It just never stops:
Goldman Sachs helped the Greek government to mask the true extent of its deficit with the help of a derivatives deal that legally circumvented the EU Maastricht deficit rules. At some point the so-called cross currency swaps will mature, and swell the country’s already bloated deficit.
Greeks aren’t very welcome in the Rue Alphones Weicker in Luxembourg. It’s home to Eurostat, the European Union’s statistical office. The number crunchers there are deeply annoyed with Athens. Investigative reports state that important data “cannot be confirmed” or has been requested but “not received.”
At this point, Goldman Sachs should replace SPECTRE as the global villain in any future Bond movies.
General Winfield Stuck
teehee. FTW
Morbo
Yeah, it’ll have to be renamed Silverman Baggs though.
MikeJ
Ima gettin me an iron hat in case they go to flinging theirs at me, I can fling mine right back.
Dan Robinson
Let me channel Sarah Palin on this one.
“They say that these banks are breakin’ laws, but when you ask them for specifics, they start talkin’ ’bout things like credit default swaps. Our Founding Fathers had credit default swaps, they just didn’t call them that. They called them hard work. Hard work that made America. Made our freedoms.”
Dave Fud
I nominate Goldmember.
Those dicks never stop with their relentless f***ing of whoever listens to their bullsh**.
Brien Jackson
In defense of Goldman, it’s the EU budget requirements that are the real villian here. And the ECB.
Dan Robinson
It isn’t the Europeans who are the problem. It’s the damn French.
The Moar You Know
@Brien Jackson: Errr, no. A company that participates in helping a national government hide the extent of its financial problems, using an already discredited form of financial flimflammery that will make said company billions and add to the indebted nation’s deficit, is a company that I think could be, in any fairness, termed “villainous”.
Why oh why
It wouldn’t work, because in Bond movies the vilain has to lose.
R-Jud
@Why oh why:
Winner.
Zifnab
See, the hilarious thing is that Luxembourg officials are upset with Athens for being such a large investor in snake oil, while the Goldman Sachs snake oil salesmen continue to receive a warm welcome.
@Brien Jackson: Oh please. The EU budget requirements are designed to benefit the richer nations in the EU at the expense of the poorer nations, to be sure. But they aren’t so diabolical that they’re designed to implode the Greek Treasury.
Goldman is the loan shark, passing out credit to the renter who can’t pay off his slum lord. It’s just one more fat cog in the fuck-the-poor machine.
Shalimar
Where does Rahm Emanuel fit into this evil power structure?
Max
OT, but this was too funny not to post.
Apparently, Marc Thiessen over at Foreign Policy thinks that Obama is killing too many terrorists. You see folks, Bush / Cheney really knew how to win the “War on Terror” by capturing and torturing them.
My favorite line:
Get it? Dem Presidents are pussies!
Linky to the article here.
drunken hausfrau
Somebody with photoshop skills, please, oh, please do one of Blankfein with a fluffy white pussycat.
It would make a nice valentine’s card for Herr Drunken.
El Cid
Yeah, but on the way into work in Atlanta here, and without iPod or other distraction, I made the mistake of turning on AM radio for yet more rightwing diatribe, this time Republibertard Neal Boortz.
It turns out the real threat to the econmee is that small businesses are shouldering massive increases in unemployment taxes, which is caused by the government extending all these unemployment benefits.
And like clockwork, all his jackass fellow Southerner dumbasses call to chime in.
You know, because if only we’d cut unemployment benefits off and have massive amounts of Americans with no income whatsoever, suddenly all these small businesses could do much better.
‘Cause, you know, the problem in a recession is that there’s just too many people spendin’ money that they shouldn’t.
ericblair
@Dan Robinson: “They say that these banks are breakin’ laws, but when you ask them for specifics, they start talkin’ ‘bout things like credit default swaps. Our Founding Fathers had credit default swaps, they just didn’t call them that. They called them hard work. Hard work that made America. Made our freedoms.”
Stop doing that: you’re scaring the children and panicking the horses. Next thing you’ll be writing “CDS’s = God’s Pony Promises” on your palms.
SGEW
@Max: OT, cont., re: Thiessen.
Yglesias wrote a must-read take-down of Thiessen the other day. Link. Thought you might appreciate it.
Mike E
Jesus–how do you impose jail time on a TBTF corporate giant, or even levy a fine that fits the crime? At some point a sovereign state will get cheesed off enough to send in the commandos. That would be nice, a little war between Lichtenstein and Blackwater!
inkadu
@Zifnab: Oh please. The European Union benefits the poor countries that are its members, while the rich countries are taking a risk letting fiscally irresponsible countries like Greece in. That’s why there are rules.
If the Greeks think they can do better outside the Union, they can leave. At least I think they can. It’s been a while since anyone’s gone to war to keep Greece in its empire.
El Cid
@inkadu: WHERE… IS… SPARTA?!
PAR
@Max
Did you catch John Bolton on CSPAN last night (I know…) but
doesn’t even begin to describe how derisive he was. Full mental neocon.
Brien Jackson
@Zifnab:
And that’s where the ECB comes in; Greece would be in a more stable position if they could devalue their currency, but since the ECB is resisting pressure to pursue even relatively modest amounts of expansionary monetary policy, Greece is totally fucked. Same for Spain.
MikeJ
@Brien Jackson: If you want to be able to devalue your currency, don’t get on somebody else’s standard. Greece probably should have never been let in the EU to begin with.
The Moar You Know
@Brien Jackson: Oh my. You know damn well that this:
equals
The EU is rightly stopping both Greece and Spain from pulling the same financial horseshit that has kept them as fiscally failed states for the last sixty years.
Max
@SGEW: Thank you. That was a good read.
Hopefully, Thiessen is not a young man and will head on out to Hades soon.
rob!
Too bad Donald Pleasance is gone. He would’ve been great as the head of G-S, stroking a kitty in his lap inside a hollowed-out volcano.
Why oh why
@Brien Jackson: Greece lied about its deficit to meet the criteria for entry in the eurozone, so your rants don’t make any sense. There is no good guy in this story.
chopper
at this point, more like K.A.O.S. from get smart. tho the way they bilked the fed out of cash through AIG’s CDS portfolio really was a thing of beauty, in terms of supervillainy.
robertdsc
How about outlawing CDS’s and CDOs worldwide?
Corpsicle
@Shalimar: He is Mr. Bigglesworth.
chopper
@Max:
exactly. killing terrorists with unmanned drones is stupid. putting american men and women in harm’s way to kill terrorists, that’s something we can sink our teeth into.
what movie version would you rather watch? how stupid would ‘band of brothers’ have been if they were all radio controlled machine guns instead?
Morbo
@The Moar You Know: What financial horseshit for the last how many years? Can you name the last year where Spain ran a budget surplus?
Camchuck
Or as Matt Tabbai put it:
Same for the rest of the world I guess.
gopher2b
100 to 1 GS trading desk shorted Greek debt two weeks ago.
Svensker
Oh God, please don’t let the Greek hub read this. He fulminates regularly anyway and double plus fulminates about Goldman Sachs regularly. If he sees this, the fulmination will reach levels normally only seen in the formation of new galaxies. I can’t take it.
SGEW
@chopper: There’s a reason Cameron cut that scene out of Aliens, I suppose.
Roger Moore
@Mike E:
Nah. They’ll just start seizing assets and revoking business licenses. Forbidding Goldman from doing business anywhere in the EU would get their attention right quick. So would arresting the bankers who were personally involved in Greece’s scheme.
inkadu
@chopper: how stupid would ‘band of brothers’ have been if they were all radio controlled machine guns instead?
That would have been Ender’s Game.
inkadu
@chopper: how stupid would ‘band of brothers’ have been if they were all radio controlled machine guns instead?
That would have been Ender’s Game.
tamied
@chopper: This is KAOS, ve don’t BILK here!
Xenos
Once again we have a major media outlet telling a story without any of the necessary political background: all this deception and Wall Street collusion took place under the right wing Karamanlis government, and all the rot is coming to light because Papandreou’s Pan-Hellenic Sockulist Party (Elected to power in Octomber 2009) is trying to clean up the mess without bringing the entire fucking country to a state of ruination in the process.
Sounds just like another country I heard of once…
chopper
@inkadu:
yeah, and how long has that script treatment been floating around. yeesh.
Xenos
Oh, and keep in mind, the reason why Greece is in crisis at this moment is because a certain Wall Street bank, which knew about all the improper reporting and hidden tricks, has been shorting the hell out of Greece’s bonds for the last few weeks. Since the outstanding securities have been run so low Greece will not be able to roll over even short term debt, will default on some bonds, and the ratings of the rest of their bonds will drop to junk status, forcing institutional investors to sell, meaning enormous profits for those bankers who set up the situation in the first place, had the inside information, and took short positions.
Hate to be going all Taibbi here, but this is a perfect crime. If the people forced to sell bonds at enormous losses do not take Goldman Sachs to court over this they will go on and do this again, and again, and again, until we have completed some sort of capitalist apocalypse.
inkadu
@chopper: With all the crap the SF channel puts out, I have to imagine the only thing preventing Ender’s Game from becoming a movie is stubbornness on the author’s part. Have any Orson Scott Card’s stories become films or even TV movies?
debbie
@Xenos:
Isn’t this similar to what GS did to AIG? If not literally, then at least in spirit?
carlos the dwarf
@inkadu:
I’d really hope SF has the good sense to not give any more money to that Christianist wingtard Card.
Mike in NC
This is too damn easy: Goldfinger Sux
Xenos
@debbie: In AIG, Goldman took out insurance policies it knew were not backed by any reserves, and brokered the sale of many more of these policies to foreign governments. So when AIG’s collapse came to a head the Treasury had to bail out AIG to avoid a serious international incident. Happily for all concerned, GS was bailed out, too.
So I would consider that to be a different category of scam, but a scam nonetheless.
The Greek scam seems more like GS’s manipulation of the natural gas market in 2007-8, where they were brought in to broker a deal where they learned the inside workings of a major gas distribution company, and then proceeded to help a different bank to run up or down the price of natural gas for a few weeks, which caused the distribution company to have a purely artificial financial crisis, which was lucky for GS which happened to have a major short position on the stock of that company. At least that was how the story was reported.
inkadu
@carlos the dwarf: I like Wagner too much to care where my entertainment comes from or who got paid for it.
Sloegin
Seems high time for Greece to issue Letters of Marque to the Crimson Permanent Assurance.
Xenos
@Sloegin: ‘…now I’m a broken man on a Piraeus pier, the last of Giorgo’s Privateers.’
The Confidence Man
We should just call them Goldman SMERSH. (There’s a nice euphony with “Hulk SMASH!” too.)
jonas
How much you want to bet Goldman currency traders were busy shorting the shit out of Greek debt and the Euro at the same time?
Ted the Slacker
I’m almost tempted to give Goldman a pass on this activity, because it really is the case here of everyone doing it with any European gubmint.
Citigroup was very big in this space, JP Morgan too, and the more heavily endebted Eurozone countries had these sorts of derivative trades on with just about every investment bank on the planet. If Italy runs into trouble, you’ll see all the usual suspects rear their heads.
Top of the list though, that will be Goldman… the fact the the governor of the Bank of Italy is ex-Goldman, just a coincidence.
Michael
OT – Today’s economic laugher from Citi:
http://www.dailykos.com/story/2010/2/9/835434/-Let-the-Bonuses-Shower-Bankstas-Like-RainCiti-Plans-Crisis-Derivatives
Seems that Citi’s great new game for avoiding suffering from the trauma of accepting only modest returns for responsible lending to small businesses and consumers is to offer a great new financial product – crisis derivatives.
What can possibly go wrong?
Martian Buddy
@inkadu: Good guess.
burnspbesq
@The Moar You Know:
Err, no, yourself.
Go back and read the quoted passage.
Key points: Goldman HELPED the Greek government LEGALLY circumvent the Maastricht rules.
Feel free to argue that what the Greeks did shouldn’t be legal. I will probably not disagree with you. But for the moment, it is legal.
Goldman may have done a lot of things that reasonable people can be unhappy about. This is not one of them.
burnspbesq
@Mike E:
You might want to start by showing evidence that proves beyond a reasonable doubt that said company did every element of an actual voilation of some provision of Title 18 of the United States Code. Anything short of that is a waste of everyone’s time.
burnspbesq
@Xenos:
Hate to be all Johnny Buzzkill here, but not only is what you describe not a crime under existing law as I understand it, it’s far from clear that it is even civil fraud.
Xenos
@burnspbesq: I think you are cutting GS too much slack here. The deal may have been legal, but it clearly was not transparent. And if the left hand of GS hides the true financial status of a client and the right hand of GS goes to the futures market and makes a killing based on that knowledge, that is not, well, kosher.
Think of it this way – if you drafted some of the contracts and instruments in the deal that GS set up for Greece, would you dare to invest heavily in those same debt instruments? Attorneys and accountants have strict conflict of interest rules, but bankers are allowed to rip off and destroy their own clients, I suppose.
If I were running a large company (not that such a thing would ever happen) the last people I would want to do business with would be GS. Talk about inviting wolves into one’s house…
mai naem
This is like a lawyer being the lawyer in a divorce and representing both the husband and wife and then stretching it out so that he can make more money off the divorce.