Surprised no consideration here of the fact that GS has a host of other fund managers speculating that they still have massive positions to unwind. I saw that release and got much more worried about where this could lead... Wonder if goldman could possibly be in such dire straits for a market that lets them out that they're willing to put their credibility on the line. Hopefully not...but this is what they had to say on monday (before the carry trade came undone): "GEO fund is now down in the low 30% range for the year -- with all of it occuring last week. Discusses speculation around the Global Alpha and NEO funds, saying they are not unwinding Global Alpha or NEO. Says the volatility over the past few days is unprecedented, and represents opportunities. Firm notes that their Global Alpha Fund is down 27% YTD, of which more than half of that was last week..."
That Goldman has any credibility at this point is a wonder to me. That aside, I'm guessing that the last thing Goldman is worried about is its reputation. I'm guessing that without a rate cut and market turnaround, the trading operations at Goldman -- and the other big houses -- will cease, and the lawsuits that follow will take care of its remaining interests. When the dust settles, they may have to rename Goldman Sachs to Jacoby & Meyers.
Looks an awful lot like they traded what was left of it for a better price in some redemption liquidations Friday morn: Monday's report on losses came just 2 days ahead of the fund redemption request deadline for the quarter... And if I were inclined to really indulge the conspiracy theorist within, i'd take it one-step further: A certain former GS employee-turned-TV-personality just so happened to toss his credibility on the squeeze-fire that morning as well...who the hell would look for an all-time record rally on expirations? (And, come to think of it, wasn't he just all over youtube screaming at little cuty mchotness about how his dear friends are constantly asking him to use his mainstream visibility to help them out of the woodshed?) But I won't. That kind of thing only happens on tv...
In early June, GS said that there would be no rate cut in 2007, not a chance. That statement screwed up my trades badly. Just a reminder, not saying that the rate cut won't happen.
If you didn't question GS's information edge before, you should be questioning it now. The market doesn't owe anybody anything, Goldman Sachs included. RIP - Solomon Brothers
Peter Kershaw in his book "Economic Solutions" lists the ten primary stockholders in our Federal Reserve banking system: 1) Rothchild Family, London; 2) Rothchild Family, Berlin; 3) Lazard Brothers, Paris; 4) Israel Seiff, Italy; 5) Kuhn-Loeb, Germany; 6) Warburgs, Amsterdam; 7) Warburgs, Hamburg; 8) Lehman Brothers, New York; 9) Goldman & Sachs, New York; 10) Rockefeller Family, New York.