Apparently, the U.S. government didn't have enough Goldman Sachs executives in key financial and regulatory positions, so the following happened this week:
A Goldman Sachs executive has been named the first chief operating officer of the Securities and Exchange Commission's enforcement division.
The
market watchdog says Adam Storch, vice president in Goldman Sachs'
Business Intelligence Group, is assuming the new position of managing
executive of the SEC division.The move comes as the SEC
revamps its enforcement efforts following the agency's failure to
uncover Bernard Madoff's massive fraud scheme for nearly two decades
despite numerous red flags.
A Goldman executive as COO of the SEC's enforcement division. This is all consistent with the observation of Desmond Lachman
-- previously chief emerging market strategist at Salomon Smith Barney
and IMF deputy director -- regarding "Goldman Sachs's seeming lock on
high-level U.S. Treasury jobs," which he cited as but one of the many
"parallels between U.S. policymaking and what we see in emerging
markets."
In October of last year, a Goldman Sachs Vice President, Neel Kashkari, was named by former Goldman CEO and then-Treasury Secretary Hank Pauslon to oversee the$700 billion TARP bailout. In January of this year, Tim Geithner hired a former Goldman Sachs lobbyist, Mark Patterson, to be his top aide and Chief of Staff. In March, President Obama nominated
Goldman Sachs executive Gary Gensler to head the Commodity Futures
Trading Commission, which regulates futures markets, even though
(or "because") Gensler confessed to lax regulation during the Clinton
administration over the very derivative instruments that caused the
financial crisis. In April, Goldman hired
as its top lobbyist Michael Paese, the top aide to Rep. Barney Frank on
the House Financial Services Committee which Frank chairs.
According to ABC News in October, 2008,
Goldman "spent more than $43 million dollars on lobbying and campaign
contributions to cultivate friends and buy influence in Washington,
D.C. since 1989" and their "bankers have been the country's top political campaign contributors
this year." "They are almost in a class by themselves," said Sheila
Krumholz, the executive director for the Center for Responsive
Politics. As Michael Moore has been pointing out,
Goldman was the number one source of funding for the Obama 2008
presidential campaign. The bailout of AIG -- which resulted in massive
federal government monies to Goldman -- was engineered at a meeting between Paulson, Geithner and Goldman CEO Lloyd Blankfein. Last year, Goldman paid top Obama economics adviser Larry Summers $135,000 for a one-day visit to Goldman.
Recently obtained calenders from Geithner reveal that
"Goldman, Citi and JPMorgan can get Geithner on the phone several times
a day if necessary, giving them an unmatched opportunity to influence
policy" and "Geithner's contacts with Blankfein alone outnumber his
contacts with Sen. Chris Dodd, D-Conn., chairman of the Senate Banking
Committee." Documents obtained byThe New York Times
relating to Geithner's work before becoming Treasury Secretary "show[]
that he forged unusually close relationships with executives of Wall
Street's giant financial institutions."
Of course, only an
irrational, raving conspiracy theorist would believe that any of those
events have any connection at all to this, from today's Washington Post:
The
nation's largest banks, preserved from failure by federal aid and
romping in markets revived by federal aid, are racking up vast profits
even as the broader economy struggles to emerge from recession . . .Goldman said it earned $3.19 billion between July and September, nearly the most it has ever made in three months, a record it set earlier this year.
So
the most profitable quarter Goldman Sachs ever had in its history was
the second quarter of 2009 -- just a few months after massive amounts
of taxpayer money were transferred to them and their counter-parties in
order to prop up their business, while several of its key competitors
were allowed to die. The second-most profitable quarter it ever had in
its history was the third quarter of 2009. In his seminal article in The Atlantic
earlier this year, former IMF economist and current MIT Professor Simon
Johnson warned (just like former IMF official Lachman did) that, for
deeply corrupt oligarchies in which the unrestrained power and
recklessness of the oligarchs spawn a financial crisis, this is what
happens: "at the outset of the crisis, the oligarchs are
usually among the first to get extra help from the government . . .
Meanwhile, needing to squeeze someone, most emerging-market governments
look first to ordinary working folk -- at least until the riots grow
too large."
Just compare Johnson's description for what
happens in corrupt oligarchies to the pictoral representation of
Goldman's profits since the September, 2008 financial crisis, from
today's Post:
Goldman employees are set to receive record bonuses this year as well. That occurred at the same time the unemployment rate went to 9.8%, the highest in 26 years. Is it possible to imagine a more vivid illustration of what Johnson described?
It's
true that the threat of worldwide economic collapse has abated, and
that's a good thing. It's not particularly surprising that if the
Government transfers trillions of dollars to an industry, then that
industry will improve. But, as the Treasury Department's independent
and tenacious watchdog, Neil Barofsky, has been trying to warn,
the surviving banks are bigger and more powerful than ever, thus
maximizing our dependence on them, and the primary stated goal of the
bailout (increasing lending) has not been achieved. Rep. Frank's
committee in the House yesterday passed a bill to regulate derivatives
that is so filled with loopholes
it may end up exempting most industry players. That the administration
continues, so brazenly, to place Goldman Sachs executives in the very
government positions with the greatest power over the financial
industry illustrates how little effort is devoted to hiding what is
really taking place.
UPDATE: Business Insiderhas more details on Storch,
the new COO of SEC Enforcement: He's 29, and has worked at Goldman
Sachs for the last 5 years -- since he was 24 years old. I'm sure
there was nobody more qualified for that position and that he'll be an
absolutely relentless and fearsome force in helping the SEC enforce
applicable laws and regulations.
UPDATE II:
I owe Adam Storch an apology for unfairly questioning whether he's
really the most qualified person for the position of COO in
SEC enforcement. After all, in 2002, he was named as a Co-Winner by
SUNY-Buffalo of the prestigious Intern of the Year Award, for his sterling summer work in sorting mail and fetching coffee at Deloitte & Touche (h/t thelastnamechosen).
UPDATE III: The New York Times this morning has a darkly amusing article
by Graham Bowley on all of this. I can't quite tell if the humor is
intentional, but either way, it's glaring. The article begins with
this observation: "Even as the economy continues to struggle, much of
Wall Street is minting money -- and looking forward again to hefty
bonuses." With an earnestly innocent tone, it then poses this
question: "Many Americans wonder how this can possibly be. How
can some banks be prospering so soon after a financial collapse, even
as legions of people worry about losing their jobs and their homes?" Indeed, how could such a confounding thing have happened? This way:
It may come as a surprise that one of the most powerful forces driving the resurgence on Wall Street is not the banks but Washington. Many of the steps that policy makers took
last year to stabilize the financial system -- reducing interest rates
to near zero, bolstering big banks with taxpayer money, guaranteeing
billions of dollars of financial institutions' debts -- helped set the stage for this new era of Wall Street wealth. . .So
even as big banks fight efforts in Congress to subject their industry
to greater regulation -- and to impose some restrictions on executive
pay -- Wall Street has Washington to thank in part for its latest bonanza.
That
is so very, very unexpected: that policies designed by former Goldman
CEO Hank Paulson, ultimate Wall Street servant Tim Geithner, and the banking-owned United States Congress
would redound to the personal benefit of investment banking executives
but not the general public. It's the opposite of free market
capitalism: it is the Federal Government intervening for the benefit of
a tiny sliver of oligarchs who fund and own the government itself. The
NYT article details the numerous ways that Washington policies
over the last year have directly maximized Goldman profits, while
the AP reporter who wrote the article on Geithner's calender records,
Matt Apuzzo, told this to NPR earlier this week, in a segment entitled "Bank Execs Had Direct Line to Geithner" (h/t Carolyn C):
What's
very interesting here is he seems to have this kitchen cabinet, if you
will, of these three big banks that he talks to, not just when it's
something about big banks, he talks to them during the auto crisis; he talks to them late at night; he talks to them first thing in the morning.There's
this great sequence of phone calls one night in the middle of the auto
crisis where the secretary takes three phone calls and it's Goldman
Sachs, JPMorgan, the president of the United States; hangs up with the
president and then he's immediately back on the phone with JPMorgan.And
when you look at it in that way, you can see that those three banks
have greater influence - they have a greater ability to influence
policy than any other bank. I mean, it's really an unmatched
ability to have the secretary of the Treasury's ear when he's right
about to speak with the president, when he's just about to go up to
Capitol Hill.
As a result, explained the NYT: "A
year after the crisis struck, many of the industry's behemoths -- those
institutions deemed too big to fail -- are, in fact, getting bigger,
not smaller." MSNBC's Dylan Ratigan yesterday had a somewhat
melodramatic and oversimplified though still effective depiction of the
gigantic "legalized theft" that has taken place, but because both
parties are so heavily involved in all of this, are such beneficiaries
of it, there is no organized outlet for what ought to be the explosive
public rage, other than some GOP-exploited "tea parties":
UPDATE IV: Just a little bit more: the top economics official at the State Department is Robert Hormats, who spent the prior 27 years at Goldman Sachs, including as the Vice Chairman of Goldman's international arm. As William Greider wrote this week in The Nation,
Gene Spreling -- currently a top Geithner adviser (and former top aide
to Goldman CEO Robert Rubin when Rubin was Tresasury Secretary) -- was
paid close to $1 million last year by Goldman Sachs for consulting
work. Earlier in the week, Bloomberg documented
that "[s]ome of Treasury Secretary Timothy Geithner's closest aides,
none of whom faced Senate confirmation, earned millions of dollars a
year working for Goldman Sachs Group Inc., Citigroup Inc. and other
Wall Street firms." Also: "Geithner's predecessor, Henry Paulson,
brought on a coterie of non-confirmed advisers from Goldman Sachs at
the end of his term."
I don't understand why government policy so
relentlessly and lavishly redounds to the benefit of Goldman and a
handful of other investment banks. Might there be any causal
connection here?
Apparently, the U.S. government didn't have enough Goldman Sachs executives in key financial and regulatory positions, so the following happened this week:
A Goldman Sachs executive has been named the first chief operating officer of the Securities and Exchange Commission's enforcement division.
The
market watchdog says Adam Storch, vice president in Goldman Sachs'
Business Intelligence Group, is assuming the new position of managing
executive of the SEC division.The move comes as the SEC
revamps its enforcement efforts following the agency's failure to
uncover Bernard Madoff's massive fraud scheme for nearly two decades
despite numerous red flags.
A Goldman executive as COO of the SEC's enforcement division. This is all consistent with the observation of Desmond Lachman
-- previously chief emerging market strategist at Salomon Smith Barney
and IMF deputy director -- regarding "Goldman Sachs's seeming lock on
high-level U.S. Treasury jobs," which he cited as but one of the many
"parallels between U.S. policymaking and what we see in emerging
markets."
In October of last year, a Goldman Sachs Vice President, Neel Kashkari, was named by former Goldman CEO and then-Treasury Secretary Hank Pauslon to oversee the$700 billion TARP bailout. In January of this year, Tim Geithner hired a former Goldman Sachs lobbyist, Mark Patterson, to be his top aide and Chief of Staff. In March, President Obama nominated
Goldman Sachs executive Gary Gensler to head the Commodity Futures
Trading Commission, which regulates futures markets, even though
(or "because") Gensler confessed to lax regulation during the Clinton
administration over the very derivative instruments that caused the
financial crisis. In April, Goldman hired
as its top lobbyist Michael Paese, the top aide to Rep. Barney Frank on
the House Financial Services Committee which Frank chairs.
According to ABC News in October, 2008,
Goldman "spent more than $43 million dollars on lobbying and campaign
contributions to cultivate friends and buy influence in Washington,
D.C. since 1989" and their "bankers have been the country's top political campaign contributors
this year." "They are almost in a class by themselves," said Sheila
Krumholz, the executive director for the Center for Responsive
Politics. As Michael Moore has been pointing out,
Goldman was the number one source of funding for the Obama 2008
presidential campaign. The bailout of AIG -- which resulted in massive
federal government monies to Goldman -- was engineered at a meeting between Paulson, Geithner and Goldman CEO Lloyd Blankfein. Last year, Goldman paid top Obama economics adviser Larry Summers $135,000 for a one-day visit to Goldman.
Recently obtained calenders from Geithner reveal that
"Goldman, Citi and JPMorgan can get Geithner on the phone several times
a day if necessary, giving them an unmatched opportunity to influence
policy" and "Geithner's contacts with Blankfein alone outnumber his
contacts with Sen. Chris Dodd, D-Conn., chairman of the Senate Banking
Committee." Documents obtained byThe New York Times
relating to Geithner's work before becoming Treasury Secretary "show[]
that he forged unusually close relationships with executives of Wall
Street's giant financial institutions."
Of course, only an
irrational, raving conspiracy theorist would believe that any of those
events have any connection at all to this, from today's Washington Post:
The
nation's largest banks, preserved from failure by federal aid and
romping in markets revived by federal aid, are racking up vast profits
even as the broader economy struggles to emerge from recession . . .Goldman said it earned $3.19 billion between July and September, nearly the most it has ever made in three months, a record it set earlier this year.
So
the most profitable quarter Goldman Sachs ever had in its history was
the second quarter of 2009 -- just a few months after massive amounts
of taxpayer money were transferred to them and their counter-parties in
order to prop up their business, while several of its key competitors
were allowed to die. The second-most profitable quarter it ever had in
its history was the third quarter of 2009. In his seminal article in The Atlantic
earlier this year, former IMF economist and current MIT Professor Simon
Johnson warned (just like former IMF official Lachman did) that, for
deeply corrupt oligarchies in which the unrestrained power and
recklessness of the oligarchs spawn a financial crisis, this is what
happens: "at the outset of the crisis, the oligarchs are
usually among the first to get extra help from the government . . .
Meanwhile, needing to squeeze someone, most emerging-market governments
look first to ordinary working folk -- at least until the riots grow
too large."
Just compare Johnson's description for what
happens in corrupt oligarchies to the pictoral representation of
Goldman's profits since the September, 2008 financial crisis, from
today's Post:
Goldman employees are set to receive record bonuses this year as well. That occurred at the same time the unemployment rate went to 9.8%, the highest in 26 years. Is it possible to imagine a more vivid illustration of what Johnson described?
It's
true that the threat of worldwide economic collapse has abated, and
that's a good thing. It's not particularly surprising that if the
Government transfers trillions of dollars to an industry, then that
industry will improve. But, as the Treasury Department's independent
and tenacious watchdog, Neil Barofsky, has been trying to warn,
the surviving banks are bigger and more powerful than ever, thus
maximizing our dependence on them, and the primary stated goal of the
bailout (increasing lending) has not been achieved. Rep. Frank's
committee in the House yesterday passed a bill to regulate derivatives
that is so filled with loopholes
it may end up exempting most industry players. That the administration
continues, so brazenly, to place Goldman Sachs executives in the very
government positions with the greatest power over the financial
industry illustrates how little effort is devoted to hiding what is
really taking place.
UPDATE: Business Insiderhas more details on Storch,
the new COO of SEC Enforcement: He's 29, and has worked at Goldman
Sachs for the last 5 years -- since he was 24 years old. I'm sure
there was nobody more qualified for that position and that he'll be an
absolutely relentless and fearsome force in helping the SEC enforce
applicable laws and regulations.
UPDATE II:
I owe Adam Storch an apology for unfairly questioning whether he's
really the most qualified person for the position of COO in
SEC enforcement. After all, in 2002, he was named as a Co-Winner by
SUNY-Buffalo of the prestigious Intern of the Year Award, for his sterling summer work in sorting mail and fetching coffee at Deloitte & Touche (h/t thelastnamechosen).
UPDATE III: The New York Times this morning has a darkly amusing article
by Graham Bowley on all of this. I can't quite tell if the humor is
intentional, but either way, it's glaring. The article begins with
this observation: "Even as the economy continues to struggle, much of
Wall Street is minting money -- and looking forward again to hefty
bonuses." With an earnestly innocent tone, it then poses this
question: "Many Americans wonder how this can possibly be. How
can some banks be prospering so soon after a financial collapse, even
as legions of people worry about losing their jobs and their homes?" Indeed, how could such a confounding thing have happened? This way:
It may come as a surprise that one of the most powerful forces driving the resurgence on Wall Street is not the banks but Washington. Many of the steps that policy makers took
last year to stabilize the financial system -- reducing interest rates
to near zero, bolstering big banks with taxpayer money, guaranteeing
billions of dollars of financial institutions' debts -- helped set the stage for this new era of Wall Street wealth. . .So
even as big banks fight efforts in Congress to subject their industry
to greater regulation -- and to impose some restrictions on executive
pay -- Wall Street has Washington to thank in part for its latest bonanza.
That
is so very, very unexpected: that policies designed by former Goldman
CEO Hank Paulson, ultimate Wall Street servant Tim Geithner, and the banking-owned United States Congress
would redound to the personal benefit of investment banking executives
but not the general public. It's the opposite of free market
capitalism: it is the Federal Government intervening for the benefit of
a tiny sliver of oligarchs who fund and own the government itself. The
NYT article details the numerous ways that Washington policies
over the last year have directly maximized Goldman profits, while
the AP reporter who wrote the article on Geithner's calender records,
Matt Apuzzo, told this to NPR earlier this week, in a segment entitled "Bank Execs Had Direct Line to Geithner" (h/t Carolyn C):
What's
very interesting here is he seems to have this kitchen cabinet, if you
will, of these three big banks that he talks to, not just when it's
something about big banks, he talks to them during the auto crisis; he talks to them late at night; he talks to them first thing in the morning.There's
this great sequence of phone calls one night in the middle of the auto
crisis where the secretary takes three phone calls and it's Goldman
Sachs, JPMorgan, the president of the United States; hangs up with the
president and then he's immediately back on the phone with JPMorgan.And
when you look at it in that way, you can see that those three banks
have greater influence - they have a greater ability to influence
policy than any other bank. I mean, it's really an unmatched
ability to have the secretary of the Treasury's ear when he's right
about to speak with the president, when he's just about to go up to
Capitol Hill.
As a result, explained the NYT: "A
year after the crisis struck, many of the industry's behemoths -- those
institutions deemed too big to fail -- are, in fact, getting bigger,
not smaller." MSNBC's Dylan Ratigan yesterday had a somewhat
melodramatic and oversimplified though still effective depiction of the
gigantic "legalized theft" that has taken place, but because both
parties are so heavily involved in all of this, are such beneficiaries
of it, there is no organized outlet for what ought to be the explosive
public rage, other than some GOP-exploited "tea parties":
UPDATE IV: Just a little bit more: the top economics official at the State Department is Robert Hormats, who spent the prior 27 years at Goldman Sachs, including as the Vice Chairman of Goldman's international arm. As William Greider wrote this week in The Nation,
Gene Spreling -- currently a top Geithner adviser (and former top aide
to Goldman CEO Robert Rubin when Rubin was Tresasury Secretary) -- was
paid close to $1 million last year by Goldman Sachs for consulting
work. Earlier in the week, Bloomberg documented
that "[s]ome of Treasury Secretary Timothy Geithner's closest aides,
none of whom faced Senate confirmation, earned millions of dollars a
year working for Goldman Sachs Group Inc., Citigroup Inc. and other
Wall Street firms." Also: "Geithner's predecessor, Henry Paulson,
brought on a coterie of non-confirmed advisers from Goldman Sachs at
the end of his term."
I don't understand why government policy so
relentlessly and lavishly redounds to the benefit of Goldman and a
handful of other investment banks. Might there be any causal
connection here?
Apparently, the U.S. government didn't have enough Goldman Sachs executives in key financial and regulatory positions, so the following happened this week:
A Goldman Sachs executive has been named the first chief operating officer of the Securities and Exchange Commission's enforcement division.
The
market watchdog says Adam Storch, vice president in Goldman Sachs'
Business Intelligence Group, is assuming the new position of managing
executive of the SEC division.The move comes as the SEC
revamps its enforcement efforts following the agency's failure to
uncover Bernard Madoff's massive fraud scheme for nearly two decades
despite numerous red flags.
A Goldman executive as COO of the SEC's enforcement division. This is all consistent with the observation of Desmond Lachman
-- previously chief emerging market strategist at Salomon Smith Barney
and IMF deputy director -- regarding "Goldman Sachs's seeming lock on
high-level U.S. Treasury jobs," which he cited as but one of the many
"parallels between U.S. policymaking and what we see in emerging
markets."
In October of last year, a Goldman Sachs Vice President, Neel Kashkari, was named by former Goldman CEO and then-Treasury Secretary Hank Pauslon to oversee the$700 billion TARP bailout. In January of this year, Tim Geithner hired a former Goldman Sachs lobbyist, Mark Patterson, to be his top aide and Chief of Staff. In March, President Obama nominated
Goldman Sachs executive Gary Gensler to head the Commodity Futures
Trading Commission, which regulates futures markets, even though
(or "because") Gensler confessed to lax regulation during the Clinton
administration over the very derivative instruments that caused the
financial crisis. In April, Goldman hired
as its top lobbyist Michael Paese, the top aide to Rep. Barney Frank on
the House Financial Services Committee which Frank chairs.
According to ABC News in October, 2008,
Goldman "spent more than $43 million dollars on lobbying and campaign
contributions to cultivate friends and buy influence in Washington,
D.C. since 1989" and their "bankers have been the country's top political campaign contributors
this year." "They are almost in a class by themselves," said Sheila
Krumholz, the executive director for the Center for Responsive
Politics. As Michael Moore has been pointing out,
Goldman was the number one source of funding for the Obama 2008
presidential campaign. The bailout of AIG -- which resulted in massive
federal government monies to Goldman -- was engineered at a meeting between Paulson, Geithner and Goldman CEO Lloyd Blankfein. Last year, Goldman paid top Obama economics adviser Larry Summers $135,000 for a one-day visit to Goldman.
Recently obtained calenders from Geithner reveal that
"Goldman, Citi and JPMorgan can get Geithner on the phone several times
a day if necessary, giving them an unmatched opportunity to influence
policy" and "Geithner's contacts with Blankfein alone outnumber his
contacts with Sen. Chris Dodd, D-Conn., chairman of the Senate Banking
Committee." Documents obtained byThe New York Times
relating to Geithner's work before becoming Treasury Secretary "show[]
that he forged unusually close relationships with executives of Wall
Street's giant financial institutions."
Of course, only an
irrational, raving conspiracy theorist would believe that any of those
events have any connection at all to this, from today's Washington Post:
The
nation's largest banks, preserved from failure by federal aid and
romping in markets revived by federal aid, are racking up vast profits
even as the broader economy struggles to emerge from recession . . .Goldman said it earned $3.19 billion between July and September, nearly the most it has ever made in three months, a record it set earlier this year.
So
the most profitable quarter Goldman Sachs ever had in its history was
the second quarter of 2009 -- just a few months after massive amounts
of taxpayer money were transferred to them and their counter-parties in
order to prop up their business, while several of its key competitors
were allowed to die. The second-most profitable quarter it ever had in
its history was the third quarter of 2009. In his seminal article in The Atlantic
earlier this year, former IMF economist and current MIT Professor Simon
Johnson warned (just like former IMF official Lachman did) that, for
deeply corrupt oligarchies in which the unrestrained power and
recklessness of the oligarchs spawn a financial crisis, this is what
happens: "at the outset of the crisis, the oligarchs are
usually among the first to get extra help from the government . . .
Meanwhile, needing to squeeze someone, most emerging-market governments
look first to ordinary working folk -- at least until the riots grow
too large."
Just compare Johnson's description for what
happens in corrupt oligarchies to the pictoral representation of
Goldman's profits since the September, 2008 financial crisis, from
today's Post:
Goldman employees are set to receive record bonuses this year as well. That occurred at the same time the unemployment rate went to 9.8%, the highest in 26 years. Is it possible to imagine a more vivid illustration of what Johnson described?
It's
true that the threat of worldwide economic collapse has abated, and
that's a good thing. It's not particularly surprising that if the
Government transfers trillions of dollars to an industry, then that
industry will improve. But, as the Treasury Department's independent
and tenacious watchdog, Neil Barofsky, has been trying to warn,
the surviving banks are bigger and more powerful than ever, thus
maximizing our dependence on them, and the primary stated goal of the
bailout (increasing lending) has not been achieved. Rep. Frank's
committee in the House yesterday passed a bill to regulate derivatives
that is so filled with loopholes
it may end up exempting most industry players. That the administration
continues, so brazenly, to place Goldman Sachs executives in the very
government positions with the greatest power over the financial
industry illustrates how little effort is devoted to hiding what is
really taking place.
UPDATE: Business Insiderhas more details on Storch,
the new COO of SEC Enforcement: He's 29, and has worked at Goldman
Sachs for the last 5 years -- since he was 24 years old. I'm sure
there was nobody more qualified for that position and that he'll be an
absolutely relentless and fearsome force in helping the SEC enforce
applicable laws and regulations.
UPDATE II:
I owe Adam Storch an apology for unfairly questioning whether he's
really the most qualified person for the position of COO in
SEC enforcement. After all, in 2002, he was named as a Co-Winner by
SUNY-Buffalo of the prestigious Intern of the Year Award, for his sterling summer work in sorting mail and fetching coffee at Deloitte & Touche (h/t thelastnamechosen).
UPDATE III: The New York Times this morning has a darkly amusing article
by Graham Bowley on all of this. I can't quite tell if the humor is
intentional, but either way, it's glaring. The article begins with
this observation: "Even as the economy continues to struggle, much of
Wall Street is minting money -- and looking forward again to hefty
bonuses." With an earnestly innocent tone, it then poses this
question: "Many Americans wonder how this can possibly be. How
can some banks be prospering so soon after a financial collapse, even
as legions of people worry about losing their jobs and their homes?" Indeed, how could such a confounding thing have happened? This way:
It may come as a surprise that one of the most powerful forces driving the resurgence on Wall Street is not the banks but Washington. Many of the steps that policy makers took
last year to stabilize the financial system -- reducing interest rates
to near zero, bolstering big banks with taxpayer money, guaranteeing
billions of dollars of financial institutions' debts -- helped set the stage for this new era of Wall Street wealth. . .So
even as big banks fight efforts in Congress to subject their industry
to greater regulation -- and to impose some restrictions on executive
pay -- Wall Street has Washington to thank in part for its latest bonanza.
That
is so very, very unexpected: that policies designed by former Goldman
CEO Hank Paulson, ultimate Wall Street servant Tim Geithner, and the banking-owned United States Congress
would redound to the personal benefit of investment banking executives
but not the general public. It's the opposite of free market
capitalism: it is the Federal Government intervening for the benefit of
a tiny sliver of oligarchs who fund and own the government itself. The
NYT article details the numerous ways that Washington policies
over the last year have directly maximized Goldman profits, while
the AP reporter who wrote the article on Geithner's calender records,
Matt Apuzzo, told this to NPR earlier this week, in a segment entitled "Bank Execs Had Direct Line to Geithner" (h/t Carolyn C):
What's
very interesting here is he seems to have this kitchen cabinet, if you
will, of these three big banks that he talks to, not just when it's
something about big banks, he talks to them during the auto crisis; he talks to them late at night; he talks to them first thing in the morning.There's
this great sequence of phone calls one night in the middle of the auto
crisis where the secretary takes three phone calls and it's Goldman
Sachs, JPMorgan, the president of the United States; hangs up with the
president and then he's immediately back on the phone with JPMorgan.And
when you look at it in that way, you can see that those three banks
have greater influence - they have a greater ability to influence
policy than any other bank. I mean, it's really an unmatched
ability to have the secretary of the Treasury's ear when he's right
about to speak with the president, when he's just about to go up to
Capitol Hill.
As a result, explained the NYT: "A
year after the crisis struck, many of the industry's behemoths -- those
institutions deemed too big to fail -- are, in fact, getting bigger,
not smaller." MSNBC's Dylan Ratigan yesterday had a somewhat
melodramatic and oversimplified though still effective depiction of the
gigantic "legalized theft" that has taken place, but because both
parties are so heavily involved in all of this, are such beneficiaries
of it, there is no organized outlet for what ought to be the explosive
public rage, other than some GOP-exploited "tea parties":
UPDATE IV: Just a little bit more: the top economics official at the State Department is Robert Hormats, who spent the prior 27 years at Goldman Sachs, including as the Vice Chairman of Goldman's international arm. As William Greider wrote this week in The Nation,
Gene Spreling -- currently a top Geithner adviser (and former top aide
to Goldman CEO Robert Rubin when Rubin was Tresasury Secretary) -- was
paid close to $1 million last year by Goldman Sachs for consulting
work. Earlier in the week, Bloomberg documented
that "[s]ome of Treasury Secretary Timothy Geithner's closest aides,
none of whom faced Senate confirmation, earned millions of dollars a
year working for Goldman Sachs Group Inc., Citigroup Inc. and other
Wall Street firms." Also: "Geithner's predecessor, Henry Paulson,
brought on a coterie of non-confirmed advisers from Goldman Sachs at
the end of his term."
I don't understand why government policy so
relentlessly and lavishly redounds to the benefit of Goldman and a
handful of other investment banks. Might there be any causal
connection here?