“So why don’t you just get lost, OK?”

“Guys like me don’t ever get lost.” – Mobster character in a Mike Lupica novel.

So the SEC believes it can take on too big to fail. They really seem to think they have a prayer against Goldman Sachs. They’ve thrown down the gauntlet, they’ve filed their charges, they’ve lawyered-up like OJ, and called in Big, Bad, Neil Barofsky to serve as their Exorcist –In-Chief.

They are here to reprise the role of Van Helsing, and turn the dreaded vampire squid into calamari, with red sauce and lemon. Just in time for the midterm elections. What an amazing coincidence!

First among the problems faced by the SEC is the fundamental lack of a legal gravamen to charge Goldman Sachs. If Congress had outlawed being a profiteering jerk back in the George Washington Era, I’d be commuting to work in a horse and buggy. The Gold-Sachs are a bunch of flaming (decency edit). We get that. So was Whoopi Goldberg when she didn’t think Roman Polanski really committed a rape. I don’t see the SEC going after her. Condign justice allows her to stew in her own acrid juices.

The SEC claims that Goldman Sachs misrepresented the value of their products to perspective investors. I don’t doubt it. Burger King and General Motors do the same thing every time either corporate entity takes to the air waves. It’s called advertising. Corporations, like Barack Obama, lie for a living while they sing for their suppers.

In particular, the SEC claims that Goldman Sachs sold a dicey set of mortgage-backed securities called ABACUS in 2007. A then-unknown entity, named John Paulson, bet a huge chunk of his hedge fund that Goldman Sachs was peddling crap. Predictably, Goldman Sachs laughed out loud at Paulson’s objections and referred to the man as an idiot.

The SEC goes further, and claims Paulson helped design ABACUS so that he could short it and reaped a fortune for his duplicitous efforts. Probably so, Paulson could pick up a telephone and suggest things to GS all day. If the counterparty broker is more stupid than Little Red Riding-Hood and answers the phone with “Granny, what excellent sub-prime mortgages you have,” the Prudent Capitalist shouldn’t get too shocked if the wolf known as Paulson then replies “All the better to SCREW you with!”

Sebastian Malleby describes the negotiations process that led to SEC Plaintiff, ACA doing the deal with GS and betting against Paulson on the ABACUS MBS.

As the deal was taking shape, ACA and Paulson met repeatedly. If ACA had any doubt as to Paulson’s intentions, surely it could have asked him a straight question rather than relying on alleged hints from Goldman. Throughout the negotiations, Paulson kept proposing notoriously low-quality mortgages for the bundle and vetoing high-quality ones. It should have been obvious to ACA that he meant to bet that they would go down. The worst that can be said on the basis of the available evidence is that Goldman knew ACA was being stupid and failed to point this out.

Again, if taking the money of fools was illegal business practice, General Motors would be guilty every time they sold another car. But the designers of the Democratic Party’s 2010 midterm campaign know all of this good and well. They are bailing, not jailing, the GM CEO-of-the-Week over at Rust-bucket Headquarters.

Even supposing that the SEC blindly believes they should prosecute GS, in the absence of legal gravamen to so do, just for being a bunch of cheese-dicks, the agency has yet another problem. Their own bosses. The ones in The White House with $994K good reasons to put Goldman Sachs first.

If all of the GS alumni in The Obama White House took an evening off to attend a GS reunion over at The Thieves’ Guild, the executive branch of the US Government would do the citizenry a favor and close for the evening. Michelle Malkin points out the disturbingly large Goldman Cabal that regularly pays work calls to 1600 Pennslyvania Avenue.

Goldman Sachs partner Gary Gensler is Obama’s Commodity Futures Trading Commission head. Goldman Sachs kept White House Chief of Staff Rahm Emanuel on a $3,000 monthly retainer while he worked as Clinton’s chief fundraiser, as first reported by Washington Examiner columnist Tim Carney.

Former Goldman Sachs lobbyist Mark Patterson serves under Geithner as his top deputy and overseer of TARP bailout — $10 billion of which went to Goldman Sachs. White House National Economic Council head Larry Summers reaped nearly $2.8 million in speaking fees from many of the major financial institutions and government bailout recipients he now polices, including JP Morgan Chase, Citigroup, Lehman Brothers and Goldman Sachs.

In 1995, he spearheaded a $40 billion Mexican peso bailout that bypassed Congress. Summers personally leaned on the International Monetary Fund to provide nearly $18 billion for the package. Summers’ boss, then Secretary of the Treasury Robert Rubin, was former co-chairman of Wall Street giant Goldman Sachs — the Mexican government’s investment banking firm of choice. (HT: Michelle Malkin)

So how does this pathetic show trial aimed at political viability in the 2010 midterms grind to a laughable end? Circle November 1st on your calendars. It’s date when all the poo-bahs at Goldman Sachs will visit their favorite acquisition in DC, President Obama.

They will apologize to him personally, in front of a large TV audience, while the always non-partisan news media praises the courage of DEMOCRATS!!!!!!!!!!! for bringing the evil vampire squid to obedient heel. Oh, and GS will pay a $0.25 fine for their non-violations. Justice for all!


Tags: Obama sec