Goldman Sachs, the Cayman Islands, and the Scam of the Century

by Robert Wilkinson

Some news transcends political opinions. Most definitely some events are lessons in Divine Discrimination for individuals as well as what it takes to create a healthy functioning society. At the risk of opening a hornet's nest of anger over what may be the biggest financial ripoff of all, here's something that blows the doors open on how Goldman Sachs bet against America and the World and won big.

McClatchy has been all over this for quite a while, and this "hot-off-the-press" article by Greg Gordon, In Goldman's Cayman deals, investors could only lose, exposes the game in all its ugly greed and offers us an overview of the quasi-ponzi scheme Goldman Sachs put over on the world. If you're ready for a wide open look at bald-faced corruption on a global scale, then you will want to read this article.

Here's a little:

McClatchy has obtained previously undisclosed documents that provide a closer look at the shadowy $1.3 trillion market since 2002 for complex offshore deals, which Chicago financial consultant and frequent Goldman critic Janet Tavakoli said at times met "every definition of a Ponzi scheme...."

While Goldman wasn't alone in the offshore deal making, it was the only big Wall Street investment bank to exit the subprime mortgage market safely, and it played a pivotal role, hedging its bets earlier and with more parties than any of its rivals did.

McClatchy reported on Nov. 1 that in 2006 and 2007, Goldman peddled more than $40 billion in U.S.-registered securities backed by at least 200,000 risky home mortgages, but never told the buyers it was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting. Many of those bets were made in the Caymans deals....

Goldman's activities in the Caymans helped it unload some of its subprime-related risks on others and also amass tens of billions of dollars in protection against a U.S. housing crash that ultimately occurred. These deals have accounted for a sizeable share of the firm's $103 billion in revenues and more than $25 billion in profits since Jan. 1, 2007. At the end of 2009, Goldman had set aside more than $16 billion in cash and stock bonuses for its employees....

Taxpayers got hit for tens of billions of dollars in the Caymans deals because Goldman and others bought up to $80 billion in insurance from American International Group on the risky home mortgage securities underlying the deals.... When the federal government saved nearly bankrupt AIG, Goldman got $13.9 billion of the bailout money, and it still holds more than $8 billion in protection from AIG.

There's a lot more on how everyone got robbed multiple ways by Goldman, so check it out if you want a time line and facts. That said, I probably won't respond to comments on this one, since all of it is just too heavy, to paraphrase Saint Jerry. But I still like to pass stuff like this on, since it exposes the mindset, rationalizations, strategies and tactics of ruthless manipulators who care not what havoc and suffering they generate. Not to overstate the obvious, but regarding money the world is at the mercy of obsessed greedy people who most definitely are NOT our friends.

These are times when it's important to be mindful regarding what we choose to invest in. There are many things that are not "paper investments" where our money, energy, and time would be well spent and where we would reap rewards beyond mere numbers tied to a floating decimal point. But that's another article for another time.

I'll just leave you with this: the best investment is to invest in yourself. Invest time, energy, and money in improving your body, mind, skills, and awarenesses, and you'll do well despite the machinations of the bankers.

© Copyright 2009 Robert Wilkinson

Comments

[caliban]

You are making me itch Robert. It was only a year ago the big bailout happened. They should never have messed with the rich, money is too darn important in that court.

Glad there are some troops out there still persisting even if only in word. Keep hearing, this is how you are being ripped off, but that's the way it is. It's a step up from the obedient media, but grrrrr. I try to remember that change takes a long time, but the process can be slow and painful. I think I'm back to meditating again.

[Preston]

Robert,
Clearly there are elements moving in the shadows that are shredding the fabric of this country while many sleep. Keep shining the light.
Preston