Remember what the purpose of the funds were: to buffer the risks of the loans being extended by trying to even out the risk level across all borrowers. This is normal hedge fund behavior and only necessary because of government action not hedge fund manager action).
I’m mostly incensed that the government has waited until now to issue these complaints (they would have been and were just as obvious in Sep 2008 as they are now).
Ditto.
And here’s my cynical take on why this SEC action is happening now:
The Kenyan sees his polling numbers dropping like an anvil off a rooftop... so how to prop them up? He needs something that can be done without waiting for Her Highness Nancy and the Mormon Mafia’s boy Harry to act... something that the executive branch could do unilaterally....
I can almost see the wheels spinning in his Harvard-educated mind... “What to do? Oh, I know... I could enforce some laws! ...
But I need to pick on someone that everyone hates. Let’s see... child molesters. Almost everyone hates kiddie-diddlers. But there aren’t enough kiddie diddlers out there to prop up my polls numbers... and diddling little kids isn’t a federal crime, so those damned Republicans will start asking anbout jurisdiction. And then the damn courts will toss it out... no, we’ll have to find someone other than child molesters. Hmmmm.”
“OH! I know! Everyone HATES the banks. Let’s open up a can of whoop-ass on the most hated bank in the world... Goldman Sachs. “
And here we are, much later than these charges could have been issued.