bobbyw24
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http://seekingalpha.com/article/149574-forget-goldman-start-worrying-about-the-government
Forget Goldman, Start Worrying About the Government
Look, everyone and his brother are jumping on the “Goldman is evil” bandwagon these days. Even Rupert Murdoch’s Wall Street Journal is talking about Goldman Sachs like they are “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.” Well, I’m not. I’ve got news for you: you’re barking up the wrong tree.
It’s the U.S. government we should be pointing fingers at. While Goldman (GS) is crying out thank you sir, may I have another as everyone piles on, the U.S. government, which often seems bought and paid for by Wall Street and is the one actually running things here, is getting off scot-free.
Here’s a question for you, if Goldman made out like bandits from the AIG fiasco, who do you think allowed that? Government.
When Goldman’s Lloyd Blankfein was the only person in the room from Wall Street as AIG’s fate was debated, who do you think allowed him? Government.
When TARP funds were disbursed to re-capitalize Goldman and other banks, who made that decision? Government.
When Goldman repaid its TARP funds, paving the way for them to then hand out record bonuses, who do you think allowed this? Government.
When Goldman sold asset-backed securities to investors when it was net short the mortgage-backed market, whose rules do you think allowed this? Government.
Forget about Goldman Sachs. Start worrying about government.
They are the ones who regulate the financial services industry. Government is the one which makes laws governing how financial services companies can and cannot operate. Government is also the one which can change the ground rules going forward to help prevent a recurrence of this sort of financial crisis in future.
As my good friend Marshall Auerback says, the advantages firms like Goldman have are “symptomatic of the problem, but they are not the problem.” The problem is Government and its cozy relationship with the industry it is suppose to regulate and control. The government is captured by the financial services industry, plain and simple. This is why the global financial system is a shambles. The question is: what are you going to do about it?
It seems like the only thing most people are going to do is sit around and whine about Goldman and big banks making a shed load of cash. Then, they’ll get all riled up and angry at Goldman and the rest of Wall Street and try and tax these people to level the playing field. Doesn’t sound like a very comprehensive solution to me.
How about this: stop elections in America from being controlled by money. We can eliminate private funding of the electoral process. Of course, Barack Obama wouldn’t be so happy about this since he owes his election to private funding. And free market zealots will be shouting down this proposal from the word go. But so what? Isn’t it obvious that money drives the political process in the United Sates? Do you have any better ideas?
Here’s another one: let’s get rid of Political Action Committees (PACs) too. Aren’t these just vehicles through which big money can be channelled into supporting one candidate over another. You might want to have a look at the Top All-Time Donors list to see what I mean. By the way, for you Goldman-haters, GS is in 4th place with $30 million donated, right behind our friends at the National Association of Realtors.
And, let’s round out my trifecta of suggestions with a ban on a bunch of lobbying activities. If it were up to me, I’d ban activities like this and this. Why should lobbyists, who usually represent corporate interests, get a seat at the table when you and I don’t? Sure, there are consumer lobbyist groups like the AARP too, but I would restrict their contacts to government as well. And employees of big business should be barred from moving directly from an interested company/law firm to a regulatory.government role and vice versa. They are like lobbyists who are actually inside government: interested parties who will not be able to take arms' length decisions.
So, yes, Goldman is living high on the hog. But the last time I checked, it was Congress and the President who are actually supposed to be looking out for our interests in this representative democracy. Right now, our legislative and executive branches are filled with people who are incentivized to look after the interests of big business and NOT after the interests of individual Americans.
If you want change we can believe in, start focusing in on the right people: Congress and the President.
Related Articles
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* Citibank's Problems Are Far from Over Quick Read Jul 19, 2009
* TALF on the Decline Quick Read Jul 19, 2009
* No Jolt From General Electric - Barron's Quick Read Jul 19, 2009
* Investors Can Bank on Banco Santander - Barron's Quick Read Jul 19, 2009
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o John Lounsbury:
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Edward - - -
You are so right in this article. I do not intend that you take this as an insult, but you are just stating the obvious. What I like about the obvious in this article, though, is that you you present it with saber precision and sledgehammer impact. Well done.
I am reminded of the sound bite from Senator Dick Durbin (D, Illinois) earlier this year, referring to Capitol Hill: "This place is bought and paid for." I would offer another thought: Change the name from "Capitol Hill" to "Capital Hill". After all, isn't that where capital has been invested by the rich and powerful?
Jul 19 02:06 AM | Link | Reply
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o Sober Realist:
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With numerous GS alumni in key government positions, GS has essentially become part of the government. You can refer to the government as a "GSOE" - Goldman Sachs Owned Enterprise. So both GS and the government are equally deserving of the public's wrath. GS, as well as politicians corrupted by campaign contributions, have no moral imperative to protect the well-being of this country and its citizens. Market Sniper summed up the situation best:
"The hubris of Goldman Sacks is breath taking. They no longer even deny it. They are the broker for the Fed and the PPT. They front run the PPT trades. Their server is parked right next to the execution server so they can almost at will, front run large block trades. Their people have been installed at strategic economic and political choke points throughout the system, a web that has been building since the beginning of the Clinton administration. They have been at the forefront of regulatory deconstruction. They are a huge supporter of Cap and Trade as that is the NEXT major bubble scheme and they are now positioned to take total advantage of that. They own 10% of the exchange that will be trading the carbon offsets, a market that is destined to dwarf the energy market down the road. All their other positions are in PRIVATELY held companies. Too good a deal to let you and I in on, that is for sure, including Al Gore's "little" scam company. Seems he is in partnersip with two very big ex-Goldman boys. Increasingly starting to look like a gangster economy."
Our government and the financial oligarchs have become one and the same. There can be no more illusions as to what is really going on and who are the real culprits.
Jul 19 03:43 AM | Link | Reply
+14 -1
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o Steven Hansen:
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somehow we have equated being legal with being moral. how much of the governments or gs activities seem moral.
is the usa becoming the "great satan"?
Jul 19 04:18 AM | Link | Reply
+9 -1
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o Dialectical...:
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And agreeing with you is going to be just as obvious as John Lounsbury says your being, but I can't help chiming in. The problem is that I think most people kind of realize what you're saying, Common people (like me) have an increasing awareness and sense of frustration that the system is stacked against them. Rich and powerful were always that way, but now the collusion seems more blatant than ever. The transfer of wealth from taxpayers to the rich is a recurring front page story (with very little reading between the lines).
My question is, "What now?" You suggest we "start focusing in on the right people: Congress and the President." but I wonder what shape this focus is supposed to take. Would trying to elect other candidates work? Are there enough potential congresspeople and senators who would NOT serve the needs of GS reflexively? Tax payers certainly have cause for revolt, but how and to what end? How can common citizens (or even uncommon citizens in better positions of power than me) actually respond to these outrages in any meaningful way? These are not supposed to be rhetorical questions, by the way.
Jul 19 04:37 AM | Link | Reply
+8 0
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o morph366:
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Edward
Forget Goldman, Start Worrying About the Government
Look, everyone and his brother are jumping on the “Goldman is evil” bandwagon these days. Even Rupert Murdoch’s Wall Street Journal is talking about Goldman Sachs like they are “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money.” Well, I’m not. I’ve got news for you: you’re barking up the wrong tree.
It’s the U.S. government we should be pointing fingers at. While Goldman (GS) is crying out thank you sir, may I have another as everyone piles on, the U.S. government, which often seems bought and paid for by Wall Street and is the one actually running things here, is getting off scot-free.
Here’s a question for you, if Goldman made out like bandits from the AIG fiasco, who do you think allowed that? Government.
When Goldman’s Lloyd Blankfein was the only person in the room from Wall Street as AIG’s fate was debated, who do you think allowed him? Government.
When TARP funds were disbursed to re-capitalize Goldman and other banks, who made that decision? Government.
When Goldman repaid its TARP funds, paving the way for them to then hand out record bonuses, who do you think allowed this? Government.
When Goldman sold asset-backed securities to investors when it was net short the mortgage-backed market, whose rules do you think allowed this? Government.
Forget about Goldman Sachs. Start worrying about government.
They are the ones who regulate the financial services industry. Government is the one which makes laws governing how financial services companies can and cannot operate. Government is also the one which can change the ground rules going forward to help prevent a recurrence of this sort of financial crisis in future.
As my good friend Marshall Auerback says, the advantages firms like Goldman have are “symptomatic of the problem, but they are not the problem.” The problem is Government and its cozy relationship with the industry it is suppose to regulate and control. The government is captured by the financial services industry, plain and simple. This is why the global financial system is a shambles. The question is: what are you going to do about it?
It seems like the only thing most people are going to do is sit around and whine about Goldman and big banks making a shed load of cash. Then, they’ll get all riled up and angry at Goldman and the rest of Wall Street and try and tax these people to level the playing field. Doesn’t sound like a very comprehensive solution to me.
How about this: stop elections in America from being controlled by money. We can eliminate private funding of the electoral process. Of course, Barack Obama wouldn’t be so happy about this since he owes his election to private funding. And free market zealots will be shouting down this proposal from the word go. But so what? Isn’t it obvious that money drives the political process in the United Sates? Do you have any better ideas?
Here’s another one: let’s get rid of Political Action Committees (PACs) too. Aren’t these just vehicles through which big money can be channelled into supporting one candidate over another. You might want to have a look at the Top All-Time Donors list to see what I mean. By the way, for you Goldman-haters, GS is in 4th place with $30 million donated, right behind our friends at the National Association of Realtors.
And, let’s round out my trifecta of suggestions with a ban on a bunch of lobbying activities. If it were up to me, I’d ban activities like this and this. Why should lobbyists, who usually represent corporate interests, get a seat at the table when you and I don’t? Sure, there are consumer lobbyist groups like the AARP too, but I would restrict their contacts to government as well. And employees of big business should be barred from moving directly from an interested company/law firm to a regulatory.government role and vice versa. They are like lobbyists who are actually inside government: interested parties who will not be able to take arms' length decisions.
So, yes, Goldman is living high on the hog. But the last time I checked, it was Congress and the President who are actually supposed to be looking out for our interests in this representative democracy. Right now, our legislative and executive branches are filled with people who are incentivized to look after the interests of big business and NOT after the interests of individual Americans.
If you want change we can believe in, start focusing in on the right people: Congress and the President.
Related Articles
* Debunking Ortel's GE Short Case Quick Read Jul 19, 2009
* Citibank's Problems Are Far from Over Quick Read Jul 19, 2009
* TALF on the Decline Quick Read Jul 19, 2009
* No Jolt From General Electric - Barron's Quick Read Jul 19, 2009
* Investors Can Bank on Banco Santander - Barron's Quick Read Jul 19, 2009
Related Stocks:
* GS
GS Stock Alerts
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o John Lounsbury:
o Comments (1465)
o • Instablog (104)
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o • Website: http://piedmonthudson.wordpress.com
Edward - - -
You are so right in this article. I do not intend that you take this as an insult, but you are just stating the obvious. What I like about the obvious in this article, though, is that you you present it with saber precision and sledgehammer impact. Well done.
I am reminded of the sound bite from Senator Dick Durbin (D, Illinois) earlier this year, referring to Capitol Hill: "This place is bought and paid for." I would offer another thought: Change the name from "Capitol Hill" to "Capital Hill". After all, isn't that where capital has been invested by the rich and powerful?
Jul 19 02:06 AM | Link | Reply
+15 -4
*
o Sober Realist:
o Comments (456)
o • Instablog (12)
o • StockTalk (1)
o Follow
o
With numerous GS alumni in key government positions, GS has essentially become part of the government. You can refer to the government as a "GSOE" - Goldman Sachs Owned Enterprise. So both GS and the government are equally deserving of the public's wrath. GS, as well as politicians corrupted by campaign contributions, have no moral imperative to protect the well-being of this country and its citizens. Market Sniper summed up the situation best:
"The hubris of Goldman Sacks is breath taking. They no longer even deny it. They are the broker for the Fed and the PPT. They front run the PPT trades. Their server is parked right next to the execution server so they can almost at will, front run large block trades. Their people have been installed at strategic economic and political choke points throughout the system, a web that has been building since the beginning of the Clinton administration. They have been at the forefront of regulatory deconstruction. They are a huge supporter of Cap and Trade as that is the NEXT major bubble scheme and they are now positioned to take total advantage of that. They own 10% of the exchange that will be trading the carbon offsets, a market that is destined to dwarf the energy market down the road. All their other positions are in PRIVATELY held companies. Too good a deal to let you and I in on, that is for sure, including Al Gore's "little" scam company. Seems he is in partnersip with two very big ex-Goldman boys. Increasingly starting to look like a gangster economy."
Our government and the financial oligarchs have become one and the same. There can be no more illusions as to what is really going on and who are the real culprits.
Jul 19 03:43 AM | Link | Reply
+14 -1
*
o Steven Hansen:
o Comments (1443)
o • Instablog (38)
o Follow
o • Website: http://haganescruises.com/nesnah/nesnah.htm
somehow we have equated being legal with being moral. how much of the governments or gs activities seem moral.
is the usa becoming the "great satan"?
Jul 19 04:18 AM | Link | Reply
+9 -1
*
o Dialectical...:
o Comments (19)
o Follow
o
And agreeing with you is going to be just as obvious as John Lounsbury says your being, but I can't help chiming in. The problem is that I think most people kind of realize what you're saying, Common people (like me) have an increasing awareness and sense of frustration that the system is stacked against them. Rich and powerful were always that way, but now the collusion seems more blatant than ever. The transfer of wealth from taxpayers to the rich is a recurring front page story (with very little reading between the lines).
My question is, "What now?" You suggest we "start focusing in on the right people: Congress and the President." but I wonder what shape this focus is supposed to take. Would trying to elect other candidates work? Are there enough potential congresspeople and senators who would NOT serve the needs of GS reflexively? Tax payers certainly have cause for revolt, but how and to what end? How can common citizens (or even uncommon citizens in better positions of power than me) actually respond to these outrages in any meaningful way? These are not supposed to be rhetorical questions, by the way.
Jul 19 04:37 AM | Link | Reply
+8 0
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o morph366:
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o • Website: http://morph366.blogspot.com
Edward
