American people and to ram through his overreaching financial reform. From Tim Carney:
Obama's fundraiser and economic adviser Warren Buffett is very long on Goldman, having bet on them in 2008 in the expectation of a bailout. Mark Patterson, chief of staff to Treasury Secretary Tim Geithner, was a Goldman Sachs lobbyist until months before joining Team Obama.
What does that add up to? Getting a hand in making the regulations:
Politico quoted a Goldman lobbyist Monday saying, "We're not against regulation. We're for regulation. We partner with regulators."
[snip]
Goldman can play it safe, you see, without needing a regulation. But regulations prevent smaller competitors from taking the risks needed to compete with Goldman (and every competitor is smaller).
Information uncovered by Americans for Prosperity Vice President for Policy Phil Kerpen zeroes in on a specific plot concerning the Center for Responsible Lending based in Durham, NC.
Regarding Senator Chris Dodd's pending permanent bailout legislation which creates a huge new bureaucracy called the Consumer Financial Protection Agency -- and the breaking Goldman Sachs scandal involving hedge fund Paulson & Co. run by billionaire John Paulson, AFP Vice President for Policy Phil Kerpen said:
"It looks like John Paulson made a fortune based on a scheme in which he paid the Center for Responsible Lending $15 million to shake down and harass banks into making bad loans, which Paulson then bet against with the help of Goldman Sachs.
"Now Treasury official Eric Stein, who for years worked for the Center for Responsible Lending, is expected (if the bill he helped design passes) to be installed as the head of the so-called Consumer Financial Protection Agency, a huge new bureaucracy with sweeping powers to reward CRL donors and supporters while punishing competitors who aren't in on the scheme.
Let's hope and pray that the forty-one Republican senators hold onto their convictions this week, and stop this egregious abuse from going further. No doubt, Obama and company will be making phone calls, office visits, and threats to every single one of them.
Thomas Lifson adds:
Sebastian Mallaby of the Washington Post is also suspicious: (hat tip: Ed Lasky)
Unless the SEC is sitting on more evidence than it has laid out so far, the charge sheet looks flimsy. If Goldman has become a poster child for excessive power on Wall Street, the SEC might become a poster child for government power run amok.
The SEC's 22-page complaint states that Goldman sold fancy mortgage securities without disclosing that a hedge fund manager, John Paulson, was betting that those same securities would go bad. This is a non-scandal. The securities in question, so-called synthetic collateralized debt obligations, cannot exist unless somebody is betting that they will lose value. The firms that bought Goldman's securities knew perfectly well that some other investor must be taking the opposite position. It was their job to evaluate the Goldman offer and make up their own minds.
[snip]
Next, the SEC complains that Paulson had a hand in designing the securities, maximizing the chances that they would blow up. He did the equivalent of building a timber house with a large fireplace and a blocked chimney, then buying fire insurance on the structure. Shocking though this may sound, it is another non-scandal. An investor who wants to bet against a bundle of mortgages is entitled to suggest what should go into the bundle. The buyer is equally entitled to make counter-suggestions. As the SEC's complaint states clearly, the lead buyer in this deal, a boutique called ACA that specialized in mortgage securities, did precisely that.
[snip]
The worst that can be said on the basis of the available evidence is that Goldman knew ACA was being stupid and failed to point this out. That falls far short of the offenses that the SEC alleges....
J.P. Friere of the Washington Examiner compares Enron's ties to Bush and Goldman's ties to the Obamanauts:
Campaign contributions from Goldman Sachs employees to President Obama are nearly seven times as much as President Bush received from Enron workers, according to numbers on OpenSecrets.org.
[snip]
But the mere $151,722.42 (inflation adjusted) in contributions from Enron-affiliated executives, employees, and PACs to Bush hardly add up to Obama's $1,007,370.85 (inflation adjusted) from Goldman-affiliated executives and employees. That's also not taking into account how much Goldman contributed to Obama cabinet member Hillary Clinton ($415,595.63 inflation adjusted), which was itself almost three times as much as Bush received as well.
It would be fair to say that the total amount the Obama administration has received from those affiliated with Goldman Sachs is ten times that of what Bush received from Enron.
Then there is the awkward matter of Goldman's choosing of a White House insider as its defense counsel, from Tim Carney of the Washington Examiner:
Greg Craig, Obama's first White House counsel, has joined Goldman, we learned this week. He may not have too much pull in the West Wing, which drove him out for hewing too close to Obama's campaign promises, but as a former insider he will provide valuable intelligence to the world's largest investment bank.
Rahm Emanuel, White House chief of staff, was paid $35,000 as a consultant to Goldman while also working as Bill Clinton's top fundraiser. Obama's fundraiser and economic adviser Warren Buffett is very long on Goldman, having bet on them in 2008 in the expectation of a bailout. Mark Patterson, chief of staff to Treasury Secretary Tim Geithner, was a Goldman Sachs lobbyist until months before joining Team Obama.
Yep.
Agreed!
This “scandal” is a bigger fraud than Barry himself. I guess the kiddies in Washington got tired of screwing around with Toyota and wanted something else to play with.
I don’t think Hussein is smart enough to come up with anything, and that’s the truth.
Goldman-Sachs caused the global swine flu pandemic!
From a number of sources, one of them Elliot Spitzer, the SEC’s case against G/S has little chance of success. Translation? It will be dropped in the future. It’s purpose simply being to demonize Wall St so a bill gets passed that actually protects the biggest investment houses.
His handlers are the agenda drivers
November 2010 fast approaching. Hussein Obama has to show the
“us versus them” attitude to his minions.
....{Barack Hussein Muhammad obama] has always been in bed with Wall Street, even though he publicly chastises the ‘fat cats’ to win approval from the American people and to ram through his overreaching financial reform....
YEP!!!!
It’s all about the New World Order!
You bet, orchestrated and directed by nobama’s string puller, George Soros. When George Soros speaks, the financial world listens and follows his direction.
mark
regulations only help companies like goldman. Goldman needs to be slapped with a 20 billion fine and ppl need to go to jail or all this is a white wash
Thank God we’ve got the Republican Party to stand up against Obama, Wall Street and for the American people and America’s free enterprise capitalist system. Remember Herbert Hoover said “The business of America is business.”
Perp walks! Perp walks! I want Perp walks!
And Orange jump suiits!
Barney leading the parade!
yes
For doing what specifically?
Yes
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