I woke up this morning to the news that the SEC is charging Goldman Sachs with fraud. Whoopeedoodle. In October of 2008, I wrote a piece based on a WSJ article about the FBI opening preliminary investigations into 26 banks. Anybody heard a peep about it since? The last article I saw was the investigation of BofA over Merrill Lynch in September, 2009.
The average American may think this is great news if they were really paying attention and had all the facts. An SEC charge against Goldman Sachs is more deflect and distract.
TurboTax Timmie (and some say Hank Paulson) was in China begging for cash. Reports of Bill Clinton secretly heading over to Japan for cash, Barack Obama bowing to the chinese a couple weeks after a secret trip to Afghanistan(and God knows where else), and then this little story from MarketTicker that you may have missed in the all the tea party bashing going on the last two weeks.
Did The Fed Just (Surreptitiously) Bail Out Europe? (Monday, April 12th, 2010)
No, not just Greece – all of Europe. Without Congressional authorization or notice, of course.
Hattip to a nice emailer….
Or if you prefer it on a one-year time scale…
That nice little vertical line is a gain of $421.8 billion dollars of outstanding loans and leases in one week’s time.
WHERE THE HELL DID THAT MONEY GO AND WHAT COLLATERAL WAS TAKEN AGAINST A FOUR HUNDRED BILLION DOLLAR INCREASE IN OUTSTANDING LOANS?
You won’t find anything like that in the records – because it’s never happened before. That’s beyond unprecedented, it’s ridiculous, and assuming it’s also accurate, someone has some ‘splaining to do on what clearly appears to be some sort of back-door game being run.
Update: It has been suggested that this may be related to the FASB changes and securitized loans coming back on the balance sheet. If so, where’s the alleged memorandum items on the other side and the footnote on FRED? The latter is missing, but the necessary data on FRED to confirm that is not yet updated.
Nonetheless, if this is the case, it’s still bad (just not catastrophic) as this will directly hit capital ratios. Or, put another way, where’s the additional capital that “should” be there to support what is now on balance sheet and was previously off (never mind that it was crooked as hell to have it off in the first place!)
So next time you see something incredibly out of the ordinary (Goldman Sachs charged? AYFKM?), ask yourself, “what are they trying to hide?”
April 16, 2010
Goldman Didn’t See SEC Coming
FBN’s Charlie Gasparino says sources inside Goldman Sachs say they didn’t see the SEC probe coming.