SEC charges GS with fraud

Quote from MarketMasher:

Tsk, tsk, tsk....

Lloyd, Lloyd, Lloyd........

Ya gonna have to take one fer the team! Boot yer own arse out the door and disgorge all your own personal gains from the last 10 years....

Yer tanking the stock and the company, you dumb-ass mthrfkr!!!!

:D :D :D
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Pu-leeeeeeeeeeeze. Since when did anyone at GS give a shit about anyone else?
 
What is amazing to me is, not a single person has gone to jail yet. How can this be? Everyone is innocent? My guess is that if one person goes to jail, it would implode "Wall Street" (in quotes because this spans the country) because you would have to put hundreds if not thousands of people in jail.

Also, there is evidence that all this behavior was pushed on Wall Street by the US government so that "everyone would own a home and live the American Dream". My God.
 
"A Letter from Goldman Sachs"

NEW YORK (The Borowitz Report)– The following is a letter released today by Lloyd Blankfein, the chairman of banking giant Goldman Sachs:

Dear Investor:

Up until now, Goldman Sachs has been silent on the subject of the protest movement known as Occupy Wall Street. That does not mean, however, that it has not been very much on our minds. As thousands have gathered in Lower Manhattan, passionately expressing their deep discontent with the status quo, we have taken note of these protests. And we have asked ourselves this question:

How can we make money off them?

The answer is the newly launched Goldman Sachs Global Rage Fund, whose investment objective is to monetize the Occupy Wall Street protests as they spread around the world. At Goldman, we recognize that the capitalist system as we know it is circling the drain – but there’s plenty of money to be made on the way down.

The Rage Fund will seek out opportunities to invest in products that are poised to benefit from the spreading protests, from police batons and barricades to stun guns and forehead bandages. Furthermore, as clashes between police and protesters turn ever more violent, we are making significant bets on companies that manufacture replacements for broken windows and overturned cars, as well as the raw materials necessary for the construction and incineration of effigies.

It would be tempting, at a time like this, to say “Let them eat cake.” But at Goldman, we are actively seeking to corner the market in cake futures. We project that through our aggressive market manipulation, the price of a piece of cake will quadruple by the end of 2011.

Please contact your Goldman representative for a full prospectus. As the world descends into a Darwinian free-for-all, the Goldman Sachs Rage Fund is a great way to tell the protesters, “Occupy this.” We haven’t felt so good about something we’ve sold since our souls.

Sincerely,

Lloyd Blankfein

Chairman, Goldman Sachs

http://www.borowitzreport.com/
 
Quote from nitro:

Also, there is evidence that all this behavior was pushed on Wall Street by the US government so that "everyone would own a home and live the American Dream". My God. [/B]
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Nitro, you believe that? Or your post is saying you do not believe that? The loans (origination) is from private brokers outside of the CRA rule. And who fund the brokers? Hmm? The investment banks.

Look here.

"These dangerous products and practices were
primarily, although not exclusively, concentrated
in the subprime and Alt-A markets, where
remarkably rapid growth was made possible by two major
changes in the structure of the mortgage market. First, lenders
began to rely heavily on mortgage brokers to originate their
loans, particularly in the subprime market. Second, Wall Street
became increasingly willing and able to create investment
products derived from riskier loan products, providing massive
amounts of capital for their origination.
These two factors—reliance on mortgage brokers and private
securitization—fundamentally changed the dynamic of the
mortgage market. Under the traditional lending model, where
lenders both originate and hold their mortgages, there is a
vested interest in making sure that borrowers can afford to
repay their loans. In this new system, however, brokers are
making loans on behalf of lenders who are then selling these
mortgages to investment banks, who ultimately pool and sell
complex securities backed by these loans to investors all over
the world. The quality of the loans and their ultimate sustainability
became far less important to those who were driving the
market, especially since their compensation was based on the volume of their transactions, not loan
performance. In other words, the interests of the various links in the mortgage origination chain
were far removed from the interests of the homebuyers.
Consequently, many lenders aggressively marketed and originated loans without due regard for
borrowers’ ability to repay them. As a result, the market became inundated with products that
had been uncommon—such as products with introductory “teaser” rates that reset after a few years
to a much higher rate, loans that did not require income verification, and negatively-amortizing
payment-option products where the balance of the loan could grow over time. These loans were
often made on the basis of weak underwriting and distributed without regard to whether they were
suitable for their borrowers.
Finally, the regulatory system failed by not adapting to the changing structure of the mortgage
market and the increased complexity of mortgage products. Much has been written about the failure
of regulators to identify systemic risks to the safety and soundness of the financial sector. Less has
been written about how the consequences of this failure could have been blunted, at least somewhat,
had the regulators provided and enforced sufficient consumer protections. In fact, federal regulators
actively hindered consumer protection at the state level, ruling that strong state anti-predatory
lending laws could not be enforced on nationally-chartered banks or thrifts.36
Even when agencies focused limited attention on consumer protection, they tended to rely on
disclosure rules and the issuance of non-binding “guidance” over hard and fast rules. It was not until
July 2008, 14 years after Congress had authorized the Federal Reserve Board to prohibit mortgage
lending acts and practices for all originators that were abusive, unfair or deceptive, that the Fed
implemented any rules to ban some of the more abusive practices, despite the fact that borrowers,
state regulators and consumer advocates had repeatedly raised concerns about abuses in the subprime
market and pointed to evidence demonstrating the destructive consequences of such practices.
The foreclosure crisis is
“fundamentally the result of
rapid growth in loans with a
high risk of default—due
both to the terms of these
loans and to loosening
underwriting controls and
standards.”
(snip)
The Red Herrings: Unemployment, the CRA and the GSEs
While the foreclosure crisis is clearly a complicated event with multiple causes, there are at least
three factors whose influence has been overstated: unemployment, the Community Reinvestment
Act (CRA), and the role of the Government-Sponsored Enterprises (GSEs).
Unemployment
In light of today’s high unemployment rates, some observers have claimed that unemployment has
been to blame for the foreclosure crisis. To consider the validity of this claim, it is useful to examine
historical trends —that is, to review how the housing market typically behaves during periods of
high job losses. The chart below shows that, over the past few decades, the connection between
unemployment and foreclosures has been weak. During previous periods of high unemployment,
while delinquency levels did rise, foreclosure numbers remained essentially flat. This strongly
suggests that unemployment, while certainly exacerbating the current foreclosure epidemic, is
not a necessary and sufficient causal factor.
Of course, even if the connection is not as simple as some may have suggested, the current foreclosure
crisis and unemployment are related. The large-scale failure of subprime loans and the financial
derivatives backed by them triggered turmoil in the housing and financial markets, contributing
significantly to the most recent recession and resulting high levels of unemployment. The increase
in unemployment, in turn, has exacerbated the foreclosure epidemic, as many people were losing
their jobs at the same time that they were also facing negative equity positions on their homes.37
In addition, long-term unemployment has grown to 6.7 million as of April 2010 compared to an
average of 700,000 in 2006.38 But even these families would most likely be able to avoid foreclosure
if they could sell their home for enough to pay off their mortgage balance.
The Community Reinvestment Act
There have been persistent attempts to pin the foreclosure crisis on the Community Reinvestment
Act (CRA), a law passed in 1977 designed to encourage depository institutions to increase lending
in lower-income communities. Critics of the CRA used the foreclosure crisis to suggest that lending
to “risky” borrowers who are the beneficiaries of the CRA is at the root of the problem. However,
this accusation is simply not backed by the facts, and banking and government leaders as diverse as
OCC head John Dugan, FDIC Chairman Sheila Bair, Federal Reserve Governor Randall Kroszner
and others have publicly and explicitly stated that CRA did not cause the financial crisis.39 Among
the empirical evidence that dispels the CRA myth are these items:
• CRA has been on the books for three decades, while the rapid growth of subprime and other
non-prime loan securitization and the pervasive marketing of risky loan products did not occur
until recent years.
• Studies have shown that loans made to low- and moderate-income borrowers under CRA perform
better than loans made by originators not covered by CRA or outside of CRA-assessment areas.40
• The Federal Reserve estimates that CRA lending accounted for a mere 6% of all subprime
lending.41 The predominant players in the subprime market—mortgage brokers, mortgage
companies and the Wall Street investment banks that provided the financing—were not covered
under CRA."


http://www.responsiblelending.org/m...alysis/foreclosures-by-race-and-ethnicity.pdf
 
See? IT'S NOT JUST GS

"Wall Street Is Laundering Drug Money And Getting Away With It"

"Too-big-to-fail is a much bigger problem than you thought. We’ve all read damning accounts of the government saving banks from their risky subprime bets, but it turns out that the Wall Street privilege problem is far more deeply ingrained in the U.S. legal system than the simple bailouts witnessed in 2008. America’s largest banks can engage in flagrantly criminal activity on a massive scale and emerge almost completely unscathed. The latest sickening example comes from Wachovia Bank: Accused of laundering $380 billion in Mexican drug cartel money, the financial behemoth is expected to emerge with nothing more than a slap on the wrist thanks to an official government policy which protects megabanks from criminal charges..."

http://blogs.alternet.org/speakeasy...undering-drug-money-and-getting-away-with-it/
 
"Goldman Sachs Cutting Costs, And More Partners Are Retiring"

"The cost-cutting at Goldman Sachs is now reaching the top ranks of the firm.

An unusually high number of partner retirements have been announced internally at the Wall Street bank in recent weeks, according to people who were briefed on the matter but are not authorized to speak on the record. More than a dozen partners have announced plans to leave recently, a much higher number than in the same period in past years..."

http://www.cnbc.com/id/45305361
 
"Lawyer Who Revealed Goldman's UK Tax Deal Could Be Fired: Report"

"A solicitor employed at UK internal revenue service, HM Revenue and Customs (HMRC) is facing disciplinary action, which could include being fired from his position, and possible legal action for blowing the whistle on a deal which saw Goldman Sachs being let off from paying 10 million pounds ($15.6 million) in tax, according to British newspaper The Guardian...."

http://www.cnbc.com/id/45609195
 
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