Goldman Sachs: The Old Fashioned Way

Goldman Sachs, the Wall Street firm often derided as Masters of the Universe for their seeming ability to make money no matter what the economic climate, have been indicted for the Securities and Exchange Commission (SEC) for fraud.

The details of the case are complex but essentially boil down to Goldman encouraging investors to buy collateral debt obligations that they themselves were betting against. It also seems that they aided and abetted the run up of these financial instruments even as they were creating a climate for their ultimate collapse. Involved, but not charged, John Paulson, an investor who profited from the scheme, appears to have directed Goldman in this effort.

Goldman Sachs is already proclaiming its innocence. Some opinions suggest that the case may be so convoluted that it may be difficult to prosecute before a jury. Others suggest that it is just the tip of the iceberg.

Important in this discussion is how they were able to even conceive of such a scheme. In therapy, medical practice, social services, etc. professionals are taught to avoid even the appearance of impropriety. In the case of bankers, apparently the rules are to obfuscate everything and rely on the investors not asking questions.

This is the free market in action. Take the suckers for all they have. Goldman Sachs has not even attempted to defend its actions as ethical or even above board. When your defense is that the case will be hard to prove in court, there seems to be an admission of improper behavior.

As I write this, Goldman just announced record profits for the first quarter. Goldman Sachs: making money the old fashioned way - stealing it.