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RE: US Bankers control USA - 1/17/2010 7:39:52 PM
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prophet
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http://www.cnbc.com/id/34877347
Big Banks Accused of Short Sale Fraud
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RE: US Bankers control USA - 1/21/2010 6:26:20 PM
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prophet
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Bank Failures Should Destroy CEOs, Buffett Tells Fox
January 21, 2010, 03:04 PM EST
By Jamie McGee
Jan. 21 (Bloomberg) — President Barack Obama’s proposal to regulate banks should include a requirement that chief executive officers and their spouses forfeit their assets when companies fail, billionaire Warren Buffett said on Fox Business Network.
“There ought to be a huge downside,” said Buffett, whose Berkshire Hathaway Inc. is the largest shareholder in Wells Fargo & Co. “Make it so that the CEO of an institution that fails, or goes to the government and needs help, really gets destroyed himself financially. Why should he come out any better than somebody that gets laid off as an auto worker at General Motors?”
Buffett, who collects a $100,000 salary as Omaha, Nebraska- based Berkshire’s leader, said CEOs must act as the “chief risk officer” of their companies. He has repeatedly criticized bankers for failing to realize that housing prices could fall and said they exacerbated their mistakes by borrowing to increase the size of their failed bets.
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RE: US Bankers control USA - 1/21/2010 6:33:00 PM
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prophet
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GO OBAMA! 
http://abcnews.go.com/Business/wireStory?id=9626998
A new proposal from President Barack Obama to limit the size and trading capabilities of big banks sent shares of major financial institutions plummeting Thursday.
From the White House, Obama vowed to fight big banks with tougher regulations that he believes would head off the cascading failures that required billions in bailout funds for Wall Street.
He wants new rules that would restrict banks in the use of depositor money and also limit how big financial institutions can become.
"The market certainly perceives this can only have a negative impact on big bank profits," said Hal Reichwald, co-chair of the banking and specialty finance practice group at the law firm Manatt, Phelps & Phillips LLP.
The new rules could mean national banks would lose the tools that have helped offset huge loan losses over the past year, but they are also some of the same tools that got them into trouble in the first place.
quote:
Goldman Sachs’s sale of mortgage-backed securities, its requests to the credit-rating companies for the highest rating while betting the securities will later fail.
< Message edited by prophet -- 1/21/2010 6:44:51 PM >
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RE: US Bankers control USA - 2/9/2010 6:23:06 PM
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prophet
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http://www.spiegel.de/international/europe/0,1518,676634,00.html
How Goldman Sachs Helped Greece to Mask its True Debt
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."
Creative accounting took priority when it came to totting up government debt.Since 1999, the Maastricht rules threaten to slap hefty fines on euro member countries that exceed the budget deficit limit of three percent of gross domestic product. Total government debt mustn't exceed 60 percent.
The Greeks have never managed to stick to the 60 percent debt limit, ...........
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RE: US Bankers control USA - 2/9/2010 6:26:26 PM
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prophet
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http://www.dailyfinance.com/story/insurance/sec-investigating-goldman-over-aig-collapse/19349455/
SEC Investigating Goldman Over AIG Collapse
Did Goldman Sachs Group (GS) force American International Group (AIG) into the arms of the U.S. government? AIG, the financial institution now 79.9%-owned by the U.S. Treasury, cost taxpayers $182.3 billion in cash and guarantees, and paid Goldman $12.9 billion as part of a backdoor bailout. Now, the The New York Times has the nerve to suggest that Goldman's demands for money are what shoved AIG over the edge.
The clear picture that emerges from the complex details is that the Golden Rule ruled in the relationship between Goldman and AIG. And by the Golden Rule, I mean the one that states he who has the gold makes the rules. In this case, Goldman had the gold. The result was that when there was any ambiguity in the contracts between AIG and Goldman, Goldman got the benefit of the doubt. Now the SEC is investigating whether Goldman stepped over the line and used that clout to push AIG toward collapse.
In its 2007 and 2008 dispute with AIG, Goldman asserted that the mortgage-backed securities that AIG was insuring were worth less than AIG thought they were. And Goldman used that lower valuation to get more cash out of AIG while simultaneously using those lower valuations to boost the value of Goldman's bets on the collapse of the mortgage market.
In so doing, Goldman used the Golden Rule to its benefit. Goldman demanded and got $2 billion in payments from AIG. But AIG and Goldman did not agree on how much Goldman was owed.
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RE: US Bankers control USA - 2/9/2010 6:45:35 PM
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prophet
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http://www.nytimes.com/2010/02/07/business/07goldman.html
Testy Conflict With Goldman Helped Push A.I.G. to Edge
Billions of dollars were at stake when 21 executives of Goldman Sachs and the American International Group convened a conference call on Jan. 28, 2008, to try to resolve a rancorous dispute that had been escalating for months.
A.I.G. had long insured complex mortgage securities owned by Goldman and other firms against possible defaults. With the housing crisis deepening, A.I.G., once the world’s biggest insurer, had already paid Goldman $2 billion to cover losses the bank said it might suffer.
A.I.G. executives wanted some of its money back, insisting that Goldman — like a homeowner overestimating the damages in a storm to get a bigger insurance payment — had inflated the potential losses. Goldman countered that it was owed even more, while also resisting consulting with third parties to help estimate a value for the securities.
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RE: US Bankers control USA - 2/9/2010 6:52:42 PM
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prophet
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http://www.huffingtonpost.com/raymond-j-learsy/the-question-unasled-agai_b_453095.html
The Question Unasked Again and Again of Goldman Sachs, Lloyd Blankfein and Hank Paulson
A stunning and disturbingly informative front page Sunday New York Times article was written by the Time's Business Page columnist Gretchen Morgenson and Louise Story, "Testy Conflict With Goldman Helped Push A.I.G. to Precipice". It quotes Bill Brown, a Duke University Law Professor and former Goldman and A.I.G. employee saying that the dispute between the two companies "was the tip of the iceberg of this whole crisis".
The article details the demand for billions of dollars made against A.I.G. 's complex insurance derivatives (Credit Default Swaps and Obligations) by Goldman, claiming that pay downs were triggered as the housing mortgage market collapsed. All the while Goldman was taking proprietary positions, in effect shorting the housing backed mortgage instruments, allegedly pushing their values down, thereby setting the stage for a rancorous dispute with AIG. The dispute centered around establishing the values being assigned to the underlying instruments and in consequence the level of pay down owed to Goldman.
According to the article, Goldman resisted letting third parties value these securities even though third party price determination was required according to the contract documents. Nonetheless, with the housing market melting away, billions were transferred by A.I.G. to trading partners -- especially Goldman -- before September 2008 when A.I.G. was on the verge of collapse. In the year before the A.I.G. bailout, Goldman had already collected $7 billion from A.I.G. and of course many billions more after the bailout. This in spite of a determination by Black Rock, one of the nation's leading asset management firms, that Goldman's valuations on the A.I.G. derivatives were "consistently lower than third party prices," thereby making the pay downs from A.I.G. to Goldman greater than they needed to be. Further, according to the NYTimes, the SEC is investigating whether any of Goldman's demands improperly distressed the mortgage market, in that Goldman would stand to gain handsomely from the implosion of the housing market and the crash in value of housing backed mortgages.
In 2006 Hank Paulson left Goldman Sachs to become Secretary of the Treasury in the Bush Administration. That same year Goldman Sachs began to "make huge trades that would pay off if the mortgage market soured. The further mortgage securities fell, the greater were Goldman's profits." Consider, you own your home and here was a financial behemoth, through its trading strategies, doing all in its power to make your home worth as little as possible. Ah, the wonders of creative finance!
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RE: US Bankers control USA - 2/12/2010 1:26:24 AM
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prophet
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http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/7217200/Goldman-Sachs-faces-Robin-Hood-tax-vote-rigging-claims.html
Goldman Sachs faces 'Robin Hood tax' vote-rigging claims
Goldman Sachs is investigating claims that one of its computers was used to rig a public vote on the introduction of a so-called “Robin Hood tax” on bankers.
The Robin Hood Tax campaign alleged that a Goldman computer was one of two computers that allegedly “spammed” the internet poll with more than 4,600 “no” votes in less than 20 minutes on Thursday.
Technical staff for the Robinhoodtax.org.uk website said the “no” counter increased at a “dramatic rate” from 3.41pm.
Related Articles
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I'm happy to play my part in the great Robin Hood Tax
Bill Nighy stars in Robin Hood tax advert
Setanta faces final whistle over bills
Setanta buys time from backers
TV shows including Doctor Who 'giving children nightmares'The number of “no” votes jumped from 1,400 to 6,000 before campaigners – who are calling for the introduction of 0.05pc tax on banking transactions – tightened the site’s security.
Robin Hood’s security team claimed it traced the erroneous votes to two computers, one of which is allegedly registered as belonging to Goldman.
A spokesman for Goldman said the bank had “just received this information and is investigating fully”.
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RE: US Bankers control USA - 3/2/2010 6:35:48 PM
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prophet
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Greece-Goldman Sachs Deal 'Completely Scandalous" and Perfectly Legal
The huge currency swap deals that Goldman Sachs arranged with the Greek government were at once completely legal and completely scandalous, says Martin Wolf, the chief economics commentator at the Financial Times.
Wolf sat down with Aaron Task of Yahoo Tech Ticker recently and discussed the deals that helped the Greek government hide billions in liabilities and earned Goldman Sachs some $1 billion in fees.
http://www.huffingtonpost.com/2010/03/02/greece-goldman-sachs-deal_n_482001.html
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RE: US Bankers control USA - 4/12/2010 8:09:46 PM
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prophet
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http://www.blacklistednews.com/news-8234-0-13-13--.html
BOMBSHELL – Whistle Blower Comes Forward With Solid Proof The Price Of Gold And Silver Is Being Manipulated By Major Financial Institutions
Published on 04-12-2010 Email To Friend Print Version
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By Michael Snyder - BLN Contributing Writer
For a long time many of us have had very serious suspicions that the prices of gold and silver were being highly manipulated. But now, thanks to the mind blowing testimony of one very brave whistle blower, the blatant manipulation of the world gold and silver markets is being blown wide open. What you are about to read below is absolutely staggering. Once the American people learn how incredibly corrupt the world financial system is, it is going to change everything. The government that we are all trusting to guard the integrity of the financial system is failing to do that job. It turns out that the Commodities Futures Trading Commission has been sitting on solid evidence that the elite banking powers have been openly and blatantly manipulating the price of gold and silver. Even though they were basically handed a "smoking gun", they have done absolutely nothing with it. But now the information has gone public and the CFTC is red-faced.
Back in November 2009, Andrew Maguire, a former Goldman Sachs silver trader in Goldman's London office, contacted the CFTC's Enforcement Division and reported the illegal manipulation of the silver market by traders at JPMorgan Chase. Maguire told the CFTC how silver traders at JPMorgan Chase openly bragged about their exploits - including how they sent a signal to the market in advance so that other traders could make a profit during price suppression episodes. Traders would recognize these signals and would make money shorting precious metals alongside JPMorgan Chase. Maguire explained to the CFTC how there would routinely be market manipulations at the time of option expiries, during non-farm payroll data releases, during commodities exchange contract rollovers, as well as at other times if it was deemed necessary.
On February 3rd, Maguire gave the CFTC a two day warning of a market manipulation event by email to Eliud Ramirez, who is a senior investigator for the CFTC’s Enforcement Division.
Maguire warned Ramirez that the price of precious metals would be suppressed upon the release of non-farm payroll data on February 5th. As the manipulation of the precious metals markets was unfolding on February 5th, Maguire sent additional emails to Ramirez explaining exactly what was going on.
And it wasn't just that Maguire predicted that the price would be forced down. It was the level of precision that he was able to communicate to the CFTC that was the most stunning. He warned the CFTC that the price of silver was to be taken down regardless of what happened to the employment numbers and that the price of silver would end up below $15 per ounce. Over the next couple of days, the price of silver was indeed taken down from $16.17 per ounce down to a low of $14.62 per ounce.
Because of Maguire’s warning, the CFTC was able to watch a crime unfold, right in front of their eyes, in real time.
So what did the CFTC do about it?
Nothing.
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RE: US Bankers control USA - 4/16/2010 7:45:59 PM
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prophet
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“And the banks — hard to believe in a time when we’re facing a banking crisis that many of the banks created — are still the most powerful lobby on Capitol Hill. And they frankly own the place.” – Senator Dick Durbin 2009
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RE: US Bankers control USA - 4/16/2010 7:49:17 PM
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prophet
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Anything new here?
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http://news.yahoo.com/s/ap/20100416/ap_on_bi_ge/us_sec_goldman_sachs_charged_18
SEC accuses Goldman Sachs of civil fraud
WASHINGTON – The government has accused Goldman Sachs & Co. of defrauding investors by failing to disclose conflicts of interest in mortgage investments it sold as the housing market was collapsing.
The Securities and Exchange Commission said in a civil complaint Friday that Goldman failed to reveal that one of its clients helped create — and then bet against — subprime mortgage securities that Goldman sold to other investors.
The SEC said the fraud, a blow to the reputation of Wall Street's most powerful firm, was orchestrated in 2007 by a Goldman vice president then in his late 20's. The employee, Fabrice Tourre, has since been promoted to executive director of Goldman Sachs International in London.
Tourre, the SEC said, boasted to a friend that he was able to put such deals together as the mortgage market was unraveling in early 2007.
In an email to the friend, he described himself as "the fabulous Fab standing in the middle of all these complex, highly leveraged, exotic trades he created without necessarily understanding all of the implications of those monstrosities!!!"
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RE: US Bankers control USA - 4/16/2010 10:17:06 PM
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GroupW
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Of the various issues you've raised, this is probably the one that's most legitimate.
Goldman had a securities shelf named "Abacus" that did CDOs based on subprime mortgage securities. It appears that a hedge fund approached GS about doing a CDO based on some of the deals likely to perform poorly. That in and of itself wasn't so bad, but then GS packaged up the security and sold to Investors based in the claim that the securities for Abacus were selected by an objective and independent third party.
It's that last part that's likely to get them in trouble, because the third party (the hedge fund) was neither objective (it had a bias toward picking the bad deals because it wanted to sell them short) nor independent (GS also wanted to sell those names short).
GS essentially created the whole structure to facilitate a clients position (perfectly legal) buy sold it to Investors based on knowingly false statements.
The SEC seems to be focused on just this transaction. Whether or not this practice was followed in other deals remains to be seen but at this point seems unlikely.
That's pretty much the scoop.
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RE: US Bankers control USA - 4/18/2010 7:27:20 PM
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prophet
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quote:
ORIGINAL: GroupW
Of the various issues you've raised, this is probably the one that's most legitimate.
Goldman had a securities shelf named "Abacus" that did CDOs based on subprime mortgage securities. It appears that a hedge fund approached GS about doing a CDO based on some of the deals likely to perform poorly. That in and of itself wasn't so bad, but then GS packaged up the security and sold to Investors based in the claim that the securities for Abacus were selected by an objective and independent third party.
It's that last part that's likely to get them in trouble, because the third party (the hedge fund) was neither objective (it had a bias toward picking the bad deals because it wanted to sell them short) nor independent (GS also wanted to sell those names short).
GS essentially created the whole structure to facilitate a clients position (perfectly legal) buy sold it to Investors based on knowingly false statements.
The SEC seems to be focused on just this transaction. Whether or not this practice was followed in other deals remains to be seen but at this point seems unlikely.
That's pretty much the scoop.
Pretty much the same as this one....
quote:
quote:
Goldman Sachs’s sale of mortgage-backed securities, its requests to the credit-rating companies for the highest rating while betting the securities will later fail.
“It sounds to me a little bit like selling a car with faulty brakes and then buying an insurance policy on the buyer of those cars,” Angelides told Blankfein. “It doesn’t seem to me that that’s a practice that inspires confidence in the markets."
One single word to describe GS and bankers action - MANIPULATION
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RE: US Bankers control USA - 4/18/2010 7:28:43 PM
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prophet
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http://www.nytimes.com/2010/04/17/business/17nocera.html?src=busln
In December, Gretchen Morgenson and Louise Story of The New York Times exposed the role that some firms, including Goldman Sachs and Deutsche Bank, played in putting together investment structures — synthetic C.D.O.’s, they were called — that were primed to blow up. They did so, reportedly, because some savvy investors wanted to go short the subprime market.
On Friday, the Securities and Exchange Commission dropped the hammer, charging Goldman Sachs with securities fraud for its purported failure to disclose that the bonds that were the basis for one particular synthetic C.D.O. had been chosen by none other than John Paulson, the billionaire hedge fund investor, who was shorting them.
Manipulation
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RE: US Bankers control USA - 4/19/2010 10:56:15 PM
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GroupW
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A little background on that for the curious (or the perpetually bored / easily entertained).
Whenever someone sells a security, there has to be a buyer on the other side of the trade. For people who want to short an entire market, that creates a problem - namely that if you want to sell a LOT of a certain type of security all at once, you have to find a person who is willing to buy a whole lot of those exact same securities all at once. In a normal subprime MBS market, that's pretty difficult to do.
Enter GS and "Abacus". GS created a CDO composed of insurance contracts that someone wanted to sell. That CDO was sold to a number of investors, thereby raising enough cash to buy the contracts that the short seller wanted to sell.
Essentially GS used what was then a liquid market for CDOs to raise enough cash to be the "megabuyer" that the short sellers needed in order to sell the bonds they didn't like.
There is nothing wrong with that per se. All securitizations are nothing more than complex ways to sell assets you don't want to own for one reason or another.
Where GS seems to have crossed the line is on disclosure - while what they did was legal, they had an ethical duty to explain the nature of the deal. Instead, they sold it to buyers by claiming the portolio was selected by an independent and objective third party - obviously not true.
Oddly enough, while unethical it may have been legal at the time. The jury is still out on that one.
BT
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RE: US Bankers control USA - 4/20/2010 7:22:44 PM
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prophet
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Overview: Here is how the ABACUS trade works. Goldman takes a reference portfolio (an example portfolio of bonds, none of which Goldman actually has to own) and uses the performance of that portfolio as the basis for performance of the various securities being offered. The structure of this transaction is just like other securitizations: each set of bonds is senior to all the bonds below it and they get paid off in order of their seniority. For example, the First Loss will take losses before Class L, and Class L will take losses before Class K. The selection of the reference portfolio, and improper disclosures surrounding how it was picked, are the main topic of the SEC complaint against Goldman in the ABACUS 2007-AC1 transaction. Unlike that transaction, this one doesn't have a third-party collateral manager -- all roles here are assumed to be Goldman.
It's important to note that 92% of this transaction is expected to be rated AAA. That's right, 92%! Why so much? Well, the entire reference portfolio is rated single A, which is obviously considered safer than some of the collateral backing other transactions. The ABACUS 2007-AC1 transaction, which the SEC has targeted, for example, was backed by lower-rated BBB bonds. Only 79% of that transaction was rated AAA.
http://www.huffingtonpost.com/dear-john-thain/inside-a-goldman-sachs-ab_b_543145.html
All roles assumed by GS? Its like playin monopoly on your own....
Its called manipulation
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RE: US Bankers control USA - 4/20/2010 7:26:42 PM
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prophet
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Goldman Sachs was charged with fraud last week by the Securities and Exchange Commission. The investment bank says the charges are “unfounded in law and fact.” Regulators allege “Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio, while telling other investors that the securities were selected by an independent, objective third party,” SEC Enforcement Director Robert Khuzami said in a statement. In other words, Goldman and a hedge fund client put together a ball of sub-prime **** designed to fail and bet against it. Goldman also took out insurance on those same mortgage backed securities from AIG–yes, the same AIG taxpayers bailed out to the tune of $180 billion. Goldman was paid a total of nearly $13 billion from AIG at the direction of Treasury Secretary Tim Geithner. What a mess and it is going to get much worse before it gets better.
Plaintiff attorneys are preparing for a deluge of future lawsuits written about in this recent Reuters article: The SEC’s charges against Goldman are already stirring up investors who lost big on the CDOs, according to well-known plaintiffs lawyer Jake Zamansky. “I’ve been contacted by Goldman customers to bring lawsuits to recover their losses,” Zamansky said. “It’s going to go way beyond ABACUS. (name of Goldman security in question) Regulators and plaintiffs’ lawyers are going to be looking at other deals, to what kind of conflicts Goldman has.” (Click here for the full Reuters story.) Also, the UK and German governments are asking for their own investigation into Goldman Sachs deals.
If you think this was the only shady deal dreamed up by Wall Street banks, you have another thing coming. All of the big banks have been selling securities called derivatives for at least two decades. Derivatives are usually bundles of debt. There are derivatives for mortgages, car loans, credit cards, student loans and all types of government debt, to name a few. Derivatives are complex, but when it comes right down to it, you can sum them all up as debt bets.
Derivatives are a $600 trillion market according to the Bank of International Settlements. (Some say the BIS estimate of the derivatives market is actually more than $1,000 trillion!) And here is the best part–derivatives are totally unregulated. That means there are no standards, no guarantees and no public markets. With no public market, there is no real way to price this kind of Wall Street alchemy. You just have to trust the person selling the “security.” Take the Goldman fraud case, for example. If there was a public market, Goldman would have never been able to pack **** loans into a security and sell them. The regulation and guarantees would not have allowed it. After all, regulations, guarantees and a public market make selling derivatives a lot less profitable. That’s why Wall Street has been fighting regulation of the derivatives market for years.
http://usawatchdog.com/fraud-it%E2%80%99s-much-bigger-than-goldman-sachs/
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RE: US Bankers control USA - 4/20/2010 9:57:38 PM
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GroupW
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quote:
ORIGINAL: prophet
Pretty much the same as this one....
quote:
quote:
Goldman Sachs’s sale of mortgage-backed securities, its requests to the credit-rating companies for the highest rating while betting the securities will later fail.
“It sounds to me a little bit like selling a car with faulty brakes and then buying an insurance policy on the buyer of those cars,” Angelides told Blankfein. “It doesn’t seem to me that that’s a practice that inspires confidence in the markets."
One single word to describe GS and bankers action - MANIPULATION
Actually not the same. There is a small but critical distinction. In this case re: abacus 2007 AC1, the issue isn't the short sale, it's allowing a short seller to choose the bonds and then telling everyone buying the CDO that the portfolio was selected by an independent and objective third party.
You can do what GS did - but you can't lie about it. There is the rub.
_____________________________
“For every problem, there is a solution that is simple, elegant and wrong.” -H.L. Mencken
"Most people would rather die than think; in fact, they do so." -Bertrand Russell
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RE: US Bankers control USA - 4/20/2010 10:04:30 PM
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prophet
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quote:
ORIGINAL: GroupW
quote:
ORIGINAL: prophet
Pretty much the same as this one....
quote:
quote:
Goldman Sachs’s sale of mortgage-backed securities, its requests to the credit-rating companies for the highest rating while betting the securities will later fail.
“It sounds to me a little bit like selling a car with faulty brakes and then buying an insurance policy on the buyer of those cars,” Angelides told Blankfein. “It doesn’t seem to me that that’s a practice that inspires confidence in the markets."
One single word to describe GS and bankers action - MANIPULATION
Actually not the same. There is a small but critical distinction. In this case re: abacus 2007 AC1, the issue isn't the short sale, it's allowing a short seller to choose the bonds and then telling everyone buying the CDO that the portfolio was selected by an independent and objective third party.
You can do what GS did - but you can't lie about it. There is the rub.
thats lying......
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RE: US Bankers control USA - 4/20/2010 10:53:37 PM
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GroupW
Posts: 2996
Joined: 11/16/2007
From: Up in the hills of Colorado (very BIG hills...)
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Exactly my point.
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“For every problem, there is a solution that is simple, elegant and wrong.” -H.L. Mencken
"Most people would rather die than think; in fact, they do so." -Bertrand Russell
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RE: US Bankers control USA - 4/20/2010 11:10:05 PM
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prophet
Posts: 798
Joined: 4/19/2005
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quote:
ORIGINAL: GroupW
Exactly my point.
quote:
Logged in as: prophet
Thanks for the clarification.
So, is manipulation okay if you dont lie? 
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Create in me a Clean Heart, O Lord.
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RE: US Bankers control USA - 4/23/2010 8:23:03 PM
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prophet
Posts: 798
Joined: 4/19/2005
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Watch this space, maybe more to come?
http://dealbook.blogs.nytimes.com/2010/04/23/conflict-of-interest-for-goldman-in-lloyds-deal/
Conflict of Interest for Goldman in Lloyds Deal?
Goldman Sachs was involved as an underwriter and an investor in the Lloyds Banking Group’s £23.5 billion ($36.1 billion) refinancing in late 2009, The Financial Times reported, citing four people involved in the capital raising.
According to the newspaper, Goldman demanded last-minute changes to the structure of the transaction, which ended up benefiting Goldman’s position as a bond investor, even though bankers at Goldman say the company’s ethical walls bar underwriters from knowing how its proprietary traders invest.
Citing people involved in the Lloyds refinancing, the newspaper said Goldman disagreed with a consensus of other banks on the amount of extra interest to be payable on bonds that were to be exchanged for new ones.
It also said Goldman was involved in discussions about which bonds should be a priority for the exchange offer, and cited four people close to the deal in saying Goldman was a large investor in a 6.9 percent bond that was top-ranked.
The Financial Times reported:
Goldman’s role in the transaction – both the alleged conflict of interest and the allegation that it helped make the terms more expensive – will be sensitive, given the UK government owns 41 per cent of Lloyds. Lloyds would not comment on the advice it received but said: “The final decision on the terms and pricing of this offer was made by the group following the recommendation of the syndicate, and not any one bank.”
Goldman would not comment to The FT on the issue.
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Create in me a Clean Heart, O Lord.
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RE: US Bankers control USA - 4/23/2010 9:54:37 PM
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prophet
Posts: 798
Joined: 4/19/2005
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http://www.ghanaweb.com/GhanaHomePage/NewsArchive/artikel.php?ID=180487
Goldman Sachs, the global financial institution, with fraud allegations levied against it has a long history of setting up its clients for a fall...and making handsome profits.This is a story of how this global investment banking and securities firm screwed Ghana
In 1998, Ashanti Gold was the 3rd largest Gold Mining company in the world. The first "black" company on the London Stock Exchange, Ashanti had just purchased the Geita mine in Tanzania, positioning Ashanti to become even larger. But in May 1999, the Treasury of the United Kingdom decided to sell off 415 tons of its gold reserves. With all that gold flooding the world market, the price of gold began to decline. By August 1999, the price of gold had fallen to $252/ounce, the lowest it had been in 20 years.
Ashanti turned to its Financial Advisors - Goldman Sachs - for advice. Goldman Sachs recommended that Ashanti purchase enormous hedge contracts - "bets" on the price of gold. Simplifying this somewhat, it was similar to when a homeowner 'locks in' a price for heating oil months in advance. Goldman recommended that Ashanti enter agreements to sell gold at a 'locked-in' price, and suggested that the price of gold would continue to fall.But Goldman was more than just Ashanti's advisors. They were also sellers of these Hedge contracts, and stood to make money simply by selling them. And they were also world-wide sellers of Gold itself.
In September 1999 (one month later), 15 European Banks with whom Goldman had professional relationships made a unanimous surprise announcement that all 15 would stop selling gold on world markets for 5 years. The announcement immediately drove up gold prices to $307/ounce, and by October 6, it had risen to $362/ounce.
Read on.....
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