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2010-02-08
Paperwork Hinders Airlifts Of Ill Haitian Children

Shame And Fear: Inside Germany's Catholic Church Abuse Scandal

'Million-Fold Violation Of The Private Sphere' - Germany Consumer Minister Takes On Google Street View

Interview With Palestinian President Mahmoud Abbas: 'I Will Not Back Down'

Greek Debt Crisis - How Goldman Sachs Helped Greece Mask Its True Debt

Dow Closes Below 10,000 For First Time Since Nov. 4

Climate Scientists Hit Out At Melting Glaciers Error

Commentary: The Case For Climate Change Must Be Remade From The Ground Upwards

U.S. Health And Human Services Secretary Sebelius 'Very Disturbed' By Anthem Blue Cross Rate Hikes

Ahead Of SWIFT Vote: U.S. Urges European Parliament To Back Bank Data Deal

Commentary: 'The West Must Impose Sanctions On Iran This Month'

Iran's Nuclear Plans Prompt New Calls For Sanctions

U.S. Rep. John P. Murtha Dies At 77

Ukraine Remains Divided After Runoff Election

2010-02-07
Global Market Turmoil Hints That U.S. Recovery May Founder

Editorial: The Truth About The U.S. Deficit

Why Are U.S., Allies Telling Taliban About Coming Offensive?

Testy Conflict With Goldman Helped Push A.I.G. To The Edge

Survey Of Retired N.Y. Police Dept. Officers Raises Questions On Crime Data

Iraqi Militants Post Video Of Kidnapped American

In Britain: Sharp Rise In Number Of Older People With Fatal Allergies

Ukraine Set For A Tilt To The East As Russia's Ally Leads In Polls

Mitch Landrieu Wins New Orleans Mayor's Election By Landslide

Top Canadian Banks Want Government To Cool Off Rise In Home Prices

6.6 Magnitude Hits Off Japan's Southern Coast

2010-02-05
Interview With John And Doris Naisbitt: 'China Is A Country Without An Ideology'

Interview With German Economic Adviser - Euro Zone 'Could Cope With Greek Bankruptcy'

Judge Overturns Boycott Barring Iranians from Dutch Nuclear Sites

Sen. Dodd: Talks With Republicans On Financial Bill At 'Impasse'

U.S. House To Vote On Stripping Health Insurers' Antitrust Protection


How Goldman Sachs Secretly Bet On The U.S. Housing Crash
2009-11-01 14:54:28 (14 weeks ago)
Posted By: Intellpuke
(Read 1712 times || 1 comments)
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In 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers it was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting.

Goldman's sales and its clandestine wagers, completed at the brink of the housing market meltdown, enabled the nation's premier investment bank to pass most of its potential losses to others before a flood of mortgage defaults staggered the U.S. and global economies.

Only later did investors discover that what Goldman had promoted as triple-A rated investments were closer to junk.

Now, pension funds, insurance companies, labor unions and foreign financial institutions that bought those dicey mortgage securities are facing large losses, and a five-month McClatchy investigation has found that Goldman's failure to disclose that it made secret, exotic bets on an imminent housing crash may have violated securities laws.

"The Securities and Exchange Commission should be very interested in any financial company that secretly decides a financial product is a loser and then goes out and actively markets that product or very similar products to unsuspecting customers without disclosing its true opinion," said Laurence Kotlikoff, a Boston University economics professor who's proposed a massive overhaul of the nation's banks. "This is fraud and should be prosecuted."

(story continues below)




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Readers Comments
Scum
By: Anonymous
2009-11-02 07:37:59
Didn't you tell me that it's all the former goldman sach guys that are going to get us out of this financial mess? When they helped engineer it and profited off of it in the first place.

When Max Keiser said these guys were scum, he was right.



You should be concerned who Obama surrounded himself with.



Lloyd Blankfein, Goldman's chairman and chief executive, declined to be interviewed for this article.---Hmm, the guy on tiny Tim Geithner's speed dial and one of the engineers of the bailouts!!!

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