Just thinking in the big picture…
If we ran Goldman Sachs, we would file to return to being a partnership which would preempt the Obama “Volcker Plan.” Then Goldman should partner with Blackstone and /or other private equity firms to ensure that they had a ready pool of capital. This would allow Goldman to lever its theme of being the smartest guys on the street and remove the government from the equation. Notes from underground is always about thinking outside the box! More will be forthcoming but we think we have been ahead of this issue for years, so stay with us on this.
Meanwhile,we view this newest wrinkle in the landscape as incidental noise as this will be a long drawn out process. The cheap money will prevail but there is no doubt that global capital is nervous!
Tags: Goldman Sachs, Paul Volcker
January 22, 2010 at 11:03 am |
YRA
very interesting thinking re GS. Would be a reasonable move for GS. Would have to be the “right” pe firm for them. Perhaps right move for GS BUT could this result in increased “collateral damage” for smaller firms that seem to be take over targets for many of the pe firms who then basically plunder their “new acquisition”. Unleashing GS + PEs might have the potential to slaughter smaller targets? Catalytic effects?
Curious.
January 22, 2010 at 11:09 am |
maybe but just thinking about the effects for goldman—and would be good for the system as it would restore the investment banks in having a fiduciary role for the entire system
January 22, 2010 at 11:19 am |
If I am a bank prop trader, I might be a little nervous. Might be calling my lawyer to find out what the weather is like in St. Somewhere to see where I can camp out while my Hedge fund paperwork went through approval.
January 22, 2010 at 11:55 am |
Is there no political top dog who’ll call “foul” to this idea? With so many ex-GS senior and mid level employees now working for the Fed Gov, the appearance of conflict of interest will be obvious and inseparably real.
First, GS hides under the Fed’s umbrella, and siphons their money back from gov’t controlled AIG, at 100% to the dollar. As well, it masquerades as a “bank”. And it stuffs unrecognized, unrealized losses in its locked back room courtesy of their boot lick, the FASB. And, to celebrate these victories, it awards it current employees with bonuses.
I’ve no dissatisfaction with GS shorting what it peddled to the dumb institutional buyers. That’s legal, and it’s done often. But I’m frankly disheartened that GS has become the financial mind of the Fed Gov, not because the individuals are not smart, but because of the seriousness of conflict of interest due to Federal positions being a revolving door.
My bias is towards fair play. This is a travesty to the concept of checks and balances.
January 22, 2010 at 12:14 pm |
no question which is how we have gotten here—my point in thinking this is that it would take Goldman out of the spotlight –which has its rewards but is now a major detriment—–blankfein should be removed for his arrogance and solely for that—his removal would be God’s work
January 22, 2010 at 12:48 pm |
yra: “…blankfein should be removed for his arrogance and solely for that—his removal would be God’s work”
Now we’re engaged in the true great debate, who has the ear of God. As if he were the supreme authority, Blankfein announced that he is doing God’s work. And the lay public genuflected, and said, “thank you.”
Yet here you post that you believe Blankfein to be apostate and he should be removed for cause.
Sigh. Such a weighty dilemma. Do I choose God’s GS or do I choose God’s not-GS?
Where’s the asperin bottle? 😉
January 22, 2010 at 12:56 pm |
i was being a wiseacre –comes with the cynicism of age–and it was the reference to blankfein’s ill advised comment as well as ill timed as the bonuses—-the music had stopped but they were dancing to their own tune
January 22, 2010 at 5:17 pm |
I would be happy to see GS disappear from my radar screen. Let them practice their black magic in private.
January 22, 2010 at 9:38 pm |
Hm I would rather have at least an “inkling” of what GS is up to rather than have them practice their “black magic in private”. Gs would greatly appreciate the ambiguity & anonymity. I prefer at least a glimpse- and frankly that is all that we get. YRA: I do appreciate your cynicism with the “GOD’s work” statement. A play on concept in reverse.
I have spent perhaps too much thought on this statement by Mr. B. Either it was a poor attempt at a deflect/PR move or it depicts how far from any sense of the “every man” Mr. B has actually gone. I have no answer.
Regardless of how the general public feels about GS and their role in our current situation, YRA’s proposal is from the abstract- the “what if”- regardless of ethical considerations. Its more of an intellectual exercise, I believe, in “what if I were GS- how could I profit the most?” removing any concept of Rule of Law, ethicism or concern for their “fellow man”. Personally, I believe thinking “outside of the box with out constraint” is a healthy mental exercise.
January 23, 2010 at 9:06 am |
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January 23, 2010 at 9:20 am |
At the news conference announcing these, Volker was next to Obama; Tim & Larry were not there. I smell a changing of the financial guard coming soon… I’d wager that Geithner at least is gone, Summers possibly as well, and today a few more senators came out against Bernanke, and his reappointment might not make it past the Senate. These changes (and policy changes thereof) could have profound effects. As for me, I’m with Volker.. it’s time to enact some meaningful oversight for these banksters. Ultimately, Obama is a smart guy; this was a really good move in the right direction. Lets hope he continues on this path; he’ll need to apply these smarts come 2011 as I think deflation will begin to bite hard. By mid 2011, things like healthcare and cap/trade will be long forgotten, as will everything else except the economy. Obama started a year late, but I now have some hope we’ll get it right.
http://themeanoldinvestor.blogspot.com/2010/01/updatecomments-122.html