![]() It's like one of those movies in which the world is taken over by robots. And a bailout program intended to put human beings back on their feet seems instead to have performed that useful service for serried ranks of profit-spewing program-trading computers. Let's become a bank, skip all that pillar-of-the-community, deposit-taking crap and hit that discount window big-time!"Īnd so they did. "They're running around out there like a Chinese fire drill!" Goldman essentially said: "These guys don't know what they're doing. ![]() And if the risk-taking could be financed with zero-cost taxpayer dollars drawn down at the discount window, access to which was acquired by taking TARP money, what a bonanza must ensue!īasically, Goldman took the same point of view as Kansas City Chargers coach Hank Stram in the 1970 Super Bowl, when his team began to disassemble the Minnesota Vikings' fearsome "Purple People Eaters" defense: "Look at 'em, boys!" he shouted to his players. Risk, which had been woefully underpriced (as it usually is by excessive competition), could now be overpriced, as it (and every other chattel and service) always is when a cartel rules. With the disappearance of Bear Stearns, Merrill Lynch and Lehman, and the crippling ofĪnd big English banks, a financial oligopoly tantamount to a cartel has sprung into existence. (Although if one looks carefully at what China seems to be up to, maybe we are.) Had this stunt been tried back in 1944, the firms' excessive profits would have been confiscated and their top executives jailed for profiteering. , have been gaming the (broadly defined) bailout with a cynicism that is by any standards breathtaking-and is, may I say as well, by most standards unpatriotic. ![]() It is some-but small-comfort to hear echoed exactly what this writer has been saying for six months now: that Goldman, and to a somewhat lesser extent, or should we say Goldie Mac?-enjoys the best of both worlds: outsize profits for its traders and shareholders and a taxpayer backstop should anything go wrong." An implicit government guarantee is only free until it's not, and when the bill comes due it tends to be huge. ![]() "Goldman will surely deny that its risk-taking is subsidized by the taxpayer-but then so did ![]()
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