SEC's Goldman charges could be just the beginning

mcclatchy ^ | 4/17/10 | Greg Gordon

[Nachum]

WASHINGTON — Goldman Sachs, whose tactics exiting the collapsing subprime mortgage market have been under government scrutiny for months, now faces federal fraud charges that it duped investors into losing $1 billion on a rigged offshore deal pegged to dicey home loans.

The suit, brought Friday by the Securities and Exchange Commission, accuses Goldman and one of its vice presidents, 31-year-old Fabrice Tourre, of allowing a Wall Street hedge fund to secretly select many of the securities in the deal.

[Nachum]

Ya think?

[Sarajevo]

What could come of this? GS could tank the markets in a fit of spiteful rage, but they're in deep with politicians.

I seriously doubt that this is anything but a measure to pacify investors by appearing that the SEC (and government) are taking some action.

[LomanBill]

>>Ya think?

 

"But ve vaz just following ze rules"....

 

 

 

"We didn't truly know the dangers of the market, because it was a dark market," says Brooksley Born, the head of an obscure federal regulatory agency -- the Commodity Futures Trading Commission [CFTC] -- who not only warned of the potential for economic meltdown in the late 1990s, but also tried to convince the country's key economic powerbrokers to take actions that could have helped avert the crisis. "They were totally opposed to it," Born says. "That puzzled me. What was it that was in this market that had to be hidden?"

http://www.pbs.org/wgbh/pages/frontline/warning/view/

 

[maddogconservative]

Goldman is powerful, but not that powerful - and if they try anything funny, even the secretaries will be doing jail time.

Many of the investors who were screwed over by Goldman (and magnetar) still have enough money to buy their own set of politicians.

Unless the GOP wises up, this will kill us in November. If the Dems are smart, they’ll be able to make it a “Tough on Crime” issue.

The smartest issue would to change investment banks and hedge funds into partnerships. Corporations make it too easy for reckless executive behavior. Partners watch the store much more carefully than shareholders.