Goldman Bundled Bad Debt, Bet Against It and Won

Discussion in 'Wall St. News' started by traderum, Dec 25, 2009.

  1. risky63


    stunts like this have been goin on for quite some time.
    give your clients mostly winners, then some real junk, net them a profit for the year and then they"ll stay to play.
    makes the world go round.
  2. the1


    Good article but this is old news. And what will be done about this you ask? Nothing of course. Since Goldman occupies so many offices in Washington it would be like the Government punishing themselves and even if GS didn't own the Government no one should get in the way of someone doing "God's work."
  3. Sorry, but there are no "no child left behind" rules in trading. Or, as the joker said, it's best to be ahead of the curve.
  4. sprstpd


    If Goldman disclosed the risks involved and people were still lining up to shoot themselves in the foot, then it's all fair game. Whiners who whine because of their own incompetence need to be put out of their misery.
  5. Some excerpts from an article (source below):
    The facts are not in dispute:
    1: Goldman Sachs built or manufactured a load of Collateralized Debt Obligations (CDO).
    2: Then they paid rating agencies to put their AAA seal of approval on them.
    3: Then they offered them to investors “dumber than them”

    The whole idea of buying an AAA rated security was that it was supposed to be (a) safe (b) an investment.

    I suspect they told the suckers, “look you dumb jerk, this has an AAA rating from one of the three rating agencies approved by the US Government, plus you have a warrantee from none other than Goldman Sachs who as you know does “God’s Work”, so you are privileged to even get the chance to buy this great product, and if you don’t want to buy, piss off and stop wasting my time”.

    Sounds a bit like the line Madoff used – perhaps he too was one of “God’s Workers”?
  6. sprstpd


    I'm not disputing those facts. But the responsibility also falls on the shoulders of the people who bought these contracts from Goldman Sachs to do their own due diligence. And Goldman was not the only entity that struck deals with the ratings agencies. If anything, the ratings agencies are more harmful than good and should be terminated immediately.
  7. hmmm...

    If you put a car up for sale that you know is a lemon, and pay an inspector to put a legitimate inspection sticker on it, and then sell the car, is that

    1) Good business
    2) Fraud


  8. Hmm? Then they (Goldman, Deutch...) first sell CDO (with asset of real morgage) but sell synthetic CDO TOO. That synthetic is Abacus and TABS CDO. These CDO they short too. They CREATE a bet on a bet on a bet. So the value of all this bet is so much more $value than real asset. Where can that money come from if it does not exist?
  9. And if you still think that FED, SEC etc exist to protect us then get your mind checked. This country needs a revolution to get out of this trap and these legal scam.

    Good luck trading.
    #10     Jan 1, 2010