Saturday, May 01, 2010

How Carl Levin got Goldman Sachs's goat

But I pointed out point blank to Blankfein: "Your motto is that you need the trust of your clients, that your client comes first." Well that's not true. That is simply not true.

SHOOT: Exactly. Blankfein says they rely on their client's trust and that's exactly what they abuse.
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When they did answer, some people have asked me, "Were they telling you the truth?" The answer is yeah, and that's what's even more troubling than the evasions -- they are defending what most people would say are indefensible actions. They shouldn't be betting against what they're selling at the same time they're telling you: "Here, these are our securities, our names are on the prospectus."

I think people think that someone selling something believes their product needs to succeed in some general way; that they want it to succeed. But [Goldman Sachs] are betting against [their product] and basically say they are going to profit from its failure. At that point, in most people's minds, clearly in mine, there's a conflict of interest. You're betting against a product that you're holding out to the public, by fair assumption, as a good product.

They think they can do anything they want, that it's a dog-eat-dog market and all these sophisticated buyers know that.
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