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Posts Tagged ‘Goldman Sachs’

Goldman Sachs lowers earnings expectations for S&P companies

July 8, 2011 Leave a comment

More depressing economic news:

Goldman Sachs Group Inc., the bank with the highest equities-trading revenue, said its rivals are too enthusiastic about second-quarter earnings prospects for Standard & Poor’s 500 Index companies.

Operating profit will total $23.75 a share for the period, or 2.3 percent less than the average Wall Street estimate, said David Kostin, an equity strategist at New York-based Goldman Sachs. He said 2011 and 2012 earnings-per-share forecasts will be reduced by 2 percent and 8 percent, respectively.

[…]

U.S. corporations are set to report the slowest earnings gain since the recession ended as companies from Ford Motor Co. to McDonald’s Corp. struggled with rising oil and commodity prices and a slowdown in consumer confidence that may continue to hamper spending this year.

 If people wouldn’t use those darn ATMs so much, we wouldn’t be in this mess.

The Obama/Goldman Sachs White House

April 22, 2010 Leave a comment

Just look away, nothing to see here:

While Goldman Sachs’ lawyers negotiated with the Securities and Exchange Commission over potentially explosive civil fraud charges, Goldman’s chief executive visited the White House at least four times.

White House logs show that Chief Executive Lloyd Blankfein traveled to Washington for at least two events with President Barack Obama, whose 2008 presidential campaign received $994,795 in donations from Goldman’s political action committee, its employees and their relatives. He also met twice with Obama’s top economic adviser, Larry Summers.

[…]

Meanwhile, however, Goldman is retaining former Obama White House counsel Gregory Craig as a member of its legal team.

[…]

Several former Goldman executives hold senior positions in the Obama administration, including Gary Gensler, the chairman of the Commodity Futures Trading Commission; Mark Patterson, a former Goldman lobbyist who is chief of staff to Treasury Secretary Timothy Geithner; and Robert Hormats, the undersecretary of state for economic, energy and agricultural affairs.

One can only imagine the uproar if the Bush administration had such extensive connections and ties, both financially and familiarly, with companies like Enron or Worldcom back in the  day.  Sure, Bush had ties to Enron’s Kenneth Lay, but not nearly to the extent that this administration has.  And even then, the media outcry and the left were furious.  Where’s the anger now?  Hypocrites.

Like I’ve said earlier, the SEC coming down on Goldman Sachs was purely political and corrupt–the administration is using various arms of the government for political gain.  Just disgusting.

Pure Politics

April 17, 2010 Leave a comment

Goldman Sachs found itself in a bit of trouble today:

Goldman Sachs Group Inc.—one of the few Wall Street titans to thrive during the financial crisis—was charged with deceiving clients by selling them mortgage securities secretly designed by a hedge-fund firm run by John Paulson, who made a killing betting on the housing market’s collapse.

[…]

The civil charges against Goldman and one of its star traders, 31-year-old Fabrice Tourre, represent the government’s strongest attack yet on the Wall Street dealmaking that preceded, and some say precipitated, the financial crisis that gripped the nation and the world. Goldman’s shares fell 13%, one of the steepest slides since the firm went public in 1999, erasing some $12 billion of market capitalization.

The SEC lawsuit likely strengthens the position of President Barack Obama as he tries to push financial-overhaul legislation through Congress. He vowed Friday to veto any version of the bill that doesn’t bring the derivatives market “under control.”

It’s interesting that this charge is coming on the eve of vote on the Democrats’ financial regulation bill, which more than likely, will have gained momentum from today’s news.  The other story of course, is that it gives Democrats some ammo going into the midterms and to the President for his re-election bid in 2012 as well.

That’s essentially what this story is about until I can tell otherwise.

Two Timin’ Goldman Sachs

March 5, 2010 Leave a comment

The Times ran an interesting piece the other day about the private equity boom of the last decade and the investment bankers that financed them.

Sometimes the PE guys and the bankers were one and the same:

Goldman Sachs had representatives sitting on both sides of the table: the firm was one of the large private equity investors but had also acted as investment banker and lender and would, ultimately, nab a big piece of TXU’s huge commodity hedging business. The bank’s representatives sat quietly during the talks, according to participants.

Goldman was on so many sides of the TXU deal that its representatives made other lenders nervous, according to participants, because it was hard to ascertain whose interests the bank was serving.

Surely there’s nothing illegal here, but how ethical can this be?  I would never try to stop anyone in their ability to make as much money as possible so long as they’re not breaking the law or harming anyone.  And I don’t agree with the latest populist aversion to bankers’ salaries and bonuses and such.  But I guess there’s a reason why Goldman is called the vampire squid.

Corzine: You’re all jealous of Goldman Sachs

February 24, 2010 Leave a comment

The former CEO of Goldman and failed former governor of New Jersey speaks:

Feb. 24 (Bloomberg) — Goldman Sachs Group Inc., the most profitable securities firm in Wall Street history, is unpopular because some people envy its performance, said Jon Corzine, the company’s former chairman and chief executive officer.

“When you’re successful it brings envy,” Corzine, 63, said today in a Bloomberg Television interview. “People are broadly frustrated with the financial institutions, and since it is the leader of the industry and has shown great success over a long period of time, I think it’s more vulnerable.”

Having lived through four, long years of Jon Corzine as governor,  it’s hard to take what he says seriously.  He is your typical limousine liberal.

But seriously, when the game is constantly rigged in your favor, it’s easy to come out on top all the time.  There’s nothing to be envious about.  I think the feeling of most of the taxpayers who helped fund Goldman’s bailout is frustration more than anything.

Obama: It’s great that the I-Bankers received such huge bonuses

February 10, 2010 Leave a comment

What a difference plummeting poll numbers will make:

President Barack Obama said he doesn’t “begrudge” the $17 million bonus awarded to JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon or the $9 million issued to Goldman Sachs Group Inc. CEO Lloyd Blankfein, noting that some athletes take home more pay.

The president, speaking in an interview, said in response to a question that while $17 million is “an extraordinary amount of money” for Main Street, “there are some baseball players who are making more than that and don’t get to the World Series either, so I’m shocked by that as well.”

“I know both those guys; they are very savvy businessmen,” Obama said in the interview yesterday in the Oval Office with Bloomberg BusinessWeek, which will appear on newsstands Friday. “I, like most of the American people, don’t begrudge people success or wealth. That is part of the free- market system.”

Obama sought to combat perceptions that his administration is anti-business and trumpeted the influence corporate leaders have had on his economic policies. He plans to reiterate that message when he speaks to the Business Roundtable, which represents the heads of many of the biggest U.S. companies, on Feb. 24 in Washington.

After a year of failing miserably in trying to appeal to the extremist left-wing of his party with bank taxes, demonizing Wall Street “fat-cats” and siccing his bonus czar on the financial industry, this latest bit from Obama appears to be nothing but posturing.

But posturing to who?  The progressive wing will surely have an aneurism with these comments and conservatives will see it for what it is—a desperate attempt to try and regain some of the political center.  No coincidence, of course, that the President is losing considerable ground with independent voters.  These were the keys to Republican victories in Virginia, New Jersey and Massachusetts, and the key to Obama’s victory in 2008.  My guess is that the never-ending political campaign in the White House right now realizes this.

What  I find even more interesting is the timing of this interview.  Especially in light of the “savvy” dealings of Goldman Sachs and their role in the recent market anxiety about the potential default of Greece:

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.

[…]

…[I]t looks like the Greek figure jugglers have been even more brazen than was previously thought. “Around 2002 in particular, various investment banks offered complex financial products with which governments could push part of their liabilities into the future,” one insider recalled, adding that Mediterranean countries had snapped up such products.

Greece’s debt managers agreed a huge deal with the savvy bankers of US investment bank Goldman Sachs at the start of 2002. The deal involved so-called cross-currency swaps in which government debt issued in dollars and yen was swapped for euro debt for a certain period — to be exchanged back into the original currencies at a later date.

That’s some “savvy” work there. 

The markets have calmed down since Monday as the EU is making noise about a rescue package for Greece.  But it’s still an issue, and if the situation there begins to deteriorate, it won’t take long for someone to connect the dots.  How pathetic will the President’s comments look then? 

Obama picked a weird time to suddenly find the virtue in investment bankers’ bonuses.