10 Sleazy Ways That Goldman Sachs Distracted Us While Pocketing Billions from the Treasury

[Joanne98]

How Goldman deftly diverted attention away from the tens of billions it has taken from the public.

The best illusionists deflect audience focus away from the heart of the trick until the final moment of revelation. The way Goldman Sachs has worked its multi-prong bailout is like that. During last week's chatter about submitting their TARP payback application, the firm deftly diverted attention away from all the real money they took from the public.

Now, I have no problem with Goldman repaying their cut of the TARP money. (note: I’m using them as an example here because they’re the best financial illusionists out there, but I could easily pick JPM Chase or others for different reasons.) Plus, I sat through enough internal earnings meetings when I was at Goldman to know that CFO, David Viniar, can make the squirrels in my backyard seem as rich as Warren Buffet.

True, most of finance is based on the ability of Wall Street to make money by convincing investors that what they’re hocking on any given day has value. Reality is as good as your best sales pitch. Which is exactly what months of PR-spun words regarding strength and TARP payback intentions are. And why they have translated into billions of dollars worth of increased firm value as investors buying their myth of health drive up the stock price, which plump the pockets of the chieftains that own the stock and options. The thing is, though, that Goldman took far more public money than their little piece of TARP. So did all the other banks. In fact, the finance sector got $7.5 trillion in loans and assistance from the FED, $1.6 trillion from the FDIC, $2.4 from the Treasury (including TARP) and another $1.5 from joint federal efforts.

But, let’s focus on the ten steps of Goldman’s big public rip-off: (Or keep $42 billion give back $10 billion and see your stock price double)

1) Enlist assistants. a) The Treasury department -- under both former Goldman Sachs CEO, Henry Paulson, and Wall Street-mentored Tim Geithner -- has worked really hard at ensuring our (and Congress’s) attention is on the measly $700 billion of TARP money that Congress approved last fall, and not on the other $12.3 trillion of cheap Fed loans, FDIC backed guarantees and other favors the banks got. And, it kept going last week, as Geithner told Congress, “While TARP is proving effective at improving the immediate stability of the financial system, the scope of the issues that the face extend beyond TARP to include striking the delicate balance between intervention and allowing market participants latitude to operate; devising a new financial regulatory structure for the future; and working through the tough problems of what form our government-sponsored enterprises, Fannie Mae and Freddie Mac, should take as we emerge from this difficult period." Translation: focus away from the Wall Street banks, while we try not to open them to any uncomfortable new restrictions.
b) The FED, which has kept a cloak of secrecy around its $7.5 trillion giveaways (they call them facilities) including which bank got what deal. This is to “protect” us from the truth.

Continued>>>
http://www.alternet.org/politics/140291/10_sleazy_ways_that_goldman_sachs_distracted_us_while_pocketing_billions_from_the_treasury/

[truedelphi]

1. K & R for reading later. And to remind myself that the 60 Billion Madoff swindled

Was only played up by the Media because it was not about one of their own.

Had Madoff been one of the top people at GS, we wouldn't even know his name.