The Usual Suspects: Goldman Sachs Scum and Villainy

Goldman Sachs Needs to Be Taken Down

No other organization in the country has their fingers in more pies, no other group of vipers exist that are more sinister, you will not find a more wretched hive of scum and villainy, than at Goldman Sachs. I just can’t say enough about the company and its leadership. The average American [who is blithely stupid] would not have a clue how ingrained the company is in our own government.

The Usual Suspects

The first villain, Hank Paulson, former Secretary of the Treasury. He is the center of the spider’s web, a crafty conniver that used his web of cronies and fed us his methods of funneling public funds to them and their business during the crisis. One of his first positions of power was serving as assistant to John Erlichman, the central architect of Richard Nixon’s Watergate Scandal: a man who believed that when it came to wining seats of power, it’s best to break and enter, steal, and destroy one’s enemies at all costs. Erlichman was convicted on conspiracy, obstruction of justice and perjury. Paulson went on to become CEO of Goldman Sachs.

Let’s go over the players, shall we?

  • John “Two Fingers” Thain, former CEO of Merrill Lynch was a former Goldmanite.
  • Robert “The Mugger” Rubin, also former 26 year Goldmanite, the Chairman of Citigroup.
  • Robert “Shifty Eyes” Steel, the head of Wachovia.
  • Ed “Lady Killer” Liddy, who Paulson put in charge of the nationalized AIG,
  • Mark “The Patsy” Patterson, the current Treasury Chief of Staff,
  • Neel “The Knife” Kashkari, the guy in charge of allocating TARP funds…
  • Tim “Tiny Tim” Geithner was mentored by the afore-mentioned Robert “The Mugger” Rubin.

Well what did this tiny web do? One might ask. First Hank, gave a $800 billion bailout to his distinguished list of friends. They then distributed this money as they saw fit. They then continually came back to the cash cow over and over again. Only this time “Tiny Tim” was in charge instead of Hank.

Wasn’t There a Crisis?

Are you a complete idiot? Let’s review:

  • 2008 the fed cut the rate on top of seasonal demand for crude oil.
  • inflation kicks in.
  • the dollar goes down.
  • by the end of September, housing bubble completely unravels.
  • Goldman Sachs and others approach the SEC and asks, with no federal hearing or inquiry, to have all caps removed from their lending.
  • Goldmana Sachs and others, overleverage themselves to the tune of 30:1 [that’s only for the OTC markets. there’ s no balance sheet stateside, so the inter-bank debt is probably more accurate to 200:1 or 1000:1, no one knows, but don’t just look at the OTC market balance sheet, your’e stupid if you do.]

But wait, GS was not in the same position as say a Leahman Brothers or a Bear Sterns or [gasp] AIG. Instead of them overleveraging themselves on the very mortgages they were underwriting, they were hedging against them. Come September when the housing bubble started [yes i said started] to crash, Goldman was in a fine position. Next was the oil bubble, which congress and the idiots in front of the t.v. [some call them the news media] said was due to offshore wild speculators. Yeah, it was actually Goldman and pals who got a little unknown law, which prohibited any one holder to trade a large portion of a commodity, removed for them. They then speculated the hell out of oil prices, to such a degree that legitimate traders were ousted out of the market. Keep in mind this company makes $50 million a day. So oil was soaring, houses were crashing, what’s next?

Credit Default Swaps
As if idiots don’t know when to quit. After removing the restrictions to have any reserves in the bank before lending money, brilliant move that was, there was another heretofore unknown market called a credit default swap. Some bright Harvard Business School kid came up with it, tried explaining it, no one understood, but he was so darn cute and spunky, and he said they could make money. Everyone got in on it. So, when I say the banks were over leveraged to the tune of perhaps 1,000:1 you might just believe me. One government insider said that the few trillion we’ve thrown at this debacle is a pittance compared to the amount owed in the credit default swap market. He stated that the felt this “shadow bankers” were actually in debt to about $100 – $500 trillion and this $1 trillion is but a mote in the eye of god. Once again, good old Goldman came out with its nose clean. Why? Because the idiots are AIG got a bailout for about $80 billion and turn around and paid Goldman off.

In fact, I say follow all the money and you’ll find Goldman standing in the gap. GM bailout, we know that the UAW didnt’ get that money. We know that the actual investors and holders of bonds didn’t get that money. Hmmm, I wonder if GM had billions in monies owed to some… uknown source, that needed to be paid. One insolvent company, one bailout, one lack of bankruptcy = pay out to a bank.

Why would Obama bailout GM and 3 days later, they announce they are going to go to bankruptcy anyway. Goldman. I guarantee it.

Rob from the Poor and Give to the Rich
As if all of this money weren’t enough, we have their latest scandal. Goldman Sachs purchased a sniffer to the direct access line to the NYSE. They sniffed all the trades coming in. They would then purchase the stock for a small cut, and resell it to the buyer at the asked price. This is known in the business as front running. STOP

Front running – is the illegal practice of a stock broker executing orders on a security for its own account while taking advantage of advance knowledge of pending orders from its customers. When orders previously submitted by its customers will predictably affect the price of the security, purchasing first for its own account gives the broker an unfair advantage, since it can expect to close out its position at a profit based on the new price level. Front running may involve either buying (where the broker buys for their account, before filling customer buy orders that drive up the price) or selling (where the broker sells for its own account, before filling customer sell orders that drive down the price).

For example, suppose a broker receives an order from a customer to buy a large block of 400,000 shares of some stock, but before placing the order for the customer the broker buys 20,000 shares of the same stock for his own account at $100 per share, then afterward places the customer’s order for 400,000 shares, driving the price up to $102 per share and allowing the broker to immediately sell his shares for, say, $101.75, generating a significant profit of $35,000 in just a short time. This $35,000 is likely to be just a part of the additional cost to the customer’s purchase caused by the broker’s self-dealing.

This example uses unusually large numbers to get the point across. It is, however, highly uncommon for brokers to process buy orders totaling $40,800,000 in a single transaction. In practice, computer trading splits up large orders into many smaller ones, making front-running more difficult to detect. Moreover, the 2001 change to pricing stock in pennies rather than fractions of no less than 1/8 of a dollar facilitated front running by reducing the extra amount that must be offered to step in front of other orders.

By front-running, the broker has put his or her own financial interest above (or in front of) the customer’s interest and is thus committing fraud. In the U.S. he might also be breaking laws on market manipulation or insider trading


GS, through access to the system as a result of their special gov’t perks, was/is able to read the data on trades before it’s committed, and place their own buys or sells accordingly in that brief moment, thus allowing them to essentially steal buttloads of money every day from the rest of the world. A former employee, Sergey Aleynikov, who threatened to blow the whistle was indeed arrested and did in fact blow the whistle. He was hired for this very same project and pattented the technology.

If this is at all true, the sniffing stuff, then no one should be trading and the market is virtually dead. If the SEC doesn’t go after them, I say wall street revolts. Oh wouldn’t that be grand to see, coat tails flopping in the summer breeze, guns blazing, women in pants suits getting into fights, people jumping out of windows.

Somehow I doubt it.

Next up: Quarterly Earnings at Goldman Sachs much better than expected.

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Ex law school student. I was kicked out for revealing I had a heart actually beating inside. I used to be in a modern dance company. I'm working on my 7 miracles to be proclaimed a saint by the pope. #1 is really hard, but once i get over that hump the other 6 will be a cinch.

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