Big Swinging Dicks and Goldman Sachs Plans

Goldman Sachs has always been a Wall Street firm with a mission. Greed, big brass ones, being the self proclaimed Masters of the Universe, and having the biggest swinging dicks of any of the New York investment banking firms, really of any investment banking firm anywhere, took Goldman far down the road to fulfilling that mission.

That mission was clearly to line their own pockets with as much money as possible, morals and ethics be damned. No doubt Goldman partners were and are smart people. So smart that they even outsmarted themselves. It’s hard to believe that one firm could become so powerful, perhaps even to having a very real influence and control over the affairs of a sovereign nation – the United States of America.

The partners at Goldman all work hard. They must feel that they are due the enormous financial rewards and multi million dollar bonuses that they bestow upon themselves. Even if their reckless and irresponsible actions had a great deal to do with the world’s financial markets meltdown.

Gee, who could have known that creating exotic financial derivatives could lead to so much trouble? All of those mortgages made by people who had no jobs couldn’t all go bad at once could they? The odds of Black Swans paying a visit are so small we don’t have to worry about them, right? What’s wrong with 40 to 1 leverage or more when the risk is so small?

Actually Goldman knew full well that the Black Swan would eventually swoop in and that the housing bubble would go bust. Remember, these are very smart finance educated guys and gals, most with advanced degrees from the best business schools in America.

No. It wasn’t that the Goldman crowd didn’t know that the boom would turn into bust, hell, they even hedged their exposure with counterparties like AIG. They know very well how toxic many of the mortgage packages were. They just didn’t care. Goldman made such tremendous profits from selling these terrible investments, stamped with a AAA rating by the corrupt rating services, that they were determined to feed at the money trough for as long as possible. Besides, Goldman was able to transfer much of the risk to other parties, even to taxpayers. As long as the money flowed in they just didn’t care.

Alas, as the boom turned to the worse bust since the great depression Goldman was forced to accept TARP funds from its close friends at the US Department of the Treasury. Goldman didn’t really want the money as they knew that restrictions would come with it. For one thing Goldman had to get a commercial banking licence, which meant that it would be considerably more regulated.

Which brings us to the present. Goldman doesn’t like regulation, especially any that limits the payouts to its employees. Well, it is understandable. It’s hard to go from multi million dollar bonuses to salary caps of only $500,000 a year. No one in America can hardly get by with that peanut payout. Right?

So Goldman wants to give back the TARP money and get out from close government supervision ASAP. Goldman must feel that regulation is for wimps, not big swinging dicks. What Goldman really wants is to go back to the way it was. To hell with risk management. If the potential payoff is big enough, go for it. Just find a sucker counterparty like AIG.

So what if the global economy was taken right to the edge of disaster, perhaps over the edge as we aren’t out of the mess yet? Goldman wants to be able to return to the Masters of the Universe days and appears to think that it can do it.

Unfortunately, the Obama administration seems to be wanting about the same thing. To return to the wonderful world of 2006 and 2007 when the boom was on. As far as I can tell everything so far out of Goldman and the Obama financial advisers is geared to taking us back to the glory days. Every effort is being made to sustain the unsustainable. The fix is on.

There seems to be no recognition that the world has changed. The converging consequences of peak oil, climate change, and the ongoing financial meltdown has and is changing the world as we will soon see. Goldman Sachs, the Obama administration, and most of the America people are in full denial. When reality sets in it will be harsh. The unprepared will stand a good chance of an early death.

The plan of Goldman Sachs to bring back the past and live once again as big swinging dicks seems to be admired by the Obama financial team. Certainly Bernanke and Geithner seem to be on board as Goldman cheerleaders and team Goldman players. The long crisis will be much longer than necessary with Goldman Sachs and Wall Street calling the shots. Who really controls our government, anyhow?