I’m watching this on C-Span3 while I work, and this just does not feel like the normal dog and pony show. Goldman is getting absolutely fucking killed. Claire McCaskill is close to lining these people up against a wall.
Our Senators are pissed for a change.
Svensker
OK, so they’re pissed. Are they going to do anything about or just go in front of the cameras and talk about “disgrace” “murican people” etc.? My best would be nothing.
Jim, Foolish Literalist
Not watching. Maybe I should. Are Republicans joining in? Of course, beating up on a GS bankster for the cameras is easy and free. They still voted to keep the scams going.
r€nato
What #1 and #2 said.
Congressional hearings are notorious for allowing congresscritters who love the sound of their own voices, to preen and pose for upcoming campaigns. It feels good to watch this stuff… but I’m more interested in what they *do*, not the tongue-lashing which will have zero effect on GS’ way of doing business.
Ash Can
LOL! It was worth it to tune in just now just to hear Claire McCaskill call one of GS’s deals “shitty.”
Rhoda
I have it on too. I literally LOL when the Goldman guy said I want to avoid the betting analogy.
Der Blindschtiller
Good on the Senators. Parade these wankers before the American public and let the Republicans keep filibustering the bill. Better yet, they even managed to get a Frenchman up there. Fairly or not, this will help solidify hatred of Wall Street among real Amuricuns.
PurpleGirl
Does this mean they’ll go into the next vote on reform and do the right thing. I’d like the bill to be stronger but if it includes some measure of regulating swaps and derivatives, I’d be happy.
I’d really to bring back Glass-Steagall. It worked for many years quite well.
Rhoda
@Svensker: I think financial reform has been getting stronger as it moves through the legislative process. Hell, you have Republicans reduced to saying this bill doesn’t break up the banks and it’s not good enough. Wall Street would be screwed if Demcrats said okay, we’re going to break up the banks then too.
The problem for the street, everyone wants there money but everyone wants to make it clear they’ve not been bought. So strong stuff, like Lincoln’s derivatives language, gets into the bill.
This isn’t like health care. Everyone is good and ready to fuck over the bankers.
flukebucket
Well. That only means it is a better than usual dog and pony show.
It is still just a dog and pony show.
qwerty42
@Jim, Foolish Literalist: Even so, I’d say there is a lot of anger out there and it is very bipartisan. We’ll see if that has any real effect.
Ash Can
@r€nato: They may do nothing themselves, but the simple process of airing out GS’s internal e-mails isn’t going to do the firm any favors in a business that relies as heavily on reputation as investment banking does. It may not be as good as an official sanction, but GS isn’t going to get off entirely scot-free here.
Omnes Omnibus
Pryor, with his “Why not?” repetition, is doing well.
dr. bloor
Boy, the letter is going to be reeeeaaaally sternly-worded this time!
The Moar You Know
It’s good Senatorial fun to give people carte blanche to destroy the economy and then pillory them for doing it.
Want to impress me? Vote on the fucking finance reform bill as it stands. Beat Up On Blankefein Hour does not impress me. At all.
Omnes Omnibus
@The Moar You Know: 57 Dems did (58 if you count Reid’s tactical no).
jrg
If you really wanted to join the P.F.J., you’d have to really hate the Romans.
ruemara
yeah, call me when there’s jail time and legislation. And a refund. I want my money back.
REN
If some effective regulation is not passed, keeping your retirement money exposed to these people is an act of insanity.
The Dangerman
@The Moar You Know:
Ditto. Until these swine fuckers are figuratively swinging from the end of a rope, this is all just icing on a cake that they will let us eat (do I win the mixing of metaphors award today?).
Joel
Sparks is slick.
But he got stumped by the simplest question:
“Do you believe Goldman’s actions contributed to the recent downturn in the economy?”
Brien Jackson
I’m not seeing where the beef is, to be honest. If this is the best they can come up with on Goldman…
MattF
Not-OT, Greek debt is now officially junk, and the c-word (‘contagion’) is starting to be tossed around. It’s quite possible that there will be a couple of countries in default in the not too distant future. If you’re not worried about this, you should be– the nexus between finance and politics is starting to look quite scary, at least to this stock-and-bond holder.
Zifnab
@flukebucket:
It’s Congressional rabble rousing. The Senators want to get the Goldman guys on the record, so that when they get up and announce “We’re regulating derivatives X, Y, and Z as such” they can point to guys like Mr. Sparks waxing poetic about winners and losers and the shame of it all, call him a liar and a thief, and sell the legislation on the promise that next time Mr. Sparks will get to see the inside of a jail cell if he gets caught doing this again.
If they don’t have Sparks up there yapping his yap, it becomes harder to highlight him as a symptom of a broken system.
Rosalita
It’s an election year and this is easy kill for them, will get them votes. How’s that for cynical? Not that it’s not pleasing to see.
Martin
Of course they’re pissed – they can’t call out the GOP to be a bunch of amoral pigfuckers for blocking reform, but hey! Goldman CEO is showing up for lunch today! Let’s eat his liver instead!
Honestly, in a just world, Reid would be going back to the GOP today and saying “Ok, you got your filibuster. In our next round of negotiating we’re taking away 3 things you guys wanted. You can keep filibustering, but eventually everyone knows you guys are going to vote and the longer you wait, the less you’ll like this. I’ll drive this to the point that we need to haul Biden’s ass in here to break a tie if need be.”
Alas, the world does not work that way.
John Cole
@MattF: And guess who had a hand in Greece…
Michael
Portugal and Ireland will be next up.
wobbly
You should be working while you work, not watching C-Span or blogging.
Joel
Uhoh, Senator Ensign is up! I’ll bet the Goldman boys are shaking in their boots right now!
Arguingwithsignposts - ipod touchs
Damn now I have to pick up some popcorn on the way home to watch the replay!
Nikki
@Martin: If only it did. If only it did.
sukabi
wasn’t expecting Ensign to shutter at the comparison of Wall Street to Vegas… Vegas is more honest, you know the odds going in, don’t change in the middle of the game … LOL!!!
called them market manipulators not market makers… another LOL…
in an off note, when is Ensign going to be indicted?
rootless-e
Ensign: do you guys have the high moral character needed to get your parents to bribe the husbands of women you had affairs with?
Joe Lisboa
@Ash Can: She was quoting the actual language from an internal Goldman memo describing the Timberwolf deal as “a shitty deal” despite the fact they continued to make millions on the aforementioned shitty deal. Carl Levin (D-MI!) really went after them on this, it was great, TPM has the video.
Ash Can
Also, something to keep in mind (as even John Fucking Ensign pokes these shitheels around a little) is that all of these senators have substantial amounts of their own moolah invested with people just like these. It would be impossible for them to look at these guys and not have a tiny little voice in the back of their minds saying, “Do I really know exactly what my buddy the personal banker is doing with my money?” This is different from HCR; these guys really do have skin in the game.
srv
What Stiftung said. The worst that can happen is that Goldman will have to change it’s name to Xe or something.
flukebucket
@Michael:
Maybe I am just confused but it seems like only yesterday that Ireland was being help up by the right wingers as some kind of Utopia of Capitalism.
Suitable for framing.
Ash Can
@Joe Lisboa: I see. It still cracked me up, though. She certainly didn’t miss a beat in her quotation. :)
handy
Anybody read this Teabagger claptrap yet? (Sorry if it’s been linked already).
Yes, the problem isn’t Goldman and its Wall Street cronies: it’s those darned politicians in Washington. Of course, it is the politicians in DC inasmuch as they continue to do Wall Street’s bidding, and have done so for the past 30 years.
J.
I’m with @Svensker.
The senators can pontificate and say “shitty deal” all they want but the truth of the matter is Goldman (and/or one of their financial brethren) owns most of them. Talk is cheap. Re-election campaigns cost money.
Bring back the Glass-Steagall Act!
Btw, heard some of Fabrice Tourre’s speech earlier. Short version: “I speet on yu. U ar all eediots. Reevenge ees mine!” Frogs.
Irony Abounds
The market doesn’t think Goldman is getting killed. GS stock is up on an otherwise down day. There is a true disconnect between the real world and Wall Street.
Comrade Mary
@Joe Lisboa: Thanks, Joe. I found the Levin “shitty deal” video here and some non-shitty McCaskell here. She’s shocked — shocked! — that there’s gambling going on here.
Irony Abounds
It really is bizarre to have Ensign discuss ethical questions with anyone. Meanwhile, the Fabulous Fabrice is going to be set up as the fall guy.
sukabi
someone needs those tools to actually define “ethics”.. .what were the specific items in the “code of ethics” at Goldman… I can guarantee you they wouldn’t be the same as what everyone else defines them as…
The Moar You Know
@Irony Abounds: No disconnect at all. The investors understand that this is bread and circuses for the idiot masses, no more, and the rubes have been selling of Goldman stock for the last week thinking that there was going to be some sort of substantial penalty levied against them.
That won’t happen.
So it’s a great time to buy GS stock. And the rich get richer!
Joe Lisboa
@Ash Can: Oh yeah, I know, it even cracked me up more knowing they were being hoisted on their own petard.
rootless-e
Shorter goldman: there’s a reason I made $100M and you didn’t dumbfuck.
Joe Lisboa
@Comrade Mary: Thanks for posting the links, I was in a rush.
Brien Jackson
@Irony Abounds:
That’s because Goldman really isn’t getting killed. The stuff the Senators are trotting out really isn’t that damaging, or even shady.
rootless-e
GS has a valid point: it is not their responsibility to force their clients to be smart or prudent.
Linda Featheringill
@MattF: Greece.
So you are saying that the efforts of Europe could not keep Greece afloat? And it is going to sink anyway? Or at least it will probably default on the debt?
demo woman
How long before the DSCC sends out an e-mail selling “IT’s a Shitty Deal” t-shirts?
JK
This should last for about a day
MattF
@Linda Featheringill
Europe (i.e., Germany) might well decide to let Greece find its own way here. Felix Salmon has some thoughts on this. The recent public Greek reminiscences of German behavior in WWII might not be helping either.
rootless-e
Levin is hammering GS now.
Wordsmith
Mr. Sparks is playing dumb; I can’t stand shitheads who ‘play dumb’ when they know damned well what’s gone down & just being a weasel.
licensed to kill time
__
Goldfinger!
It’s a biz, a biz with a heart of Gold
It’s heart is cold
Adrienne
@rootless-e:
I call bullshit. No matter how you slice it, GS *DOES* have the responsibility to NOT be the ppl ripping their clients off. It’s called fiduciary responsibility. Look it up.
terry chay
@Jim, Foolish Literalist: NYT is reporting that Collins of Maine is also questioning hard. Since she and Snowe both voted to block the bill, it does speak to the other’s point.
There was an editorial in the NYT blaming the problem on Goldman Sachs, the banks that bought the CDO (IKB and one other), the firm under whose name it was, and the Fed regulators. It said it blamed everyone.
Really? Everyone? What about the person who designed the CDO so he could short it using a CDS: Paulsen. Sure, he didn’t do anything illegal (Yet, really, I think the SEC is going to flip Fab and go for bigger fish), but clearly he and others were exploiting a well-known loophole in the financial regulatory system that would cause all parties to do it. As per, another great This American Life episode worth listening to. (BTW, John, part 2 is about drug enforcement.)
@PurpleGirl:
I don’t think Glass-Stengal is a solution unless you deal with the reason the banks manipulated the government to repeal it in the first place. The argument goes that there is this huge unregulated market (derivatives, of which CDO and CDSs are a part), which the banks are hamstrung from participating in (as they should because their money is insured by the FDIC). This puts them in a weak position in the financial world and they don’t want that (after all, that’s sort of like most pension funds which then get forced to buy AAA rated stuff which then get manipulated by the same unregulated market to have AAA ratings on shit).
Otherwise, when times are good they’ll find a way to repeal again.
MikeJ
All nighters!
http://swampland.blogs.time.com/2010/04/26/thank-you-sir-may-we-have-another/
mr. whipple
For those that haven’t see it, this has been going on for a week. It’s followed the whole sordid tale from beginning to end. Levin and his staff have been masterful.
Today, because GS is there area lot more Senators present to get their faces on TV, but the core group has been awesome all along.
Wordsmith
Nor do I like someone who defends the indefensible.
rootless-e
@Adrienne: Levin got them on a clear ripoff with the Hudson deal.
But Ensign and Testler’s questions were stupid.
Shinobi
Sen. McCaskill was kindof awesome. Two things these hearings are missing for maximum lolz:
1. Al Franken
2. “I do not recall.”
mr. whipple
@rootless-e:
Agreed. I expected better from Tester.
rootless-e
Jesus, fuck, Levin is destroying them.
Wordsmith
Mr. Whipple –
Carl Levin is clearly & awfully disgusted.
Wordsmith
Now if we could just do something with Carl’s comb-over….
rootless-e
The interesting fact, however, is that given the same signals, Lehman and Bear and Shitty all failed to react. Goldman’s sin is stuffing their risk onto their customers, but the other players just dragged their customers down with them.
Wordsmith
Oh! Bathroom break! Coburn is up
terry chay
@rootless-e: But they do have a duty to disclose, which is what the SEC case is about.
Basically from the interview, I think it looks bad for Goldman Sachs w.r.t. the actual civil case. So far it sounds like the only defense they’ve come up with is Fabrice Tourre’s word (recollection) that he did disclose to one of the banks that Paulsen was picking the shares was planning on shorting the highest tranche. (I’ll bet Paulsen shorted it all).
I’ve never really heard the “the people we duped were morons” as being a successful defense (nor is the “we lost money too” defense). That stuff may play okay with the masses, but the law is pretty clear here.
Joel
MikeJ@60:
[All nighters!]
Too bad Pete Domenici is no longer in the Senate. He liked to wear his flannel pajamas around the office, so I’m sure he’d really enjoy showing off his fashion sense with a 2 AM pillow fight in the Senate chamber.
scudbucket
This is the most fun I’ve ever had at cspan. These Squidlies are getting pummeled.
rootless-e
@terry chay:
Well, their defense is that purchasers and ACA and Moodys (or was it S&P) all maintained that the value and risk was a function of the assets, not whether a then obscure hedge fund was betting one way or another. The ratings agencies and ACA described their methodology and it was based on hocus pocus fake statistical analysis, not on what they knew about who was short or long.
Since ACA discussed the deal directly with Paulson, of course, they also had the opportunity of both asking him and disclosing to the customer.
rootless-e
BTW: Greece could solve its financial problems by abandoning its arms race with Turkey, but …
mr. whipple
@Wordsmith:
He has been for the last week, as have I. It began with WaMu and other mortgage outfit scumbags(and indirectly the scumbags that lied on stated income loans), the scumbags regulators that didn’t do their jobs, the scumbags at ratings agencies that didn’t do their jobs, and today the scumbags on Wall Street.
It really is a sad reflection on humanity from the people that got the loans all the way to Wall Street.
mr. whipple
BTW, Coburn has been very good through this whole thing, which just goes to show he can be pretty smart when he wants to be.
LanceThruster
A thorough investigation would most likely lead to Congress and therefore will not be done. Someone else will be thrown under the bus or asked to fall on their sword.
Chuck
@sukabi:
Vegas cah-see-nos are also tightly regulated and they actually pay taxes.
(you do not want to type the c-word here)
Brien Jackson
@Adrienne:
GS doesn’t have anymore obligation to prevent their clients from doing something stupid than Ryan Howard has to decline to accept the Phillies contract extension offer.
Wordsmith
It is a shame that Mr. Tourre is such a cutie-pie. We’ll have to overlook that for now.
Brachiator
Which means that they are holding out for bigger bags of money in exchange for sandbagging effective financial reform.
Adrienne
@Brien Jackson:
Bullshit. Way to build a strawman though.
I didn’t say that they have the responsibility to prevent their clients from *doing* anything. HOWEVER, in their duties as REPRESENTING their client, ie: their fiduciary duties, they do indeed have a responsibility to do the following:
1) Not withhold pertinent information which the client needs to make a well informed decision.
2) Not profit from losses that the client sustains due to any information they willingly withheld.
GS failed on BOTH of these point and THAT is what the SEC charges stem from. What they did was blatantly unethical, and illegal as far as the SEC is concerned. They were wrong. Period.
mr. whipple
It’s amazing to me how Fab can remember the tiniest of certain details, and have totally no recollection of others.
Wordsmith
@mr. whipple:
Which is precisely why I must, I must, overlook his cutey pieness.
rootless-e
@Adrienne:
The hudson deal is a clear problem: GS us unloading risk on its customers without disclosing, except indirectly, that it is in a panic about the market and desperately shorting. I think in this case, they are utterly and totally at fault – if they sold to customers depending on them for advice. On the other hand, if they sold crap to Bear and Lehman – I don’t care.
However, to me the Aurora deal is more unclear because it was commonly accepted that the ratings agency and manager risk methods were not only valid, but highly reliable. The effing Basel 2 apparently said that high rated tranches were acceptable as regulatory cap. The theory was that historical/statistical analysis provided valid risk information. Since Moody’s and ACA were insisting that their models were reliable and those models depended only on the information that was disclosed, I think the case is somewhat fuzzy.
On the other hand, I don’t care if they get the death penalty for a fabricated parking ticket violation.
mr. whipple
This dood up now is totally and completely unbelievable. He’s either lying or grossly incompetent.
mclaren
Kabuki.
Sloegin
Are 1000 Wall Streeters going to jail?
100?
1?
It’s a congressional waah waah wankfest. Wake me when something positive results from it.
tworivers
I’ve only gotten to hear a bit of the hearings, but so far I find all the GS guys nauseating to listen to.
Is it me, or does Birnbaum just ooze contempt? From the brief period I saw him talk, it seemed like he had the whole defiant, “fuck you” attitude going. Or rather, the whole “fuck you, I got mine” attitude.
And they wonder why the vast majority of the country loathes their asses
lawguy
They talk real good. They use their mouths prettier than a $30.00 whore. Don’t worry nothing will come of it expect some sound bites.
Tom65
Whatever. None of these bastards will do half the time Martha Stewart did.
Joel
Mr. Whipple @ 77:
Agreed, and it is not easy for me to type that. But on this issue, Coburn seems to be largely not-unpleasant to listen to.
I can’t believe Fabby Fab didn’t catch a clue when Coburn pressed him about (a) Goldman’s motives in releasing the personally damaging (to Tourre) e-mails, and (b) whether Tourre was receiving legal representation courtesy of his employer (affirmative).
GET A PRIVATE LAWYER. You may swim with sharks, and you may have been an up-and-coming sharkling yourself, but now you are now nothing but CHUM and Goldman intends to screw you even worse than they screwed their clients.
El Cid
The Pecora Commission hearings helped provide support for New Deal era banking regulations. Maybe this can somewhat help as well.
Comrade Mary
I think someone needs to market a “Goldman Sachs is a Big Shitty Deal” t-shirt.
Svensker
@J.:
Plus, he’s a typical Master of the Universe — when he comes out from behind the curtain, he’s just a dweebie dweeb. Punk.
AhabTRuler
The funny thing is that the afternoon session with the CFO and CRO showed how unpolished these guys are at the bullshit game. They stalled for time, had to think over their answers, at times were sullen and defensive, answered the questions they wanted to answer or though were asked, rather than the questions asked, and generally pissed off even the Senators who were inclined to be favorable (Coburn really wanted to go easy on these guys, but even he came up with “we’re not stupid…” to the assholes).
But the big boys from upstairs…they were calm, confident, and on point: emphasizing the net position and numbers from across the business, but also willing to give straight answers when necessary. Yes, they dissembled and temporized as well, but it came off so much better than the morning assholes.
Indeed, one wonders if the mid-level guys have ever had to present under such conditions: a hostile audience (Sens looking for someone to whip on), with such status (Sen > mid-level bankster), and who did not necessarily accept their assumptions about the world.
AhabTRuler
@AhabTRuler: Oh, except for the bit about it being unfortunate that the emails about the shitty deal had come out. Classic non-apology apology. That was a bush-league unforced error, but at least he knew it and stopped trying to save the situation and instead tried to move on.
debbie
The excerpts I saw reminded me of the testimony of the tobacco executives who swore they did not believe tobacco was addictive.
Anton Sirius
@The Moar You Know:
Except that it’s not way up. GS stock barely budged today — it closed up about one whole point — and is still down about 15% since the announcement of the SEC suit.
Telling people to buy GS right now is Jim Cramer-level advice. It’s the sucker play.
Batocchio
Go this route, and make it bread and circuses versus dog and pony show, and I’ll watch.
bob h
I none of the Senators is rude enough to ask Goldman about its role in the Greek meltdown.