.
April 15th, 2011
12:14 AM ET

KTH: Goldman Sachs under fire

Editor's note: Anderson Cooper reports on the dealings of Goldman Sachs at issue in a recent congressional report.

Related on CNNMoney.com: Goldman blasted for conflicts of interest

April 14th, 2011
10:00 AM ET

Goldman blasted for conflicts of interest

Ben Rooney
CNNMoney.com Staff Reporter

NEW YORK (CNNMoney) - A Senate panel issued a scathing report Wednesday that describes Goldman Sachs as a "case study" of the recklessness and greed on Wall Street that set off the 2008 financial crisis.

The 600-page report also blames the lending practices of big commercial banks, such as the now-defunct Washington Mutual, for plunging the U.S. economy into a painful recession.

The regulators who failed to crack down on the banks, including the Office of Thrift Supervision, are faulted for their cozy relationship with Wall Street, as are the major credit rating agencies, Moody's and Standard & Poor's.

"Our investigation found a financial snake pit rife with greed, conflicts of interest, and wrongdoing," said Senator Carl Levin, chairman of the Senate subcommittee charged with investigating the causes of the financial crisis.

The subcommittee, which spent two years on the investigation, based its report on thousands of internal company documents and emails, as well as hundreds of interviews and Congressional testimony.

The subcommittee singled out Goldman (GS, Fortune 500) and Deutsche Bank (DB) as examples of Wall Street firms that reaped huge profits by marketing securities backed by subprime mortgages as safe investments to clients, even as the banks bet against these very same securities.

Full story on CNNMoney.com


Filed under: 360° Radar • Wall St.
May 7th, 2010
03:42 PM ET

Job opening? $22k an hour

Tom Foreman | BIO
AC360° Correspondent

You know what Goldman Sachs CEO, Lloyd Blankfein, and the island nation of Kiribati have in common?  In 2007 they each made about the same amount of money.

You know what Goldman Sachs CEO, Lloyd Blankfein, and the island nation of Kiribati have in common? In 2007 they each made about the same amount of money.

You know what Goldman Sachs CEO, Lloyd Blankfein, and the island nation of Kiribati have in common? In 2007 they each made about the same amount of money. $68 million. I’m no enemy of capitalism, and I love the notion of folks getting ahead, but doesn’t that seem perhaps a tad excessive?

I return to the smiling Mr. Blankfein because in the wake of his visit to Capitol Hill to defend Wall Street, he has continued to suggest that people should not be angry with his staggering income because, after all, he earned it.

Well, let’s look at his theoretical time sheet. We’ll assume he’s a hard worker, never takes vacations, and even on holidays catches up on paperwork. But the financial markets are closed on weekends, so he gets 260 working days in a year. I’ll further assume he’s a steady laboring guy; your head doesn’t get that shiny without a lot of hair pulling and sweating the details. We’ll say he is at the office at least 12 hours a day; so 3,120 hours for the year.

We do some math, carry some ones, and Bob’s your uncle, turns out old Lloyd’s going rate is just under $22,000 an hour. Or $363 a minute. Which raises a question: How can anyone possibly “earn” that much, in the sense that most of us understand the concept of earning?

Pro athletes, heart surgeons, plumbers, hookers, and hit men don’t rake in that kind of dough. Heck, load up an airport van full of them all mixed together and they’d still collectively be paupers compared to the oh so valuable Lloyd.

For that matter, take your run-of-the-mill extremely well-paid professional, say some gal who pulls a million a year, which is not just Slurpee money. If she started working at the age of 21, she would not get to clean out her desk and book a tee time until she was almost 90 years old; and at that point she would have made only what Senor Lloyd banked in one year.

So while he certainly received, scored, banked, snared, and/or got a lot of money that year, his argument that he “earned” it, I suspect for many working folks, rattles like a counterfeit quarter. Or 272 million of them. But who is counting?


Filed under: Opinion • Tom Foreman • Wall St.
April 30th, 2010
11:55 AM ET

Money talks, but doesn't listen

Tom Foreman | BIO
AC360° Correspondent

The fury over Wall Street Fat Cats reached a new high on Capitol Hill this week, as a police lineup of Goldman Sach’ers came to scratch and yawn while Senators desperately tried to make them admit…well, frankly, anything.

In my brief moments of lucidity as I struggled against the coma-inducing Kryptonite of a Congressional hearing, this is what they extracted in the way of confessions: 1) High finance is really complex, 2) We’re upset about how things turned out, because the tens of millions we scored in bonuses is not nearly enough, and 3) Yes, we heard something about a housing collapse. How is that working out for you little people?

Part of the problem was a language barrier. The Senators were speaking in Outrage; a commonly understood tongue of the American populace. But the GS’ers were answering in Filthy-Richese; actually a rare dialect of that language known as I’ve-Got-More-Money-Than-the-Pope. And btw, he’s got a boss, I don’t.

But there was also a knowledge gap between the sides. Members of Congress are often more instinctive than intelligent. Don’t get me wrong: They can be smart, but the skills needed to win public office these days do not necessarily require it. (Oddly enough, getting elected does require an almost feral ability to sniff out and avoid cell phone cameras when a mistress is in tow, but that’s another story.) As a result, precious few of our top elected officials appear to be as versed in the big money game as they need to be for this kind of show down.

Out of the entire panel trying to pin down the GS’ers, only Senator Carl Levin of Michigan seemed truly comfortable navigating the arcane terms and concepts that the Wall Street crowd sprays like octopus ink whenever the questions get too threatening. And even he, with his prosecutorial zeal, never really came close to cornering them.

Because in the end, the GS’ers came wrapped in virtually impenetrable suits of money, capable of deflecting almost anything the politicos fire at them. They deny any wrongdoing. They are fighting the SEC charges against their company. They’re keeping the cash.

Money talks. And what it is saying to those in DC who think Wall Street greed helped tank the U.S. economy, is “So what?”


Filed under: Raw Politics • Tom Foreman • Wall St.
April 28th, 2010
10:02 AM ET

Video: Goldman Sachs execs questioned

Tom Foreman | BIO
AC360° Correspondent


Filed under: 360° Radar • Tom Foreman • Wall St.
April 27th, 2010
04:11 PM ET

When short selling is good

Richard Sauer
Special to CNN

Sauer: Goldman Sachs accused of lying about its method to help client short housing market

Sauer: Goldman Sachs accused of lying about its method to help client short housing market

Pity the poor short-seller. Seriously. That much-maligned creature gets no love at the best of times, and these days are more like the worst.

This, despite the irreplaceable benefits he brings to the financial markets. Short-selling in the conventional sense involves borrowing stock, selling it and, at a later date, replacing the borrowed shares though market purchases. If, in the interim, the shares have declined in value, the short-seller prospers. If not, he doesn't.

Keep Reading...


Filed under: 360° Radar • Economy • Richard Sauer • Wall St.
April 27th, 2010
11:31 AM ET

Documents: Goldman Sachs' testimony

AC360°

Top representatives from Goldman Sachs maintained Tuesday that the company did not engage in any questionable business deals leading up to the financial crisis.

Don't miss our analysis of the hearing tonight on AC360° at 10 p.m. ET.

And if you didn't have time to watch the hearing, you can read the testimonies here:

Lloyd Blankfein, Chairman and CEO,  Goldman Sachs

Fabrice Tourre, Goldman Sachs International, London

Michael Swenson, Managing Director, Goldman Sachs Mortgage Department

Josh Birnbaum, Managing Director, Goldman Sachs Structured Products Group

David A. Viniar, Chief Financial Officer, Goldman Sachs


Filed under: 360° Radar • Finance • Wall St.
April 26th, 2010
06:35 PM ET

Goldman Sachs' political contributions

Goldman Sachs' PAC and employees were among the top contributors to Barack Obama's campaign.

Goldman Sachs' PAC and employees were among the top contributors to Barack Obama's campaign.

CNN

The charts below summarize Goldman Sachs’ political contributions to federal candidates over the last several campaign cycles. Federal law prohibits a company from directly contributing money to a campaign; the totals below include contributions from the Goldman Sachs PAC and individual contributors who listed Goldman Sachs as their employer, and their family members. All of this information and more can be found at the Center for Responsive Politics.

Barack Obama’s top contributors from company PACs and employees (2007-2008 cycle)

Grouped together, Goldman Sachs’ PAC and employees were among the top contributors to the Obama presidential campaign.

University of California $1,591,395

Goldman Sachs $994,795

Harvard University $854,747

Microsoft Corp $833,617

Google Inc $803,436

Citigroup Inc $701,290

JPMorgan Chase & Co $695,132

Time Warner $590,084

Sidley Austin LLP $588,598

Stanford University $586,557

National Amusements Inc $551,683

UBS AG $543,219

Wilmerhale Llp $542,618

Skadden, Arps et al $530,839

IBM Corp $528,822

Columbia University $528,302

Morgan Stanley $514,881

General Electric $499,130

US Government $494,820

Latham & Watkins $493,835

John McCain’s top contributors from company PACs and employees (2007-2008 cycle)

Merrill Lynch $373,595

Citigroup Inc $322,051

Morgan Stanley $273,452

Goldman Sachs $230,095

JPMorgan Chase & Co $228,107

US Government $208,379

AT&T Inc $201,438

Wachovia Corp $195,063

UBS AG $192,493

Credit Suisse Group $183,353

PricewaterhouseCoopers $167,900

US Army $167,820

Bank of America $166,026

Gibson, Dunn & Crutcher $159,596

Blank Rome LLP $154,226

Greenberg Traurig LLP $146,437

US Dept of Defense $144,105

FedEx Corp $131,974

Bear Stearns $117,498

Lehman Brothers $114,357

Click here to see a summary of Goldman Sachs PAC and employee contributions over the years. Goldman Sachs PAC and employees have given more to Democrats than Republicans across the past several campaign cycles.

Breakdown of Goldman Sachs PAC and employee contributions to members of Congress

Money to Congress: 2010 Cycle

Dems:

$332,375

Repubs:

$190,200

Others:

$0

Incumbents:

$398,900

Non-Incumbents:

$123,675

House
# of Members
Average Contribution
Total Contributions

Democrats
33
$5,101
$168,350

Republicans
28
$2,782
$77,900

Independents
0
$0
$0

TOTAL
61
$4,036
$246,250

Senate
# of Members
Average Contribution
Total Contributions

Democrats
19
$4,878
$92,700

Republicans
10
$5,995
$59,950

Independents
0
$0
$0

TOTAL
29
$5,263
$152,650

Goldman Sachs PAC and employee contributions to Senate Banking Committee members (2009-2010)

Bayh, Evan (D-IN) $5,400

Bennet, Michael F (D-CO) $4,800

Bennett, Robert F (R-UT) $8,800

Bunning, Jim (R-KY) $2,000

Crapo, Mike (R-ID) $3,000

DeMint, James W (R-SC) $1,000

Dodd, Chris (D-CT) $4,250

Schumer, Charles E (D-NY) $22,600

Shelby, Richard C (R-AL) $34,600

Goldman Sachs PAC and employee contributions to House Financial Services Committee members (2009-2010)

Adler, John H (D-NJ) $5,750

Bachus, Spencer (R-AL) $2,500

Bean, Melissa (D-IL) $9,400

Capuano, Michael E (D-MA) $1,500

Castle, Michael N (R-DE) $2,400

Donnelly, Joe (D-IN) $1,000

Ellison, Keith (D-MN) $500

Foster, Bill (D-IL) $4,500

Garrett, Scott (R-NJ) $2,000

Hensarling, Jeb (R-TX) $1,000

Himes, Jim (D-CT) $15,150

Hodes, Paul W (D-NH) $13,100

Jenkins, Lynn (R-KS) $2,000

Lance, Leonard (R-NJ) $3,000

Lee, Christopher J (R-NY) $2,000

Maloney, Carolyn B (D-NY) $4,400

McCarthy, Kevin (R-CA) $4,500

McCotter, Thad (R-MI) $2,000

Meeks, Gregory W (D-NY) $2,500

Minnick, Walter Clifford (D-ID) $5,000

Paulsen, Erik (R-MN) $2,000

Posey, Bill (R-FL) $2,000

Royce, Ed (R-CA) $2,400

Velazquez, Nydia M (D-NY) $3,500

Waters, Maxine (D-CA) $2,400

Watt, Melvin L (D-NC) $2,500

Top Recipients, all federal candidates (2009-2010 cycle only)

McMahon, Michael E (D-NY) House $50,550

Shelby, Richard C (R-AL) Senate $34,600

Gillibrand, Kirsten (D-NY) Senate $23,800

Murphy, Scott (D-NY) House $23,450

Schumer, Charles E (D-NY) Senate $22,600

Kirk, Mark (R-IL) House $21,600

Pleitez, Emanuel (D-CA) House $20,175

Wyden, Ron (D-OR) Senate $15,900

Himes, Jim (D-CT) House $15,150

Khazei, Alan (D-MA) Senate $14,600

Hodes, Paul W (D-NH) House $13,100

Crist, Charles J Jr (R-FL) Senate $10,100

Dold, Robert (R-IL) House $9,850

Bean, Melissa (D-IL) House $9,400

Bennett, Robert F (R-UT) Senate $8,800

Roskam, Peter (R-IL) House $7,400

Saujani, Reshma M (D-NY) House $7,200

Coakley, Martha (D-MA) Senate $7,050

Blunt, Roy (R-MO) House $6,200

Adler, John H (D-NJ) House $5,750

Brown, Scott P (R-MA) Senate $5,550

Bayh, Evan (D-IN) Senate $5,400

Chachas, John Gregory (R-NV) Senate $5,100

Meek, Kendrick B (D-FL) House $5,050

Hoyer, Steny H (D-MD) House $5,000

Minnick, Walter Clifford (D-ID) House $5,000

Reid, Harry (D-NV) Senate $4,900

Bennet, Michael F (D-CO) Senate $4,800

Fiorina, Carly (R-CA) Senate $4,800

Conway, Jack (D-KY) Senate $4,650

Foster, Bill (D-IL) House $4,500

Lincoln, Blanche (D-AR) Senate $4,500

McCarthy, Kevin (R-CA) House $4,500

Ayotte, Kelly A (R-NH) Senate $4,400

Maloney, Carolyn B (D-NY) House $4,400

Dodd, Chris (D-CT) Senate $4,250

Foley, Thomas C (R-CT) Senate $4,150

Inouye, Daniel K (D-HI) Senate $4,000

Velazquez, Nydia M (D-NY) House $3,500

Specter, Arlen (D-PA) Senate $3,350

Hoffman, David (D-IL) Senate $3,150

Crapo, Mike (R-ID) Senate $3,000

Lance, Leonard (R-NJ) House $3,000

Murphy, Patrick J (D-PA) House $2,900

Tedisco, Jim (R-NY) House $2,900

Jackson, Cheryle (D-IL) Senate $2,800

Dorgan, Byron L (D-ND) Senate $2,650

Portman, Rob (R-OH) Senate $2,650

Bachus, Spencer (R-AL) House $2,500

Meeks, Gregory W (D-NY) House $2,500

Watt, Melvin L (D-NC) House $2,500

Bera, Ami (D-CA) House $2,400

Castle, Michael N (R-DE) House $2,400

Fisher, Lee Irwin (D-OH) Senate $2,400

Flake, Jeff (R-AZ) House $2,400

Royce, Ed (R-CA) House $2,400

Sowers, Tommy (D-MO) House $2,400

Waters, Maxine (D-CA) House $2,400

Williams, Roger (R-TX) Senate $2,400

Ros-Lehtinen, Ileana (R-FL) House $2,200

Bono Mack, Mary (R-CA) House $2,000

Bunning, Jim (R-KY) Senate $2,000

Camp, Dave (R-MI) House $2,000

Garrett, Scott (R-NJ) House $2,000

Grassley, Chuck (R-IA) Senate $2,000

Jenkins, Lynn (R-KS) House $2,000

Lee, Christopher J (R-NY) House $2,000

McCotter, Thad (R-MI) House $2,000

Melancon, Charles (D-LA) House $2,000

Paulsen, Erik (R-MN) House $2,000

Posey, Bill (R-FL) House $2,000

Rangel, Charles B (D-NY) House $2,000

Schwartz, Allyson (D-PA) House $2,000

Capuano, Michael E (D-MA) House $1,500

White, Bill (D-TX) Senate $1,500

Boxer, Barbara (D-CA) Senate $1,250

Arcuri, Michael (D-NY) House $1,000

Baucus, Max (D-MT) Senate $1,000

Burton, Dan (R-IN) House $1,000

Cantor, Eric (R-VA) House $1,000

Coburn, Tom (R-OK) Senate $1,000

DeMint, James W (R-SC) Senate $1,000

Diaz-Balart, Mario (R-FL) House $1,000

Donnelly, Joe (D-IN) House $1,000

Etheridge, Bob (D-NC) House $1,000

Grayson, Trey (R-KY) Senate $1,000

Gutierrez, Armando Jr (R-FL) House $1,000

Hamos, Julie (D-IL) House $1,000

Hensarling, Jeb (R-TX) House $1,000

Isakson, Johnny (R-GA) Senate $1,000

Kind, Ron (D-WI) House $1,000

Klobuchar, Amy (D-MN) Senate $1,000

Leahy, Patrick (D-VT) Senate $1,000

McDonald, Jack (D-TX) House $1,000

Murkowski, Lisa (R-AK) Senate $1,000

Murphy, Chris (D-CT) House $1,000

Murphy, Tim (R-PA) House $1,000

Norton, Jane (R-CO) Senate $1,000

Pelosi, Nancy (D-CA) House $1,000

Rooney, Brian John (R-MI) House $1,000

Top Recipients, all federal candidates (1990-2010)

Obama, Barack (D-Ill) $1,053,795

Clinton, Hillary (D-NY) $682,690

Corzine, Jon S (D-NJ) $585,870

Bush, George W (R-Texas) $528,124

Schumer, Charles E (D-NY) $481,040

Kerry, John (D-Mass) $351,750

McCain, John (R-Ariz) $337,065

Bradley, Bill (D-NJ) $323,550

Dodd, Chris (D-Conn) $273,466

Romney, Mitt (R-Mass) $254,025

Ryan, Jack (R-Ill) $218,161

Edwards, John (D-NC) $213,750

Lazio, Rick A (R-NY) $194,300

D'Amato, Alfonse M (R-NY) $189,150

Himes, Jim (D-Conn) $170,248

Bayh, Evan (D-Ind) $164,950

Specter, Arlen (R-Pa) $164,700

Daschle, Tom (D-SD) $158,500

Giuliani, Rudolph W (R-NY) $150,750

Menendez, Robert (D-NJ) $149,950

Clinton, Bill (D-Ark) $140,659

Lowey, Nita M (D-NY) $132,290

Lieberman, Joe (I-Conn) $123,700

Rangel, Charles B (D-NY) $115,100

Ford, Harold E Jr (D-Tenn) $111,997

Hutchison, Kay Bailey (R-Texas) $111,300


Filed under: 360° Radar • President Barack Obama • Wall St.
April 26th, 2010
12:03 PM ET

Wall Street didn't cause crash of '08

Wall Street should not be blamed for the crash of 2008, says Frum.

Wall Street should not be blamed for the crash of 2008, says Frum.

David Frum
CNN Contributor

Financial reform? Not exactly. The bill before Congress does nothing to address the fundamental background causes of the crash of 2008.

Wall Street may have been the instrument of the crash. But the crash was made elsewhere: in Washington's failed policies for middle-class families - and in China's distorted rush for economic growth.

The story is not a simple one. But I hope you will pay attention to the details. If you don't, you may find that the pocket that has been picked is your own.

As you've heard, the crash begins with the huge excess load of debt built up in the last two decades by American households. Why did Americans borrow so much? Some like to tell a story of irresponsibility: We borrowed too much because we were self-involved yuppies who just could not deny ourselves the latest flat-screen doodad for our McMansions.

Keep Reading...


Filed under: Economy • Wall St.
April 26th, 2010
11:14 AM ET

A $2.95 lesson for Wall Street

The public's wariness of Wall Street is growing, with Goldman Sachs being accused of fraud by the Securities and Exchange Commission.

The public's wariness of Wall Street is growing, with Goldman Sachs being accused of fraud by the Securities and Exchange Commission.

Bob Greene
CNN Contributor

I wish the titans of Wall Street could meet Mark Dalton.

Not that it would be likely to change anything. But I wish the leaders of Goldman Sachs and of the other big banking firms could talk to Mark Dalton for just a few minutes.

They might learn a few things about how to better connect with the American people.

I didn't know Dalton's last name until a few days ago. For almost two years, I've held onto something he mailed to me. There was no reason not to throw it out, yet I had a feeling that someday I'd want to refer to it.

That day is now. With the public's wariness of Wall Street growing, with Goldman Sachs being accused of fraud by the Securities and Exchange Commission (even as Goldman was announcing first-quarter profits of $3.46 billion, nearly twice as much as in the first quarter a year ago), with investors wondering if they're being given a fair shake by the firms to which they have entrusted their money, Mark Dalton's way of doing business might be worthy of at least a moment's attention.

Keep Reading...


Filed under: Economy • Wall St.
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