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Apr. 27 2010 - 8:48 am | 6,558 views | 6 recommendations | 122 comments

Palin on Goldman

One, called Hudson Mezzanine, was put together in the fall of 2006 expressly as a way to create more short positions for Goldman, the subcommittee claims. The $2 billion deal was one of the first for which Goldman sales staff began to face dubious clients, according to former Goldman employees.

“Here we are selling this, but we think the market is going the other way,” a former Goldman salesman told The New York Times in December.

via Goldman Said to Have Been in Other Mortgage Deals – NYTimes.com.

So today is the big day. Lloyd “God’s Work” Blankfein and Fabrice “Fabulous Fab” Tourre are going to be dragged before the Senate and formally introduced to America via the medium of a hearing of the Senate Permanent Subcommittee on Investigations.

It’s hard to get a read on just exactly what this is all about. I hear conflicting things. On the one hand, one always has to keep in mind that Congress has a history of dragging current news-cycle villains into their arena to get video-whipped for purely political reasons — think the Mark-McGwire-weeping steroid hearings. And certainly the impending vote on the Financial Regulatory Reform bill is an important and very obviously related subplot to the Goldman investigation. So politically there are all sorts of reasons for the Senate to do this now.

The Democrats have a lot to gain by hauling in God’s Work and the Fab to be tarred and feathered. Politically, the most important thing from their point of view is to corner the Republicans politically, showing the country that these evil assholes testifying are the same people who have been sending armies of lobbyists to Washington to kill the Regulatory Reform bill, the same bill that the Republicans are trying to block debate on.

The Republicans, meanwhile, are in the difficult position of trying to sell Wall Street’s position on the Regulatory Reform bill to their base. That might not sound so very difficult, given that the Tea Partiers in particular continue to oppose further government regulation and have used the idea that Barack Obama’s government is “taking over the banking sector” as a rallying cry. But Wall Street isn’t exactly popular with the Tea Party, either, so selling their side of the debate on this bill is a bit of a sticky thing.

Leave it to Sarah Palin to come  up with the solution. This is from a post on her Facebook page. I advise everyone to read it, since it’s a highly amusing  piece of propaganda:

The current debate over financial reform demonstrates what happens when political leaders react to a crisis with a raft of new regulations. First off, the people involved in writing government regulations are often lobbyists from the very industry that the new laws are supposed to regulate, and that’s been the case here. It should surprise no one that financial lobbyists are flocking to DC this week. Of course, the big players who can afford lobbyists work the regulations in their favor, while their smaller competitors are left out in the cold. The result here are regulations that institutionalize the “too big to fail” mentality.

Moreover, the financial reform bill gives regulators the power to pick winners and losers, institutionalizing their ability to decide “which firms to rescue or close, and which creditors to reward and how.” Does anyone doubt that firms with the most lobbyists and the biggest campaign donations will be the ones who get seats in the lifeboat? The president is trying to convince us that he’s taking on the Wall Street “fat cats,” but firms like Goldman Sachs are happy with federal regulation because, as one of their lobbyists recently stated, “We partner with regulators.”

Sometimes it’s hard not to admire Sarah Palin. You need to have a pair of iron church bells swinging between your knees to pull off a crazy line like this, and she does it almost effortlessly. If you’re scoring at home, the idea here is that banks like Goldman actually want this regulatory bill because it will allow them to “partner with regulators,” i.e. team up with the government, to dominate the economy. This is despite the fact that Washington is currently flooded with financial services industry lobbyists who, in an attempt to kill this bill, are practically lugging suitcases full of money around to throw at the likes of Ben Nelson and Mitch McConnell.

The awesome thing about this is that it’s almost guaranteed to work with the people Palin is targeting. The Democrats here are going to suffer, deservedly so, for having taken so much money in the past from Goldman and banks like Goldman. That fact now allows transparent bullshitters like Palin — who incidentally supported the bank bailouts — to credibly argue that this Regulatory Reform bill is an industry creation. It doesn’t hurt that the Democrats’ last major piece of legislation, the Health Care bill, actually was a monstrous giveaway to industry that allowed campaign contributors to appropriate the power of the state to extract profits from ordinary people.

This Regulatory Reform bill is not that, but if you’re a Tea Partier, what about the past history of the Democrats would lead you to believe otherwise? Thus Carl Levin can get up there and roar all he wants at Lloyd Blankfein today, but the way this is going to play to a good 30% of the electorate is that the Democrats and big Lloyd are putting on a dog-and-pony show in order to smooth the way for the next chapter in their world domination plan. Hell, even writing that right now, I’m starting to believe it myself.

The reality, of course, is that this is a make-or-break moment for Goldman, Sachs. It just may be that the Democrats, after years of intimate partnership with this firm, have finally decided to “go in a different direction” and cut Goldman loose, purely for political reasons. A close friend of mine from Russia points out that there are parallels here to Putin’s ascension to power, when a rookie president pushed into his seat by a gang of oligarchs decided upon election to whack the most obviously odious of the bunch — Bank Menatep’s Mikhail Khodorkovsky — in order to firm up his “reform” credentials and, politically speaking, put himself on the other side the obscene corruption of the Yeltsin era.

Maybe I’m seeing more than is actually there with this Senate business. But with all this noise now about new cases even above and beyond Abacus, it is sure beginning to sound like someone has decided to make an example out of Goldman Sachs.

p.s. Palin, of course, isn’t completely wrong about the concept of “institutionalizing the too-big-to-fail” mentality. As originally conceived by Tim Geithner, the bill would have done exactly that, bailing out top-25 banks with taxpayer money and then only later (and without a specific timetable) getting Wall Street to foot the bill for bailouts. But the newer version makes Wall Street pay up front into a bailout fund. Of course the bill in its entirety is nothing to write home about (see Nomi Prins’s take on the subject), but what little good stuff is in the bill is only there in spite of Wall Street’s lobbying. In other words, the Goldmans of the world would have preferred no bill at all and are still trying to water it down as much as possible. Palin meanwhile is selling it as something Goldman actually wants, a new Obama-Goldman gouge job,  in order to increase its market advantage over smaller competitors.  It’s clever, you have to admit.


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  1. collapse expand

    Keep up the good work we need more of fact finders like you who are building up readership to flush out the crooks who by virtue of their positions perpetuate all that is detrimental to the political,social and economic health of this nation.By all the nefarious means at their disposal they prey on our weaknesses may that be of ignorance greed or sheer complacency.Any sense of the weakness in the system gives rise to the leadership that the system can do well without and that one should amply learn from history.Political criticism obfuscates issues and helps in confusing masses and ends up making them confused disillusional and angry at reasons that are not fundamental but contrived.

  2. collapse expand

    Now let’s see column after column and joke after joke on some truly corrupt and stupid democrats in congress….

  3. collapse expand

    Now let’s go thru carl levin’s record:

    1. voted aganist NAFTA, but voted for million dollars for michigan end of nafta highway

    2. Pro abortion, pro partial birth abortion

    3. He’s against energy production

    4. Voted for CAFE standard which hurt michigan jobs

    5.He is a big conspiracy nut on oil price fixing

    6. He voted for higher gas prices

    7. He is against guns unless they are used to protect his own ass at taxpayer expense

    8.He voted for amnesty so illegals can legally steal all of america’s jobs

    9. He has been in politics for 40 years sucking off of the taxpayers…..

    6.

  4. collapse expand

    To Oral B…might I add Ninny to your speculation…this site is full of named names, it prides itself in that…it’s just that you have haughtiness up your ass…are you really in Renton?

  5. collapse expand

    The Huffington Post had an interesting item yesterday about a strip club in Chicago that is going to have a Sarah Palin look-alike and strip contest on a day in May when she will be there to give a speech. Now that should be interesting since since she is so hot. Well , partly hot, since her viper-like attitude would have a tendency to cause male detumescence…Anyways, the slogan of that strip soirée is “Less taxation, more stimulation”… :)

    Marco

  6. collapse expand

    All this circular thinking without any actual thinking. i am suprised palin can wink without closing both eyes.

  7. collapse expand

    Imagine the boost from that stripper contest…stripper club types will just remember the good show on election/erection day!
    Votes will come like zombies raising from the dead! We all know the voting proclivities of the American Pubic cannot be underestimated. Let the show go on!

  8. collapse expand

    Hey Matt,

    I’m sure by now you’ve read milquetoast pseudo-liberal Michael Kinsley’s inevitable “specter of anti-semitism” article, but I thought his appearance on Talk of the Nation was particularly entertaining because they discussed you and what Kinsley implied was your at-least-negligent-if-not-knoiwing. “worrisome” anti-semitic symbolism in detail at the beginning of the program, identifying you as the very Arab-sounding Matt “Tabibi” (as in habibi). Interview here:

    http://www.npr.org/templates/story/story.php?storyId=126310251

    In any case, it was inevitable that someone would try to defend Goldman using the anti-semite card when no one is even talking about ethnicity, but I thought that interview was particularly hilarious with the convenient mispronunciation of your name to fit the context.

    • collapse expand

      Didn’t GS claim anti-semitism and invoke Matt’s last name last summer, when the ball got rrolling? And then when the SEC charges came out, they cried anti-semitism again? They are definitely grasping at straws. Also, I remember Matt recounting his heritage last summer, and an Arabian background wasn’t in it.

      Maybe Goldman is feeling “on the ropes” even as their stick is rising – and I wanna know who’s betting on them! It’s like The Color of Money meets Other People’s Money.

      In response to another comment. See in context »
      • collapse expand

        I actually don’t remember that they did, but it’s not like I would be surprised – you sort of expect someone to see the discrimination that isn’t there. Especially when blood sucking and vampire metaphors come out.

        Still, yeah, you would have to sort of assume that this is a convenient marriage of Kinsley’s bizarro contrarianism – wherein he takes on anyone who is championing anything that would actually do good in order to show that he’s a “sensible” liberal and not interested in rocking the boat – and Goldman’s need for surrogates in the press. Whether it’s conspiratorial, I dunno, but it’s definitely not surprising that this kind of talk would get cranked up.

        In the future we are only allowed to criticize John Paulson, Fab and other non-Jewish members of Goldman Sachs just so Michael Kinsley can’t find so much as a ginned up hint of imagined anti-semitism in the criticism!

        In response to another comment. See in context »
    • collapse expand

      Hmm – this is what I get for replying before reading the interview. From the transcript, it seems more that Kinsley is saying that things said against Goldman Sachs will be construed as anti-semitic whether they are or are not, just because of 1. the history of anti-semitic rhetoric and 2. the association of Jews with banking (money lending).

      Kinsley might be choosing this tactic to play both sides of the fence – saying he doesn’t feel the attacks are ethnically motivated while invoking the religion card – but that doesn’t come through in the transcript. His comment on the “great vampire squid wrapped around the face of humanity relentlessly jamming its blood funnel into anything that smells like money” reads as something not anti-semitic but something that Taibbi should not have been surprised would smell of anti-semitism. So Kinsley’s kind of grasping at straws as well.

      In response to another comment. See in context »
      • collapse expand

        Yeah, that’s sort of what I meant. There’s no anti-semitism there and he’s carefully saying that while there’s no anti-semitism there, there may actually be some there. So, this kind of talk (criticizing bankers who work for a historically Jewish firm who may or may not be Jewish) could be misconstrued and used by anti-semitic people to inflame discrimination against Jews and that Matt Tabibi (he expressly says this) knew what he was doing in raising the spectre of anti-semitism because when he said that he had no intention at all of even remotely commenting on the topic of anti-semitism that was the sign that he was obviously aware that he was being secretly anti-semitic.

        Kinsley’s entire argument, boiled down, is basically “don’t criticize Goldman because some people might think you hate Jews.” It’s functionally retarded, but exactly the kind of thing that America’s functionally retarded media would love to spend a day or two analyzing and genuflecting about.

        (thanks for the Jon Stewart link!)

        In response to another comment. See in context »
  9. collapse expand

    Called it in the last thread:

    “The SEC filed its charges after months of discussions with the bank over the claims. However, sources said the agency pulled the trigger on suing the bank out of frustration for what it saw as Goldman dragging its feet toward a resolution.”

    http://www.nypost.com/p/news/business/settlement_day_tKZx6qL2xcbz4MX4xW9oAL#ixzz0mUu4GycX

  10. collapse expand

    From the same piece in the NYPost:

    “One source refuted the notion that Goldman had a chance to settle the claims before the SEC sued, adding the agency “took the unprecedented step of filing its lawsuit against a public company in the middle of the morning while the stock was still trading.”

    THAT … is positively Nixonian. GS putzkies around for months and months, in the face of investigation, contacts from enforcement, the House passing a bill, appointment of new sheriffs to the SEC, months of news articles about Dodd huddling with Corker, even a freakin’ warning from the SEC — and THIS GS insider source is peeved because by the time the Southern District’s filing office opened, everyone at GS was fully occupied huddled over their Bloombergs raping and pillaging the few outposts of the economy yet left standing.

    Evidently the SEC is to blame, for not making it sufficiently clear to the masters of disaster that when it said it was serious, it meant it.

  11. collapse expand

    I enjoy Taibbi’s pieces, but I am so tired of Palin. I just don’t see that she has any credibility. She is not a long time conservative intellectual, she is a circus act. Why are we lending any credibility to her on these issues?

    We know she is a train wreck and I don’t need to demonize her anymore. I find it only makes the fringe double down and become more fervent and devotional. I just want quality and true intelligence and civility from commentators and she just isn’t that. Old time conservative intellectuals could support and criticize both sides of the aisle. Her act is just getting old and tiresome. Let’s ignore her and ask for more from the right wing than that.

    • collapse expand

      I agree with you that she doesn’t have any credibility but I can tell you that many people here in Wichita are absolutely giddy about her upcoming appearance on May 2. The event is purportedly only a fundraiser for a local Christian school (according to Bethel president Ted Barney), but that sure isn’t how Pat Boone made it sound on B98 radio this morning. Boone is going to emcee the event. He said when he was approached, he was told it would be a tea party event in Wichita, Kansas. He likened Sarah Palin to the biblical Deborah, who stepped up when the men were too timid to lead. Around here, plenty of people do think she is credible and all kinds of other great stuff.

      After the elections *cough* of George W. Bush, I will never again underestimate the power of charisma on a stupid electorate. We can’t afford to assume that just because we think/know she’s a cynical fraud, that she will just fade away if we ignore her.

      My first thought – too, also, and as well – was that Sarah Palin did not write that Facebook post herself.

      In response to another comment. See in context »
  12. collapse expand

    Saw your piece on Big Ben in that Boston paper I picked up this past weekend. It was my first time driving around Boston and it’s very clear the road system is designed to fuck with the minds of everyone not from Boston. How can roads just go in five directions with no signs? I’m from Pittsburgh so I know that any given left turn can take you under a river, but Boston is even nastier…they get you on bridges where you can see where you should be and are completely powerless to get there.
    The Big Ben piece…I loved it when Terry Bradshaw told Ben to wear a helmet on the bike and Ben told him to fuck off. Rothlisberger needs to go to Oakland because the Heinz Ward types aren’t going to keep quiet for too long. Pittsburgh doesn’t tolerate distractions very well. Ask Barry Bonds. Ben’s press conference left Pittsburgers with wtf? Not enough! But you nailed the sentiment very well.

  13. collapse expand

    um, no…Palin distracts…there is no one dumber to do it, so she takes the helm. But this scarcely conceals the BushCo int’l. economic initiative – a nefarious doctrine executed by Paulson’s pals to export debt, defrauding all sovereign comers with cds paper and swap promises with no prudent reserves whatsoever, …ergo, Greece falls today, Spain & Portugal tomorrow, and there will be no currency left but the Allmighty dollar. (It takes time to print 600 trillion dollars to back cds debt.) Paulson’s Treasury couldn’t even keep up with the demand! Why do you think we’ve re-designed the Benjamin? Over 60 per cent of the American people think the current crises are Bush’s fault – they’re not wrong, you know. They are not as stupid as Palin. Palin is an idiot quitter with no creds whatsoever other than RACISM & she’s far out of all proportion to her net value. Ineffective and uninformed.

  14. collapse expand

    I thought some of you might find the following item interesting:

    Anthropologist Explores Wall Street Culture

    40,000 AT&T workers lost their job. This sounds like terrible news. But the stock market applauded it, sending AT&T shares up. Why? Anthropologist Karen Ho was fascinated and confused by the different reactions and wrote her dissertation about it. In July, her book Liquidated: An Ethnography of Wall Street will come out.

    Ho went on fieldwork as a business analyst to “learn the language of finance.” She interviewed hundreds of people, shadowed investment bankers at work and hang out with them at bars and industry conferences. “Today, amid Wall Street’s biggest crisis since the 1930s, her insights are fascinating for investors and regulators alike”, Kara McGuire writes in the Star Tribune.

    McGuire interviews the anthropologist and asks questions like “How are investment bankers different from the rest of us?” That’s the way, I think, the members of finance or wall street culture should be treated. They seem to live in a totally different world than most of us, a world with their own logic. They seem to represent a totally different culture.

    Karen Ho answers:

    Investment bankers are structured toward the next bonus. They’re compensated on how many deals they can push through, not on the quality of the deals or long-term strategy. Investment bankers have tons of job insecurity; they are a total revolving door. But what’s interesting is that because of their fairly elite biographies and kind of privileged networks they move in, as well as their lavish compensation, the way they experience downsizing is very different from that of the average worker.

    One of the things I argue in the book is that they cultivate a culture of liquidity, of continual restructuring and downsizing that they understand from their particular cultural point of view and privileged location as a productive challenge, as a building of character, precisely because their cushion is so thick. They can say, “Hey look, I have a really risky job, but that’s why I just got paid $1 million last year.” They’ll actually recommend this kind of churning for other workers who have a very different experience. This actually affects corporate America, how other industries are operating.

    In her forthcoming book, she focuses on a cultural shift in finance. One of the main ideas of the book is to figure out how short-term shareholder value became the undisputed mission of most corporations from the 1980s onward:

    Throughout the mid-20th century, Business Roundtable leaders would say: “Our mission is to negotiate the long-term interests of multiple stakeholders – consumers, employees, distributors, as well as the shareholder.” After 1980, it’s: “We don’t have to negotiate all these other interests; we just have to be concerned about the shareholder.”

    The corporate takeover movement Wall Street led in the 1980s helped to culturally make that shift so CEOs now imbibe that Wall Street mantra. (…) Corporations get rewarded and investment bankers get rewarded for financial dealmaking that actually does not increase productive capability.

  15. collapse expand

    What marco seems to be getting around to is that in post-industrial America (Or, should I use Amerika?) money has become the product, i.e., it must be produced in and for itself. Therefore, all activities concerning the making of it are OK because they just create more money…for someone or another. As long as you are not outright stealing it, it’s OK to manipulate it.
    They must be thinking along lines like that…of course, there is also the case for these being modern day pirates akin to those who waged war on the Spanish Main…
    Add to all this the fact that just due to population huge sums can grow from small amounts garnered one way or another from the masses. Sort of like taxes, eh? But no refunds here…

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    I'm a political reporter for Rolling Stone magazine, a sports columnist for Men's Journal, and I also write books for a Random House imprint called Spiegel and Grau.

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