How about
Robert Rubin - the former Goldman co-CEO who became Treasury Secretary in the Clinton administration? From that post, Rubin squashed all regulations pertaining to derivatives, and ended Depression-era laws like the
Glass-Steagall Act (which separated commercial banks from investment banks) so giant
Citicorp could be formed by the merger of Travelers and Citibank. Rubin then went to Citigroup Inc. (NYSE:
C), where he made some $119 million while leveraging the bank up with derivatives before it had to be bailed out.
Bailed out by whom? Bailed out by then Treasury Secretary
Henry M. "Hank" Paulson, himself a former Goldman CEO.
And bailed out how? With the help of the Federal Reserve Bank of New York, whose chairman was Steve Friedman, a former Goldman partner, still on Goldman's board.
That's the same Steve Friedman who bought $3 million worth of Goldman shares based on allegedly inside information he garnered at the Fed and from Goldman's board meetings, profited handsomely, and had to resign from the Fed board -- but not give any of his profits back.
And finally, Goldman itself had to be bailed out when it ran to the Fed on a Sunday in September 2008 to beg to be turned from an investment bank to a bank holding company so it could get Fed cash.
The Usual Suspects
There are innumerable connections and fascinating stories. So, I won't bore you with the one about Goldman arranging a currency swap at an apparently "fictitious" exchange rate for the government of Greece. Nor how that swap facilitated Greece hiding its debts to get into the Eurozone, so it could then borrow euros ad nauseam until it had to be bailed out - again and again.
I'm not going there. Because if I did I'd have to get into how precariously positioned the new "technocrats" -- who are supposed to save Italy with the help of the ECB -- actually are.
And who are they?
Well, there's
Mario Draghi, the new president of the ECB. Super Mario, it turns out, was Vice Chairman and Managing Director of Goldman Sachs International, and a member of the firm-wide management committee from 2002 to 2005. He claims to have not been responsible for the Greek currency swap, saying it was arranged before he went to Goldman. But he's never denied it.
That's comforting.
If he runs the ECB the same way Goldman runs its business, there might be some areas where transparency may not be the order of the day. And isn't that exactly what a central bank is supposed to be about?
If I had more time here I'd mention that
Mario Monti, prime minister-designate of Italy, not only was a European Commissioner, but an international adviser to Goldman Sachs.
I'm just comforted to know that these old buddies are all still manipulating global finances for the betterment of our interests and the Goldman bonus pool this fiscal year or next.
Customer Service
I'm also not going to get into how Goldman set American International Group Inc. (NYSE:
AIG) up to fail, or how the New York Fed made the firm whole on the credit default swaps it had written on AIG. Nor will I get into how Goldman board member
Rajat Gupta allegedly passed along boardroom secrets to his friend and Goldman customer
Raj Rajaratnam (now serving time for insider trading), or how the Justice Department is looking into how Goldman teed-up millions of investors and hit a hole in one when the mortgage market failed and they were short.
I'm only going to point to one small incident that proves Goldman really does have the interest of its clients at heart.
Back in 2007 Goldman constructed a little billion-dollar deal for a customer named
John Paulson. Only the firm didn't tell its other customers, the ones to which it sold the Paulson deal known as Abacus 2007-AC1, that the deal was designed to fail.
Paulson made out like a bandit because he bet against the deal. Now that's good customer service.
Goldman didn't admit any wrongdoing and paid a paltry $550 million fine, which in terms of its 2009 earnings amounted to 15 days worth of register ringing.
So, let me get this right: Goldman, and the rest of its big bank brethren, are all about their customers. And they want their customers to go to bat for them with the regulators.
I suppose it was those nasty regulators that caused the whole credit crisis and the Great Recession in the first place.
And I guess that means that if Goldman, with the help of its customers, can get all those pesky regulators out of the way, we'd all finally be free to do business and live happily ever after - especially Goldman and the rest of big banks, of course.
Comité de Inversiones Extranjeras: "La disputa entre Codelco y Anglo no afectará la tendencia de la inversión"
