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Ллойд Бланкфейн
22 сентября, 22:38

Phillips 66 Partners To Buy Phillips 66 Assets In $2.4B Deal

Phillips 66 Partners (NYSE:PSXP), the master limited partnership of Phillips 66, said on Friday that it would buy assets from Phillips 66 (NYSE:PSX) in a deal valued at US$2.4 billion including debt, in the largest acquisition the partnership has ever made. Oil firms in the U.S. form master limited partnerships (MLPs) to buy and operate midstream assets. MLPs distribute excess cash to unitholders in the form of tax-deferred dividends. Phillips 66 Partners has reached a deal with Phillips 66 to buy the refiner’s 25-percent stake in each of…

22 сентября, 21:41

Oil Spills From Pipeline After Syria Army Retakes Oil Field From ISIS

Oil spilled from a pipeline at the al-Teym oil field in the oil-rich desert south of Deir al-Zor in Syria after the Syrian Arab Army and its allies had recaptured the oil site from ISIS, video footage uploaded on Friday on YouTube by Berlin-based video news agency Ruptly shows. Earlier this month, Syrian state TV reported that the Syrian army and its allies had retaken the Teym oil field as forces were advancing to clear the city of Deir al-Zor from Islamic State militants. According to the Syrian Observatory for Human Rights, the army also seized…

22 сентября, 21:00

Japan Court Slams Tepco With Fukushima Damages Bill

The Chiba District Court in Japan has ordered Tokyo Electric Power Company Holdings, or Tepco, to pay damages to a group of Fukushima prefecture residents who were forced to flee their homes after the 2011 nuclear disaster at the Fukushima Daiichi nuclear power plant. This is the second damages ruling against the utility, but unlike the first one, which came out in March, the Chiba court ruling did not find the Japanese government guilty of negligence. The court estimated the damages at US$3.36 million (376 million yen). The plaintiffs had asked…

22 сентября, 19:24

Total Joins Chevron In Gulf Of Mexico Development

French Total has expanded its presence in the Gulf of Mexico by closing a farm-in agreement with Chevron for the development of seven prospects covering 16 blocks in the deepwater section of the gulf. The French company said the prospects it will develop are located in the Wilcox play in the central Gulf of Mexico, next to the Anchor discovery, and in the Norphlet area, close to the Appomattox discovery. Total will take stakes of between 25 and 40 percent in the prospects, to add to its already existing interests in producing fields in the GOM:…

20 сентября, 03:44

Government By Goldman

Authored by Gary Rivlin and Michael Hudson via The Intercept, in partnership with The Investigative Fund, Steve Bannon was in the room the day Donald Trump first fell for Gary Cohn. So were Reince Priebus, Jared Kushner, and Trump’s pick for secretary of Treasury, Steve Mnuchin. It was the end of November, three weeks after Trump’s improbable victory, and Cohn, then still the president of Goldman Sachs, was at Trump Tower presumably at the invitation of Kushner, with whom he was friendly. Cohn was there to offer his views about jobs and the economy. But, like the man he was there to meet, he was at heart a salesman. On the campaign trail, Trump had spoken often about the importance of investing in infrastructure. Yet the president-elect had apparently failed to appreciate that the government would need to come up with hundreds of billions of dollars to fund his plans. Cohn, brash and bold, wired to attack any moneymaking opportunity, pitched a fix that would put Wall Street firms at the center: Private-industry partners could help infrastructure get fixed, saving the federal government from going deeper into debt. The way the moment was captured by the New York Times, among other publications, Trump was dumbfounded. “Is this true?” he asked. Was a trillion-dollar infrastructure plan likely to increase the deficit by a trillion dollars? Confronted by nodding heads, an unhappy president-elect said, “Why did I have to wait to have this guy tell me?” Within two weeks, the transition team announced that Cohn would take over as director of the president’s National Economic Council. Goldman Sachs President Gary Cohn arrives for a meeting with President-elect Donald Trump at Trump Tower in New York,  Nov. 29, 2016. Photo: Bryan R. Smith/AFP/Getty Images 1. GOLDMAN ALWAYS WINS Goldman Sachs had been a favorite cudgel for candidate Trump - the symbol of a government that favors Wall Street over its citizenry. Trump proclaimed that Hillary Clinton was in the firm’s pockets, as was Ted Cruz. It was Goldman Sachs that Trump singled out when he railed against a system rigged in favor of the global elite — one that “robbed our working class, stripped our country of wealth, and put money into the pockets of a handful of large corporations and political entities.” Cohn, as president and chief operating officer of Goldman Sachs, had been at the heart of it all. Aggressive and relentless, a former aluminum siding salesman and commodities broker with a nose for making money, Cohn had turned Goldman’s sleepy home loan unit into what a Senate staffer called “one of the largest mortgage trading desks in the world.” There, he aggressively pushed his sales team to sell mortgage-backed securities to unaware investors even as he watched over “the big short,” Goldman’s decision to bet billions of dollars that the market would collapse. Now Cohn would be coordinating economic policy for the populist president. The conflicts between the two men were striking. Cohn ran a giant investment bank with offices in financial capitals around the globe, one deeply committed to a world with few economic borders. Trump’s nationalist campaign contradicted everything Goldman Sachs and its top executives represented on the global stage. Trump raged against “offshoring” by American companies during the 2016 campaign. He even threatened “retribution,”­ a 35 percent tariff on any goods imported into the United States by a company that had moved jobs overseas. But Cohn laid out Goldman’s very different view of offshoring at an investor conference in Naples, Florida, in November. There, Cohn explained unapologetically that Goldman had offshored its back-office staff, including payroll and IT, to Bangalore, India, now home to the firm’s largest office outside New York City: “We hire people there because they work for cents on the dollar versus what people work for in the United States.” Candidate Trump promised to create millions of new jobs, vowing to be “the greatest jobs president that God ever created.” Cohn, as Goldman Sachs’s president and COO, oversaw the firm’s mergers and acquisitions business that had, over the previous three years, led to the loss of at least 22,000 U.S. jobs, according to a study by two advocacy groups. Early in his candidacy, Trump described as “disgusting” Pfizer’s decision to buy a smaller Irish competitor in order to execute a “corporate inversion,” a maneuver in which a U.S. company moves its headquarters overseas to reduce its tax burden. The Pfizer deal ultimately fell through. But in 2016, in the heat of the campaign, Goldman advised on a megadeal that saw Johnson Controls, a Fortune 500 company based in Milwaukee, buy the Ireland-based Tyco International with the same goal. A few months later, with Goldman’s help, Johnson Controls had executed its inversion. With Cohn’s appointment, Trump now had three Goldman Sachs alums in top positions inside his administration: Steve Bannon, who was a vice president at Goldman when he left the firm in 1990, as chief strategist, and Steve Mnuchin, who had spent 17 years at Goldman, as Treasury secretary. And there were more to come. A few weeks later, another Goldman partner, Dina Powell, joined the White House as a senior counselor for economic initiatives. Goldman was a longtime client of Jay Clayton, Trump’s choice to chair the Securities and Exchange Commission; Clayton had represented Goldman after the 2008 financial crisis, and his wife Gretchen worked there as a wealth management adviser. And there was the brief, colorful tenure of Anthony Scaramucci as White House communications director: Scaramucci had been a vice president at Goldman Sachs before leaving to co-found his own investment company. Even before Scaramucci, Sen. Elizabeth Warren, D-Mass., had joked that enough Goldman alum were working for the Trump administration to open a branch office in the White House. “There was a devastating financial crisis just over eight years ago,” Warren said. “Goldman Sachs was at the heart of that crisis. The idea that the president is now going to turn over the country’s economic policy to a senior Goldman executive turns my stomach.” Prior administrations often had one or two people from Goldman serving in top positions. George W. Bush at one point had three. At its peak, the Trump administration effectively had six. Earlier this summer, Trump boasted about his team of economic advisers at a rally in Cedar Rapids, Iowa. “This is the president of Goldman Sachs. Smart,” Trump said. “Having him represent us! He went from massive paydays to peanuts.” Trump waved off anyone who might question his decision to rely on the very people he had demonized. “Somebody said, ‘Why did you appoint a rich person to be in charge of the economy?’ … I said: ‘Because that’s the kind of thinking we want.’” He needed “great, brilliant business minds … so the world doesn’t take advantage of us.” How else could he get the job done? “I love all people, rich or poor, but in those particular positions, I just don’t want a poor person.” “Does that make sense?” Trump asked. The crowd cheered. Director of the National Economic Council Gary Cohn (L) listens to President Donald Trump deliver opening remarks during a meeting with business leaders in the Roosevelt Room at the White House on Jan. 23, 2017 in Washington, D.C. Photo: Chip Somodevilla/Getty Images Years of financial disclosure forms confirm that Cohn is indeed very rich. At the end of 2016, he owned some 900,000 shares of Goldman Sachs stock, a stake worth around $220 million on the day Trump announced his appointment. Plus, he’d sold a million more Goldman shares over the previous half-dozen years. In 2007 alone, the year of the big short, Goldman Sachs paid him nearly $73 million — more than the firm paid CEO Lloyd Blankfein. The disclosure forms Cohn filled out to join the administration indicate he owned assets valued at $252 million to $611 million. That may or may not include the $65 million parting gift Goldman’s board of directors gave him for “outstanding leadership” just days before Trump was sworn in. Like anyone taking a top job in the Trump administration, Cohn was required to sign a pledge vowing not to participate for the next two years in any matter “that is directly and substantially related to my former employer or former clients, including regulations and contracts.” But presidents have sometimes issued waivers to these requirements, and it is unclear whether the Trump administration is making such waivers public. Sens. Warren and Tammy Baldwin, a Democrat from Wisconsin, sent Cohn a letter a few days later. They brought up the $65 million bonus and asked him to publicly recuse himself from any issue that could have a direct or “significant indirect” impact on his old firm. Cohn never responded to the letter, and if he has ever received a waiver, it has not been made available to the public or the Office of Government Ethics. “Consistent with the Trump administration’s stringent ethics rules, Mr. Cohn will recuse himself from participating in any matter directly involving his former employer, Goldman Sachs,” White House spokesperson Natalie Strom said. “The White House will not comment further.” The White House declined requests to make Cohn available for an interview and declined to answer a detailed set of questions. Cohn shared the podium with fellow Goldman alum Mnuchin (the two made partner there the same year) when the administration unveiled its new tax plan, one that, if the past is prelude, had the potential to save Goldman more than $1 billion a year in corporate taxes. The president had promised to “do a number” on financial reforms implemented after the 2008 subprime crisis, including one that threatened to cost Goldman several billion dollars a year in revenues. Under Cohn, the administration has introduced new rules easing initial public offerings — a Goldman Sachs specialty dating back to the start of the last century, when the firm handled the IPOs of Sears, Roebuck; F. W. Woolworth; and Studebaker. As Trump’s top economic policy adviser, Cohn can exert influence over regulatory agencies that have shaken billions in penalties and settlements out of Goldman Sachs in recent years. And his former colleagues inside Goldman’s Public Sector and Infrastructure group likely appreciate the Trump administration’s infrastructure plan, which is more or less exactly as Cohn first pitched it inside Trump Tower in November. “It’s hard to see how Gary Cohn recusing himself would solve a lot of these conflicts because nearly every major decision of his job would have a significant impact, likely billions of dollars, on Goldman Sachs and its executives,” said Tyler Gellasch, an attorney and former Senate staffer who helped draft Dodd-Frank, the landmark financial reform law passed in the wake of the financial meltdown. “Goldman touches nearly every aspect of the economy, from selling U.S. treasuries to helping companies go public, and the National Economic Council advises on all of that.” In the wake of last month’s white supremacist rally in Charlottesville, Virginia, Cohn confessed to the Financial Times that he has “come under enormous pressure both to resign and to remain.” But the man who the Washington Post has dubbed Trump’s “moderate voice” declared that neo-Nazis would not force “this Jew” to leave his job. “As a patriotic American, I am reluctant to leave my post as director of the National Economic Council,” Cohn told FT. “I feel a duty to fulfill my commitment to work on behalf of the American people.” Or at least a few of them. The Trump economic agenda, it turns out, is largely the Goldman agenda, one with the potential to deliver any number of gifts to the firm that made Cohn colossally rich. If Cohn stays, it will be to pursue an agenda of aggressive financial deregulation and massive corporate tax cuts — he seeks to slash rates by 57 percent — that would dramatically increase profits for large financial players like Goldman. It is an agenda as radical in its scope and impact as Bannon’s was. Republican presidential candidate Donald Trump holds up a copy of his book “The Art of the Deal,” given to him by a fan as he speaks during a campaign stop on Saturday, Nov. 21, 2015 in Birmingham, Ala. Photo: Eric Schultz/AP 2. ALPHA MALES Donald Trump, the “blue-collar billionaire,” has taken great pains to write grit and toughness into his privileged biography. He talks of military schools and visits to construction sites with his father and wrote in “The Art of the Deal” that in the second grade, “I actually gave a teacher a black eye. I punched my music teacher because I didn’t think he knew anything about music and I almost got expelled.” Yet when the authors of the book “Trump Revealed: An American Journey of Ambition, Ego, Money, and Power” spoke to several of his childhood friends, none of them recalled the incident. Trump himself crumpled when asked about the incident during the 2016 campaign: “When I say ‘punch,’ when you’re that age, nobody punches very hard.” Gary Cohn, however, is the middle-class kid and self-made millionaire Trump imagines himself to be. It appears that Cohn actually did slug a grade-school teacher in the face. “I was being abused,” Cohn told author Malcolm Gladwell, who interviewed him for his book, “David and Goliath: Underdogs, Misfits, and the Art of Battling Giants,” back when Cohn was still president of Goldman Sachs. As a child, Cohn struggled with dyslexia, a reading disorder people didn’t understand much about when Cohn attended school in the 1970s in a suburb outside Cleveland. “You’re a 6- or 7- or 8-year-old-kid, and you’re in a public-school setting, and everyone thinks you’re an idiot,” Cohn confessed to Gladwell. “You’d try to get up every morning and say, today is going to be better, but after you do that a couple of years, you realize that today is going to be no different than yesterday.” One time when he was in the fourth grade, a teacher put him under her desk, rolled her chair close, and started kicking him, Cohn said. “I pushed the chair back, hit her in the face, and walked out.” While Trump’s father was a wealthy real estate developer, Cohn’s father was an electrician. When Trump sought to get into the casino business, his father loaned him $14 million. When Cohn couldn’t find a job after graduating from college, all his father could do was find him one selling aluminum siding. While Trump has the instincts of a reality show producer and an eye for spectacle, Cohn prefers to operate in the shadows. But they likely recognize much of themselves in the other. Both Cohn and Trump are alpha males — men of action unlikely to be found holed up in an office reading through stacks of policy reports. In fact, neither seems to be much of a reader. Cohn told Gladwell it would take him roughly six hours to read just 22 pages; he ended his time with the author by wishing him luck on “your book I’m not going to read.” Both have a transactional view of politics. Trump switched his voter registration between Democratic, Republican, and independent seven times between 1999 and 2012. In the 2000s, his foundation gave $100,000 to the Clinton Foundation, and he contributed $4,700 to Hillary Clinton’s senatorial campaigns. He even bought and refurbished a golf course in Westchester County a few miles from the Clinton home, in part, Trump once admitted, to ingratiate himself with the Clintons. Cohn is a registered Democrat who has given at least $275,000 to Democrats over the years, including to the campaigns of Hillary Clinton and Barack Obama, but also around $250,000 to Republicans, including Senate Majority Leader Mitch McConnell and Florida Sen. Marco Rubio. There are also striking similarities in their business histories. Both have a knack for weathering scandals and setbacks and coming out on top. Trump has filed for bankruptcy four times, started a long list of failed businesses (casinos, an airline, a football team, a steak company), but managed, through his best-selling books and highly rated reality TV show, to recast himself as the world’s greatest businessman. During Cohn’s tenure as president, Goldman Sachs faced lawsuits and federal investigations that resulted in $9 billion in fines for misconduct in the run-up to the subprime meltdown. Goldman not only survived but thrived, posting record profits — and Cohn was rewarded with handsome bonuses and a position at the top of the new administration. Cohn’s path to the White House started with a tale of brass and bluster that would make Trump the salesman proud. Still in his 20s and stuck selling aluminum siding, Cohn made a play that would change his life. In the fall of 1982, while visiting the company’s home office on Long Island, he stole a day from work and headed to the U.S. commodities exchange in Manhattan, hoping to talk himself into a job. He overheard an important-looking man say he was heading to LaGuardia Airport; Cohn blurted out that he was headed there, too. He jumped into a cab with the man and, Cohn told Gladwell, who devoted six pages of “David and Goliath” to Cohn’s underdog rise, “I lied all the way to the airport.” The man confided to Cohn that his firm had just put him in charge of a market, options, that he knew little about. Cohn likely knew even less, but he assured his backseat companion that he could get him up to speed. Cohn then spent the weekend reading and re-reading a book called “Options as a Strategic Investment.” Within the week, he’d been hired as the man’s assistant. Cohn soon learned enough to venture off on his own and established himself as an independent silver trader on the floor of the New York Commodities Exchange. In 1990, Goldman Sachs, arguably the most elite firm on Wall Street, offered him a job. The Goldman Sachs & Co. logo at the company’s booth on the floor of the New York Stock Exchange in New York City, on Friday, July 19, 2013. Photo: Scott Eells/Bloomberg/Getty Images Goldman Sachs was founded in the years just after the American Civil War. Marcus Goldman, a Jewish immigrant from Germany, leased a cellar office next to a coal chute in 1869. There, in an office one block from Wall Street, he bought the bad debt of local businesses that needed quick cash. His son-in-law, Samuel Sachs, joined the firm in 1882. A generation later, in 1906, the firm made its first mark, arranging for the public sale of shares in Sears, Roebuck. Goldman Sachs’s influence over politics dates back at least to 1914. That year, Henry Goldman, the founder’s son, was invited to advise Woodrow Wilson’s administration about the creation of a central bank, mandated by the Federal Reserve Act, which had passed the previous year. Goldman Sachs men have played important roles in U.S. government ever since. There was the occasional scandal, such as Goldman Sachs’s role in the 1970 collapse of Penn Central railroad, then the largest corporate bankruptcy in U.S. history. Still, the firm built a reputation as a sober, elite partnership that served its clients ably. In 1979, when John Whitehead, a senior partner and co-chairman, set to paper what he called Goldman’s “Business Principles,” he began with the firm’s most cherished belief: The client’s interests come before all else. Two years later, Goldman took a step that signaled the beginning of the end of that culture. In the fall of 1981, Goldman purchased J. Aron & Co., a commodities trading firm. Some within the partnership were against the acquisition, worried over how profane, often crude, trading culture would mix with Goldman’s restrained, well-mannered way of doing business. “We were street fighters,” one former J. Aron partner told Fortune magazine in 2008. The J. Aron team moved into the Goldman Sachs offices in lower Manhattan, but didn’t adopt its culture. Within a few years, it was producing well over $1 billion a year in profits. They were 300 employees inside a firm of 6,000, but were posting one-third of Goldman’s total profits. The cultural shift, it turned out, was moving in the other direction. J. Aron, according to a book by Charles D. Ellis, a former Goldman consultant, brought to Goldman “a trading culture that would become dominant in the firm.” Lloyd Blankfein, who ascended to chairman and CEO in in 2006, started his Goldman career at J. Aron, a year after Goldman acquired the firm. “We didn’t have the word ‘client’ or ‘customer’ at the old J. Aron,” Blankfein told Fortune magazine two years after taking over as CEO. “We had counter-parties.” Cohn joined J. Aron eight years after Blankfein did, in 1990. Four years later, Blankfein was put in charge of the firm’s Fixed Income, Currency, and Commodities division, which included J. Aron. Cohn, loyal and hard-working, with an instinct for connecting with people who can help him, became Blankfein’s “corporate problem solver.” The emergence of “Bad Goldman” — and Cohn’s central role in that drama — is really the story of the rise of the traders inside the firm. “As trading came to be a bigger part of Wall Street, I noticed that the vision changed,” said Robert Kaplan, a former Goldman Sachs vice chairman, who left in 2006 after working at the firm for 23 years. “The leaders were saying the same words, but they started to change incentives away from the value-added vision and tilt more to making money first. If making money is your vision, what lengths will you not go?” At the height of the dot-com years, a debate raged within the firm. The firm underwrote dozens of technology IPOs, including Microsoft and Yahoo, in the 1980s and 1990s, minting an untold number of multimillionaires and the occasional billionaire. Some of the companies they were bringing public generated no profits at all, while Goldman was generating up to $3 billion in profits a year. It seemed inevitable that some within Goldman Sachs began to dream of jettisoning the Goldman’s century-old partnership structure and taking their firm public, too. Jon Corzine was running the firm then — he would later go into politics in the Goldman tradition, first as a U.S. senator and then as New Jersey governor — and was four-square in favor of going public. Corzine’s second in command, Henry Paulson — who would go on to serve as Treasury secretary — was against the idea. But Corzine ordered up a study that supported his view that remaining private stifled Goldman’s competitive opportunities and promoted Paulson to co-senior partner. Paulson soon got on board. In May 1999, Goldman sold $3.7 billion worth of shares in the company. At the end of the first day of trading, Corzine’s and Paulson’s stakes in the firm were each worth $205 million. Cohn’s and Mnuchin’s shares were each worth $112 million. And Blankfein ended up with $168 million in company stock. Like any publicly traded company, there would now be pressure on Goldman Sachs to make its quarterly numbers and “maximize shareholder value.” Discarding the partner model also meant the loss of a valuable restraint on risk-taking and bad behavior. Under the old system, any losses or fines came out of the partners’ pockets. In the early 1990s, for example, the firm was involved in transactions with Robert Maxwell, a London-based media mogul who was accused of stealing hundreds of millions of pounds from his companies’ pension funds. The $253 million that Goldman Sachs paid to settle lawsuits brought by pension funds over its involvement was split among the firm’s 84 limited partners. Now any losses are paid by a publicly traded entity owned by shareholders, with no direct financial liability for the decision-makers themselves. In theory, Goldman could claw back bonuses in response to executives’ bad behavior. But in 2016, when Goldman paid over $5 billion to settle charges brought by the Justice Department that the firm misled customers in the sale of a subprime mortgage product during Cohn’s time overseeing that unit, the Goldman board declined to dock Cohn’s pay. Instead, the company awarded him a $5.5 million cash bonus and another $12.6 million in company stock. The Goldman Sachs Group Inc. executives, from right, Gary Cohn, president and co-chief operating officer, Lloyd Blankfein, chairman and chief executive officer, and Jon Winkelreid, president and co-chief operating officer, appear in a 2006 annual report arranged for a photograph in New York, on June 16, 2008. Photo: Daniel Acker/Bloomberg/Getty Images As Blankfein moved up the corporate hierarchy, Cohn rose along with him. When Blankfein was made vice chairman in charge of the firm’s multibillion-dollar global commodities business and its equities division, Cohn took over as co-head of FICC, Blankfein’s previous position. That meant Cohn was overseeing not just J. Aron and the firm’s commodities business, but also its currency trades and bond sales. By the start of 2004, Blankfein was promoted to president and COO, and Cohn was named co-head of global securities. At that point, Cohn had authority over the mortgage-trading desk. Under Cohn, the firm aggressively moved into the subprime mortgage market, using Goldman’s own money and that of its customers to help stoke the housing bubble. Goldman was already enabling subprime predators, such as Ameriquest and New Century Financial, by providing them with the cash infusions they needed to scale up their lending to individual home buyers. Cohn would steer the firm deeper into the subprime frenzy by setting up Goldman as a patron of some of these same mortgage originators. During his tenure, Goldman snapped up loans from New Century, Countrywide, and other notorious mortgage originators and bundled them into deals with opaque names, such as ABACUS and GSAMP. Under Cohn’s watchful eye, Goldman’s brokers then funneled slices to customers they sold on the wisdom of holding mortgage-backed securities in their portfolios. One such creation, GSAA Home Equity Trust 2006-2, illustrates Goldman’s disregard for the quality of loans it was buying and packaging into security deals. Created in early 2006, the investment vehicle was made up of more than $1 billion in home loans Goldman had bought from Ameriquest, one of the nation’s largest and most aggressive subprime lenders. By that point, the lender already had set aside $325 million to settle a probe by attorneys general and banking regulators in 49 states, who accused Ameriquest of misleading thousands of borrowers about the costs of their loans and falsifying home appraisals and other key documents. Yet GSAA Home Equity Trust 2006-2 was filled with Ameriquest loans made to more than 3,000 homeowners in Arizona, Illinois, Florida, and elsewhere. By the end of 2008, 65 percent of the roughly 1,400 borrowers whose loans remained in the deal were in default, had filed for bankruptcy, or had been targeted for foreclosure. In just three years, Goldman Sachs had increased its trading volume by a factor of 50, which the Wall Street Journal attributed to “Cohn’s successful push to rev up risk-taking and use of Goldman’s own capital to make a profit” — what the industry calls proprietary trading, or prop trading. The 2010 Journal article quoted Justin Gmelich, then the firm’s mortgage chief, who said of Cohn, “He reshaped the culture of the mortgage department into more of a trading environment.” In 2005, with Cohn overseeing the firm’s home loan desk, Goldman underwrote $103 billion in mortgage-backed securities and other more esoteric products, such as collateralized debt obligations, which often were priced based on giant pools of home loans. The following year, the firm underwrote deals worth $131 billion. In 2006, CEO Henry Paulson left the firm to join George W. Bush’s cabinet as Treasury secretary. Blankfein, Cohn’s mentor and friend, took Paulson’s place. By tradition, Blankfein, a trader, should have elevated someone from the investment banking side to serve as his No. 2, so both sides of the firm would be represented in the top leadership. Instead he named Cohn, his long-time loyalist, and Jon Winkelried, who also had history on the trading side, as co-presidents and co-COOs. Winkelried, who had started at Goldman eight years before Cohn, had probably earned the right to hold those titles by himself. But Cohn had the advantage of his relationship with the CEO. Blankfein and Cohn vacationed together in the Caribbean and Mexico, owned homes near each other in the Hamptons, and their children attended the same school. Winkelreid was out in two years. The bromance between his fellow No. 2 and the top boss may have proved too much. With Blankfein and Cohn at the top, the transformation of Goldman Sachs was complete. By 2009, investment banking had shrunk to barely 10 percent of the firm’s revenues. Richard Marin, a former executive at Bear Stearns, a Goldman competitor that wouldn’t survive the mortgage meltdown, saw Cohn as “the root of the problem.” Explained Marin, “When you become arrogant in a trading sense, you begin to think that everybody’s a counterparty, not a customer, not a client. And as a counterparty, you’re allowed to rip their face off.” Weeds grow in the driveway of a foreclosed home May 7, 2009 in Antioch, Calif. Photo: Justin Sullivan/Getty Images 3. THE BIG SHORT People inside Goldman Sachs were growing nervous. It was the fall of 2006 and, as Daniel Sparks, the Goldman partner overseeing the firm’s 400-person mortgage trading department, wrote in an email to several colleagues, “Subprime market getting hit hard.” The firm had lent millions to New Century, a mortgage lender dealing in the higher-risk subprime market. And now New Century was late on payments. Sparks could see that the wobbly housing market was having an impact on his department. For 10 consecutive trading days, his people had lost money. The dollar amounts were small to a behemoth like Goldman: between $5 million and $30 million a day. But the trend made Sparks jittery enough to share his concerns with the Goldman’s top executives: President Gary Cohn; David Viniar, the firm’s chief financial officer; and CEO Lloyd Blankfein. Sparks, a Cohn protégé, was running the mortgage desk that his mentor, only a few years earlier, had built into a major profit center for the bank. In 2006 and 2007, a report by the Senate Permanent Subcommittee on Investigations found, the two “maintained frequent, direct contact” as Goldman worked to jettison the billions in subprime loans it had on its book. “One of my jobs at the time was to make sure Gary and David and Lloyd knew what was going on,” Sparks told William Cohan, author of the 2011 book “Money and Power: How Goldman Sachs Came to Rule the World.” “They don’t like surprises.” Viniar summoned around 20 traders and managers to a 30th floor conference room inside Goldman headquarters in lower Manhattan. It was there, on an unseasonably warm Thursday in December 2006, that the firm decided to initiate what people inside Goldman would eventually dub “the big short.” One name tossed around during the three-hour meeting was that of John Paulson. Paulson (no relation to Goldman’s former CEO) would later attain infamy when it was revealed that his firm, Paulson & Co., made roughly $15 billion betting against the mortgage market. (His personal take was nearly $4 billion.) At that point, though, Paulson was a little-known hedge fund manager who crossed Goldman’s radar when he asked the firm to create a product that would allow him to take a “short position” on the real estate market — laying down bets that a large number of mortgage investments were going to plummet in value. Goldman sold Paulson what’s called a credit-default swap, essentially an insurance policy that would pay off if homeowners defaulted on their mortgages in large enough numbers. The firm would create several more swaps on his behalf in the intervening months. Eventually, as mortgage defaults began to mount, people inside Goldman Sachs came to see Paulson as more of a prophet than a patsy. Some sitting around the conference table that December day wanted to follow his lead. “There will be big opportunities the next several months,” one Goldman manager at the meeting wrote enthusiastically in an email sent shortly after it ended. Sparks weighed in by email later that night. He wanted to make sure Goldman had enough “dry powder” — cash on hand — to be “ready for the good opportunities that are coming.” That Sunday, Sparks copied Cohn on an email reporting the firm’s progress on laying down short positions against mortgage-backed securities it had put together. The trading desk had already made $1.5 billion in short bets, “but still more work to do.” Cohn was a member of Goldman’s board of directors during this critical time and second in command of the bank. At that point, Cohn and Blankfein, along with the board and other top executives, had several options. They might have shared their concerns about the mortgage market in a filing with the SEC, which requires publicly traded companies to reveal “triggering events that accelerate or increase a direct financial obligation” or might cause “impairments” to the bottom line. They might have warned clients who had invested in mortgage-backed securities to consider extracting themselves before they suffered too much financial damage. At the very least, Goldman could have stopped peddling mortgage-backed securities that its own mortgage trading desk suspected might soon collapse in value. Instead, Cohn and his colleagues decided to take care of Goldman Sachs. Goldman would not have suffered the reputational damage that it did — or paid multiple billions in federal fines — if the firm, anticipating the impending crisis, had merely shorted the housing market in the hopes of making billions. That is what investment banks do: spot ways to make money that others don’t see. The money managers and traders featured in the film “The Big Short” did the same — and they were cast as brave contrarians. Yet unlike the investors featured in the film, Goldman had itself helped inflate the housing bubble — buying tens of billions of dollars in subprime mortgages over the previous several years for bundling into bonds they sold to investors. And unlike these investors, Goldman’s people were not warning anyone who would listen about the disaster about to hit. As federal investigations found, the firm, which still claims “our clients’ interests always come first” as a core principle, failed to disclose that its top people saw disaster in the very products its salespeople were continuing to hawk. Goldman still held billions of mortgages on its books in December 2006 — mortgages that Cohn and other Goldman executives suspected would soon be worth much less than the firm had paid for them. So, while Cohn was overseeing one team inside Goldman Sachs preoccupied with implementing the big short, he was in regular contact with others scrambling to offload its subprime inventory. One Goldman trader described the mortgage-backed securities they were selling as “shitty.” Another complained in an email that they were being asked to “distribute junk that nobody was dumb enough to take first time around.” A December 28 email from Fabrice “Fabulous Fab” Tourre, a Goldman vice president later convicted of fraud, instructed traders to focus on less astute, “buy and hold” investors rather than “sophisticated hedge funds” that “will be on the same side of the trade as we will.” Gary Cohn, president and chief operating officer of Goldman Sachs Group Inc. (R) and Craig Broderick, managing director and head of credit, market and operational risk with Goldman Sachs, during a Financial Crisis Inquiry Commission hearing on the role of derivatives in the financial crisis, on June 30, 2010. Photo: Andrew Harrer/Bloomberg/Getty Images At Goldman Sachs, Cohn was known as a hands-on boss who made it his business to walk the floors, talking directly with traders and risk managers scattered throughout the firm. “Blankfein’s role has always been the salesperson and big-thinker conceptualizer,” said Dick Bove, a veteran Wall Street analyst who has covered Goldman Sachs for decades. “Gary was the guy dealing with the day-to-day operations. Gary was running the company.” While making his rounds, Cohn would sometimes hike a leg up on a trader’s desk, his crotch practically in the person’s face. At 6-foot- 2, bullet-headed and bald with a heavy jaw and a fighter’s face, Cohn cut a large figure inside Goldman. Profiles over the years would describe him as aggressive, abrasive, gruff, domineering — the firm’s “attack dog.” He was the missile Blankfein launched when he needed to deliver bad news or enforce discipline. Cohn embodied the new Goldman: the man who would run through a brick wall if it meant a big payoff for the bank. A Bloomberg profile described his typical day as 11 or 12 hours in the office, a bank-related dinner, then phone calls and emails until midnight. “The old adage that hard work will get you what you want is 100 percent true,” Cohn said in a 2009 commencement address at American University. “Work hard, ask questions, and take risk.” There’s no record of how often Cohn visited his stomping grounds after hours in the early months of 2007, but emails reveal an executive demanding — and getting — regular updates. On February 7, one of the largest originators of subprime loans, HSBC, reported a greater than anticipated rise in troubled loans in its portfolio, and another, New Century, restated its earnings for the previous three quarters to “correct errors.” Sparks wrote an email to Cohn and others the next morning to reassure them that his team was closely monitoring the pricing of the company’s “scratch-and-dent book” and already had a handle on which loans were defaults and which could still be securitized and offloaded onto customers. An impatient Cohn sent a two-word email at 5 o’clock that evening: “Any update?” The next day, an internal memo circulated that listed dozens of mortgage-backed securities with the exhortation, “Let all of the respective desks know how we can be helpful in moving these bonds.” A week later, Sparks updated Cohn on the billions in shorts his firm had bought but warned that it was hurting sales of its “pipeline of CDOs,” the collateralized debt obligations the firm had created in order to sell the mortgages still on its books. In early March, Cohn was among those who received an email spelling out the mortgage products the firm still held. The stockpile included $1.7 billion in mortgage-related securities, along with $1.3 billion in subprime home loans and $4.3 billion in “Alt-A” loans that fall between prime and subprime on the risk scale. Goldman was “net short,” according to that same email, with $13 billion in short positions, but its exposure to the mortgage market was still considerable. Sparks and others continued to update Cohn on their success offloading securities backed by subprime mortgages through the third quarter of 2007. One product Goldman priced at $94 a share on March 31, 2007 was worth just $15 five months later. Pension funds and insurance companies were among those losing billions of dollars on securities Goldman put together and endorsed as a safe, AAA-rated investments. U.S. Treasury Secretary Henry M. Paulson steps off the stage Dec. 6, 2007 after a press conference on subprime mortgage loans at the Treasury Department in Washington, D.C. Photo: Mandel Ngan/AFP/Getty Images The third quarter of 2007 was ugly. A pair of Bear Stearns hedge funds failed. Merrill Lynch reported $2.2 billion in losses — its largest quarterly loss ever. Merrill’s CEO warned that the bank faced another $8 billion in potential losses due to the firm’s exposure to subprime mortgages and resigned several weeks later. The roiling credit crisis also took down the CEO of Citigroup, which reported $6.5 billion in losses and then weeks later, warned of $8 billion to $11 billion in additional subprime-related write-downs. And then there was Goldman Sachs, which reported a $2.9 billion profit that quarter. For the moment, the financial press seemed in awe of Blankfein, Cohn, and the rest of the team running the firm. Fortune headlined an article “How Goldman Sachs Defies Gravity” that said Goldman’s “huge, shrewd bet” against the mortgage market “would seem to confirm the view Goldman is the nimblest, and perhaps the smartest, brokerage on Wall Street.” A Goldman press release drily noted that “significant losses” in some areas — the subprime mortgages it hadn’t managed to unload — had been “more than offset by gains on short mortgage products.” A Goldman trader who played a central role in the big short was not so demure when making the case for a big bonus that year. John Paulson was “definitely the man in this space,” he conceded, but he’d helped make Goldman “#1 on the street by a wide margin.” Disaster struck nine months into 2008 with the collapse of Lehman Brothers, in large part the result of its exposure to subprime losses. Hank Paulson, the Treasury secretary and former Goldman CEO, spent a weekend meeting with would-be suitors willing to take over a storied bank that on paper was now worth virtually nothing. He couldn’t find a buyer. Nor could officials from the Federal Reserve, who were also working overtime to save the investment bank, founded in 1850, that was even older than Goldman Sachs. Shortly after midnight on Monday, September 15, 2008, Lehman announced that it would file for bankruptcy protection when the courts in New York opened that morning — the largest bankruptcy in U.S. history. Goldman Sachs wasn’t immune from the crisis. The week before Lehman’s fall, Goldman’s stock had topped $161 a share. By Wednesday, it dropped to below $100. It had avoided some big losses by betting against the mortgage market, but the wider financial crisis was wreaking havoc on its other investments. On paper, Cohn had personally lost tens of millions of dollars. He hunkered down in an office with a view of Goldman’s trading floor and worked the phone, trying to change the minds of major investors who were pulling their money from Goldman, fearful of anything riskier than stashing their cash in a mattress. The next week, Goldman converted from a free-standing investment bank to a bank holding company, which made it, in the eyes of regulators, no different from Wells Fargo, JPMorgan Chase, or any other retail bank. That gave the firm access to cheap capital through the Fed but would also bring increased scrutiny from regulators. The bank took a $10 billion bailout from the Troubled Asset Relief Program and another $5 billion from Warren Buffett, in return for an annual dividend of 10 percent and access to discounted company stock. The firm raised additional billions through a public stock offering. The biggest threat to Goldman was the economic health of the American International Group. Among other products, AIG sold insurance to protect against defaults on mortgage assets, which had been central to Goldman’s big short. Of the $80 billion in U.S. mortgage assets that AIG insured during the housing bubble, Goldman bought protection from AIG on roughly $33 billion, according to the Wall Street Journal. When Lehman went into bankruptcy, its creditors received 11 cents on the dollar. Executives at AIG, in a frantic effort to avoid bankruptcy, had floated the idea of pushing its creditors to accept 40 to 60 cents on the dollar; there was speculation creditors like Goldman would receive as little as 25 percent. Goldman and its clients were looking at multibillion-dollar hits to their bottom line — a potentially fatal blow. But as Goldman learned a century ago, it pays to have friends in high places. The day after Lehman went bankrupt, the Bush administration announced an $85 billion bailout of AIG in return for a majority stake in the company. The next day, Paulson obtained a waiver regarding interactions with his former firm because, the Treasury secretary said, “It became clear that we had some very significant issues with Goldman Sachs.” Paulson’s calendar, the New York Times reported, showed that the week of the AIG bailout, he and Blankfein spoke two dozen times. While creditors around the globe were being forced to settle for much less than they were owed, AIG paid its counterparties 100 cents on the dollar. AIG ended up being the single largest private recipient of TARP funding. It received additional billions in rescue funds from the New York Federal Reserve Bank, whose board chair Stephen Friedman was a former Goldman executive who still sat on the firm’s board. The U.S. Treasury ended up with greater than a 90 percent share of AIG, and the U.S. government, using taxpayer dollars, paid in full on the insurance policies financial institutions bought to protect themselves from steep declines in real estate prices — chief among them, Goldman Sachs. All told, Goldman received at least $22.9 billion in public bailouts, including $10 billion in TARP funds and $12.9 billion in taxpayer-funded payments from AIG. Goldman, once again, had come out on top. Goldman Sachs Group Inc. headquarters stands in New York City, on Oct. 12, 2016. Photo: Mark Kauzlarich/Bloomberg/Getty Images 4. THE VAMPIRE SQUID Goldman Sachs repaid repaid its $10 billion bailout partway through 2009, less than 12 months after the loan was made. Other banks in the U.S. and abroad were still struggling but not Goldman, which reported a record $19.8 billion in pre-tax profits that year, and $12.9 billion the next. Gary Cohn went without a bonus in 2008, left to scrape by on his $600,000 salary. Once free of government interference, the Goldman board (which included Cohn himself) paid him a $9 million bonus in 2009 and an $18 million bonus in 2010. Yet the once venerated firm was now the subject of jokes on the late-night talk shows. David Letterman broadcast a “Goldman Sachs Top 10 Excuses” list (No. 9: “You’re saying ‘fraud’ like it’s a bad thing.”). Rolling Stone’s Matt Taibbi described the bank as “a great vampire squid wrapped around the face of humanity, relentlessly jamming its blood funnel into anything that smells like money,” a devastating moniker that followed Goldman into the business pages. After news leaked that the firm might pay its people a record $16.7 billion in bonuses in 2009, even President Barack Obama, for whom the firm had been a top campaign donor, began to turn against Goldman, telling “60 Minutes,” “I did not run for office to be helping out a bunch of fat-cat bankers on Wall Street.” “They’re still puzzled why is it that people are mad at the banks,” Obama said. “Well, let’s see. You guys are drawing down $10, $20 million bonuses after America went through the worst economic year that it’s gone through in decades, and you guys caused the problem.” Goldman was also facing an onslaught of investigations and lawsuits over behavior that had helped precipitate the financial crisis. Class actions and other lawsuits filed by pension funds and other investors accused Goldman of abusing their trust, making “false and misleading statements,” and failing to conduct basic due diligence on the loans underlying the products it peddled. At least 25 of these suits named Cohn as a defendant. State and federal regulators joined the fray. The SEC accused Goldman of deception in its marketing of opaque investments called “synthetic collateralized debt obligations,” the values of which were tied to bundles of actual mortgages. These were the deals Goldman had arranged in 2006 on behalf of John Paulson so he could short the U.S. housing market. Goldman, it turned out, had allowed Paulson to cherry-pick poor-quality loans at the greatest risk of defaulting — a fact Goldman did not share with potential investors. “Goldman wrongly permitted a client that was betting against the mortgage market to heavily influence which mortgage securities to include in an investment portfolio,” the SEC’s enforcement director at the time said, “telling other investors that the securities were selected by an independent, objective third party.” Suddenly, Cohn and other Goldman officials were downplaying the big short. In June 2010, Cohn testified before the Financial Crisis Inquiry Commission, created by Congress to investigate the causes of the nation’s worst economic collapse since the Great Depression. Cohn asked the commissioners how anyone could claim the firm had bet against its clients when “during the two years of the financial crisis, Goldman Sachs lost $1.2 billion in its residential mortgage-related business”? His statement was technically true, but Cohn failed to mention the billions of dollars the firm pocketed by betting the mortgage market would collapse. Senate investigators later calculated that, at its peak, Goldman had $13.9 billion in short positions that would only pay off in the event of a steep drop in the mortgage market, positions that produced a record $3.7 billion in profits. Two weeks after Cohn’s testimony, Goldman agreed to pay the SEC $550 million to settle charges of securities fraud — then the largest penalty assessed against a financial services firm in the agency’s history. Goldman admitted no wrongdoing, acknowledging only that its marketing materials “contained incomplete information.” Goldman paid $60 million in fines and restitution to settle an investigation by the Massachusetts attorney general into the financial backing the firm had offered to predatory mortgage lenders. The bank set aside another $330 million to assist people who lost their homes thanks to questionable foreclosure practices at a Goldman loan-servicing subsidiary. Goldman agreed to billions of dollars in additional settlements with state and federal agencies relating to its sale of dicey mortgage-backed securities. The firm finally acknowledged that it had failed to conduct basic due diligence on the loans its was selling customers and, once it became aware of the hazards, did not disclose them. In the final report produced by the Senate’s Permanent Subcommittee on Investigations, Goldman Sachs was mentioned an extraordinary 2,495 times, and Gary Cohn 89 times. A Goldman Sachs representative declined to respond to queries on the record. President Barack Obama with Sen. Christopher Dodd, D-Conn., (C) and Rep. Barney Frank, D-Mass., (C-R) after signing the Dodd-Frank Act in Washington, July 21, 2010. Photo: Doug Mills/The New York Times/Redux The investigations and fines were a blow to Goldman’s reputation and its bottom line, but the regulatory reforms being debated had the potential to threaten Goldman’s entire business model. Even before the 2008 crash, the firm’s lobbying spending had grown under Lloyd Blankfein and Cohn. By 2010, the year financial reforms were being drafted, Goldman spent $4.6 million for the services of 49 lobbyists. Their ranks included some of the most well-connected figures in Washington, including Democrat Richard Gephardt, a former House majority leader, and Republican Trent Lott, a former Senate majority leader, who had stepped down from the Senate two years earlier. Despite all those lobbyists on the payroll, Goldman made its case primarily through proxies during the debate over financial reform. “The name Goldman Sachs was so radioactive it worked to their disadvantage to be tied to an issue,” said Marcus Stanley, then a staffer for Democratic Sen. Barbara Boxer and now policy director of Americans for Financial Reform. Instead, Goldman lobbied through industry groups. Goldman’s people likely knew that all of Wall Street’s lobbying might could not stop the passage of the sprawling 2010 legislative package dubbed the Dodd-Frank Wall Street Reform and Consumer Protection Act. Obama was putting his muscle behind reform — “We simply cannot accept a system in which hedge funds or private equity firms inside banks can place huge, risky bets that are subsidized by taxpayers,” he said in one speech — and the Democrats enjoyed majorities in both houses of Congress. “For Goldman Sachs, the battle was over the final language,” said Dennis Kelleher of Better Markets, a Washington, D.C., lobby group that pushes for tighter financial reforms. “That way they at least had a fighting chance in the next round, when everyone turned their attention to the regulators.” There was a lot for Goldman Sachs to dislike about Dodd-Frank. There were small annoyances, such as “say on pay,” which ordered companies to give shareholders input on executive compensation, a source of potential embarrassment to a company that gave out $73 million in compensation for a single year’s work — as Goldman paid Cohn in 2007. There were large annoyances, such as the requirement that financial institutions deemed too big to fail, like Goldman, create a wind-down plan in case of disaster. There were the measures that would interfere with Goldman’s core businesses, such as a provision instructing the Commodity Futures Trading Commission to regulate the trading of derivatives. And yet nothing mattered to Goldman quite like the Volcker Rule, which would protect banks’ solvency by limiting their freedom to make speculative trades with their own money. Unless Goldman could initiate what Stanley called the “complexity two-step” — win a carve-out so a new rule wouldn’t interfere with legitimate business and then use that carve-out to render a rule toothless — Volcker would slam the door shut on the entire direction in which Blankfein and Cohn had taken Goldman. It was 5:30 a.m. on Friday, June 25, 2010, when a joint House-Senate conference committee approved the final language of Dodd-Frank. By Sunday, an industry attorney named Annette Nazareth — a former top SEC official whose firm counts Goldman Sachs among its clients — had already sent off a heavily annotated copy of the 848-page bill to colleagues at her old agency. It was just the first salvo in a lobbying juggernaut. Within a few months, Cohn himself was in Washington to meet with a governor of the Federal Reserve, one of the key agencies charged with implementing Volcker. The visitors log at the CFTC, the agency Dodd-Frank put in charge of derivatives reform, shows that Cohn traveled to D.C. to personally meet with CFTC staffers at least six times between 2010 and 2016. Cohn also came to the capital for meetings at the SEC, another agency responsible for the Volcker Rule. There, he met with SEC chair Mary Jo White and other commissioners. “I seem to be in Washington every week trying to explain to them the unintended consequences of overregulation,” Cohn said in a talk he gave to business students at Sacred Heart University in 2015. “Gary was the tip of the spear for Goldman to beat back regulatory reform,” said Kelleher, the financial reform lobbyist. “I used to pass him going into different agencies. They brought him in when they wanted the big gun to finish off, to kill the wounded.” Democrats lost their majority in the House that November, and Goldman threw its weight behind the spate of Republican bills that followed, aimed at taking apart Dodd-Frank piece by piece. Goldman spent more than $4 million for the services of 45 lobbyists in 2011 and $3.5 million a year in 2012 and 2013. Its lobbying spending was nearly as high in the years after passage of Dodd-Frank as it was the year the bill was introduced. Goldman lobbyists dug in on a range of issues that would become top priorities for Republicans in the wake of Donald Trump’s electoral victory. Records from the Center for Responsive Politics show that Goldman lobbyists worked to promote corporate tax cuts, such as on the Tax Increase Prevention Act of 2014 and Senate legislation aimed at extending some $200 billion in tax cuts for individuals and businesses. Goldman lobbied for a bill to fund economically critical infrastructure projects, presumably on behalf of its Public Sector and Infrastructure group. Goldman had seven lobbyists working on the JOBS Act, which would make it easier for companies to go public, another bottom-line issue to a company that underwrote $27 billion in IPOs last year. In 2016, Goldman had eight lobbyists dedicated to the Financial CHOICE Act, which would have undone most of Dodd-Frank in one fell swoop — a bill the House revived in April. Yet defanging the Volcker Rule remained the firm’s top priority. Promoted by former Fed Chair Paul Volcker, the rule would prohibit banks from committing more than 3 percent of their core assets to in-house private equity and hedge funds in the business of buying up properties and businesses with the goal of selling them at a profit. One harbinger of the financial crisis had been the collapse in the summer of 2007 of a pair of Bear Stearns hedge funds that had invested heavily in subprime loans. That 3 percent cap would have had a big impact on Goldman, which maintained a separate private equity group and operated its own internal hedge funds. But it was the restrictions Volcker placed on proprietary trading that most threatened Goldman. Prop trading was a profit center inside many large banks, but nowhere was it as critical as at Goldman. A 2011 report by one Wall Street analyst revealed that prop trading accounted for an 8 percent share of JPMorgan Chase’s annual revenues, 9 percent of Bank of America’s, and 27 percent of Morgan Stanley’s. But prop trading made up 48 percent of Goldman’s. By one estimate, the Volcker Rule could cost Goldman Sachs $3.7 billion in revenue a year. When regulators finalized a new Volcker Rule in 2013, Better Markets declared it a “major defeat for Wall Street.” Yet the victory for reformers was precarious. “Just changing a few words could dramatically change the scope of the rule — to the tune of billions of dollars for some firms,” said former Senate staffer Tyler Gellasch, who helped write the rule. Volcker gave banks until July 2015 — the five-year anniversary of Dodd-Frank — to bring themselves into compliance. Yet apparently the Volcker Rule had been written for other financial institutions, not elite firms like Goldman Sachs. “Goldman Sachs has been on a shopping spree with its own money,” began a New York Times article in January 2015. The bank used its own funds to buy a mall in Utah, apartments in Spain, and a European ink company. Paul Volcker expressed disappointment that banks were still making big proprietary bets, as did the two senators most responsible for writing the rule into law. That June, Cohn appeared to reassure investors that Goldman would find a workaround. Speaking at an investor conference, he said Goldman was “transforming our equity investing activities to continue to meet client needs while complying with Volcker.” Goldman had five years to prepare for some version of a Volcker Rule. Yet a loophole granted banks sufficient time to dispose of “illiquid assets” without causing undue harm — a loophole that might even cover the assets Goldman had only recently purchased, despite the impending compliance deadline. The Fed nonetheless granted the firm additional time to sell illiquid investments worth billions of dollars. “Goldman is brilliant at exercising access and influence without fingerprints,” Kelleher said. By mid-2016, Goldman, along with Morgan Stanley and JPMorgan Chase, was petitioning the Fed for an additional five years to comply with Volcker — which would take the banks well into a new administration. All Blankfein and Cohn had to do was wait for a new Congress and a new president who might back their efforts to flush all of Dodd-Frank. Then Goldman could continue the risky and lucrative habits it had adopted since traders like Cohn had taken over the firm — the financial crisis be damned — and continue raking in billions in profits each year. Lloyd Blankfein, chair and CEO of Goldman Sachs, (L) stands on stage with former U.S. Secretary of State Hillary Clinton during the 2014 Clinton Global Initiative annual meeting in New York on Sept. 24, 2014. Photo: Stephen Chernin/AFP/Getty Images Goldman’s political giving changed in the wake of Dodd-Frank. Dating back to at least 1990, according to the Center for Responsive Politics, people associated with the firm and its political action committees contributed more to Democrats than Republicans. Yet in the years since financial reform, Goldman, once Obama’s second-largest political donor, shifted its campaign contributions to Republicans. During the 2008 election cycle, for instance, Goldman’s people and PACs contributed $4.8 million to Democrats and $1.7 million to Republicans. By the 2012 cycle, the opposite happened, with Goldman giving $5.6 million to Republicans and $1.8 million to Democrats. Cohn’s personal giving followed the same path. Cohn gave $26,700 to the Democratic Senatorial Campaign Committee in 2006 and $55,500 during the 2008 election cycle, and none to its GOP equivalent. But Cohn donated $30,800 to the National Republican Senatorial Committee in 2012 and another $33,400 to the National Republican Congressional Committee in 2015, without contributing a dime to the DSCC. Cohn gave $5,000 to Massachusetts Republican Scott Brown weeks after news broke that Elizabeth Warren — an outspoken critic of Goldman and other Wall Street players — might try to capture his U.S. Senate seat, which she did in 2012. Goldman Sachs, under Cohn and Blankfein, was hardly chastened, continuing to play fast and loose with existing rules even as it plunged millions of dollars into fending off new ones. In 2010, the SEC ran a sting operation looking for banks willing to trade favorable assessments by its stock analysts for a piece of a Toys R Us IPO if the company went public. Goldman took the bait, for which they would pay a $5 million fine. An employee working out of Goldman’s Boston office drafted speeches, vetted a running mate, and negotiated campaign contracts for the state treasurer during his run for Massachusetts governor in 2010, despite a rule forbidding municipal bond dealers from making significant political contributions to officials who can award them business. According to the SEC, Goldman had underwritten $9 billion in bonds for Massachusetts in the previous two years, generating $7.5 million in fees. Goldman paid $12 million to settle the matter in 2012. Just two years later, Goldman officials were again summoned by the Senate Permanent Subcommittee on Investigations to address charges that the bank under Cohn and Blankfein had boosted its profits by building a “virtual monopoly” in order to inflate aluminum prices by as much as $3 billion. The last few years have brought more unwanted attention. In 2015, the U.S. Justice Department launched an investigation into Goldman’s role in the alleged theft of billions of dollars from a development fund the firm had helped create for the government of Malaysia. Federal regulators in New York state fined Goldman $50 million because its leaders failed to effectively supervise a banker who leaked stolen confidential government information from the Fed, which hit the firm with another $36.3 million in penalties. In December, the CFTC fined Goldman $120 million for trying to rig interest rates to profit the firm. Politically, 2016 would prove a strange year for Goldman. Bernie Sanders clobbered Hillary Clinton for pocketing hundreds of thousands of dollars in speaking fees from Goldman, while Trump attacked Ted Cruz for being “in bed with” Goldman Sachs. (Cruz’s wife Heidi was a managing director in Goldman’s Houston office until she took leave to work on her husband’s presidential campaign.) Goldman would have “total control” over Clinton, Trump said at a February 2016 rally, a point his campaign reinforced in a two-minute ad that ran the weekend before Election Day. An image of Blankfein flashed across the screen as Trump warned about the global forces that “robbed our working class.” Goldman’s giving in the presidential race appears to reflect polls predicting a Clinton win and the firm’s desire for a political restart on deregulation. People who identified themselves as Goldman Sachs employees gave less than $5,000 to the Trump campaign compared to the $341,000 that the firm’s people and PACs contributed to Clinton. Goldman Sachs is relatively small compared to retail banking giants. Yet, according to the Center for Responsive Politics, no bank outspent Goldman Sachs during the 2016 political cycle. Its PACs and people associated with the firm made $5.6 million in political contributions in 2015 and 2016. Even including all donations to Clinton, 62 percent of Goldman’s giving ended up in the coffers of Republican candidates, parties, or conservative outside groups. President Donald Trump speaks to community bankers as Director of the National Economic Council Gary Cohn (2nd R) and White House Chief of Staff Reince Priebus (R) listen during an event at the Kennedy Garden of the White House on May 1, 2017 in Washington, D.C. Photo: Alex Wong/Getty Images 5. TROJAN HORSE There’s ultimately no great mystery why Donald Trump selected Gary Cohn for a top post in his administration, despite his angry rhetoric about Goldman Sachs. There’s the high regard the president holds for anyone who is rich — and the instant legitimacy Cohn conferred upon the administration within business circles. Cohn’s appointment reassured bond markets about the unpredictable new president and lent his administration credibility it lacked among Fortune 100 CEOs, none of whom had donated to his campaign. Ego may also have played a role. Goldman Sachs would never do business with Trump, the developer who resorted to foreign banks and second-tier lenders to bankroll his projects. Now Goldman’s president would be among those serving in his royal court. Who can say precisely why Cohn, a Democrat, said yes when Trump asked him to be his top economic aide? No doubt Cohn has been asking himself that question in recent weeks. But he’d hit a ceiling at Goldman Sachs. In September 2015, Goldman announced that Blankfein had lymphoma, ramping up speculation that Cohn would take over the firm. Yet four months later, after undergoing chemotherapy, Blankfein was back in his office and plainly not going anywhere. Cohn was 56 years old when he was invited to Trump Tower. An influential job inside the White House meant a face-saving exit — and one offering a huge financial advantage. Trump spoke of the great financial price Cohn paid to join him in the White House during his speech in Cedar Rapids. But something like the opposite was true. A huge amount of Cohn’s wealth was tied up in Goldman stock. By entering government, he could sell his stake in the firm to comply with federal ethics laws. That way he could diversify his holdings and avoid roughly $50 million in capital gains taxes —  at least until he sold the replacement assets. A job in the White House might also prove an outlet for his frustrations with politicians and regulators intent on reining in the worst impulses of Wall Street. Trump was Trump, but he had also vowed to dismantle financial reform. “Dodd-Frank has made it impossible for bankers to function,” Trump said during the campaign. The new president had the potential to serve as a vessel for Goldman’s corporate interests. “Maybe the one thing that holds this administration together is a belief that markets know best, and the least regulation is the best regulation,” said Dennis Kelleher of Better Markets. “Goldman’s interests fit with that very nicely.” U.S. Treasury Secretary Steven Mnuchin testifies before the House Appropriations Committee’s Financial Services and General Government Subcommittee in the Rayburn House Office Building on Capitol Hill on June 12, 2017 in Washington, D.C. Photo: Chip Somodevilla/Getty Images Trump had given Steve Mnuchin, his campaign finance chair, the grander title. But taking over as Treasury secretary meant being confirmed by the Senate. Mnuchin’s confirmation vote was delayed after it was revealed that he’d neglected to list $95 million in assets (including homes in New York, Los Angeles, and the Hamptons) on his Senate Finance Committee disclosure forms and failed to disclose his ties to an offshore hedge fund registered in the Cayman Islands. Mnuchin was not confirmed until mid-February. The president’s pick for commerce secretary, Wilbur Ross, a financier who had bailed out several of Trump’s casinos a few decades earlier, was not confirmed until the end of February. As a presidential aide, Cohn did not need Senate approval. He was part of the skeletal crew that arrived at the White House on day one, giving him a critical head start on wielding his clout and cultivating his relationship with the new president. At that point, Trump was summoning Cohn to the Oval Office for impromptu meetings as many as five times a day. In early February, Trump signed an executive order giving his Treasury secretary 120 days to give him a hit list of regulations the administration could eliminate. But with Mnuchin yet to be confirmed, the task appeared to land in Cohn’s eager hands. He was standing at the president’s shoulder when Trump said, “We expect to be cutting a lot out of Dodd-Frank.” Shares in Goldman Sachs, which had jumped by 28 percent after the election, rose another $6 a share that day. Soon Cohn was coordinating Trump’s plans not only for rolling back regulations, but also for creating jobs and slashing taxes. He met with a health care specialist, along with House Speaker Paul Ryan and other Republican leaders, to discuss alternatives to the Affordable Care Act. Proximity is power inside any White House, especially in this one, where policy often seems shaped by Trump’s last conversation. Treasury is several blocks away, while Cohn’s office was in the West Wing, directly across the hall from Bannon’s. Operating within a chaotic administration, Cohn was reportedly energized and focused, working around the clock. Cohn is a tenacious practitioner who, after ascending to the heights of Goldman Sachs, could teach a master class on the art of seizing a leadership vacuum and building alliances. On day 39 of the new administration, the White House sent out a press release introducing the “best-in-class team” Cohn had assembled “to drive President Trump’s bold plan for job creation and economic growth.” The 13 advisers included familiar figures who had worked for George W. Bush or his father, but they also included at least three former lobbyists so conflicted they would need an ethics waiver to work in the White House. For instance, Michael Catanzaro, the man Cohn chose to oversee energy policy, was until last year a lobbyist for such oil, gas, and coal companies as Devon Energy and Talen Energy. Shahira Knight had been a lobbyist for Fidelity, the mutual fund giant, before joining Cohn’s team. Cohn’s strategy in those early months was to make himself indispensable to the new president. Cohn emerged as one of the few people around Trump comfortable interrupting him during a meeting or openly disagreeing on points of policy. The New York Times reported that Trump often turned to Cohn during a meeting and asked him directly, “What do you want to do?” Early on, Trump referred to Cohn as “one of my geniuses” — a quote Reuters attributed to a “source close to Cohn.” Soon, major media were painting Cohn as a leading centrist inside the Trump White House because he had staked out positions on immigration, international alliances, and global warming at odds with Bannon’s hard-right nationalism. Bannon and his allies only bolstered this narrative by characterizing “Carbon Tax Cohn” and his allies, Jared Kushner and Ivanka Trump, as interlopers — “the Democrats,” as some inside the White House called them. “Within Trump’s Inner Circle, a Moderate Voice Captures the President’s Ear,” read the headline of a Cohn profile in the Washington Post. “Led by Gary Cohn and Dina Powell — two former Goldman Sachs executives often aligned with Trump’s elder daughter and his son-in-law — the group and its broad network of allies are the targets of suspicion, loathing and jealousy from their more ideological West Wing colleagues,” the Washington Post reported. Fueling the rage of the ideologues, Cohn and his allies were largely winning. Trump dropped Bannon from the National Security Council and elevated Powell to deputy national security adviser. When, after Charlottesville, false reports leaked that Cohn was so disgusted with the president he was resigning, blue-chip stocks slid down. Instead, Bannon was out. Cohn, despite reports that he invoked Trump’s wrath for critical remarks to the Financial Times, was still in and expected to deliver the president a win on corporate taxes. National Economic Council Director Gary Cohn arrives at a Wall Street heliport while traveling with President Donald Trump on May 4, 2017 in New York City. Photo: Brendan Smialowski/AFP/Getty Images On the day it was announced that he was joining the Trump administration, Cohn said on a goodbye podcast for Goldman Sachs, “You look at the size of our capital. You look at the size of our balance sheet. You look at the size of our people — it’s just enormous.” More than $40 billion had flowed into the bank in 2016, bringing the bank’s assets under management to a record $1.38 trillion. That meant pressure to find ways to put that money to work — an enormous challenge if regulators finally shut down Goldman’s prop trading arm. How exactly could Cohn recuse himself from matters involving Goldman when almost every aspect of his job has the potential to either grow Goldman’s profits and inflate its stock price — or tank them both? “To the extent Goldman Sachs is a direct party in a matter, Gary will recuse himself,” a source familiar with the situation said. But, the source added, “As NEC director, Gary is going to touch on matters on the day-to-day economy as a whole and Goldman Sachs is a participant in the economy, thus Gary will indirectly touch on things that affect Goldman Sachs along with other banks and institutions.” Yet rather than publicly recuse himself on attempts to undo Dodd-Frank, Cohn has led the charge from inside the White House. On that matter, Cohn is a walking, talking conflict of interest. While at Goldman, Cohn had personally met with officials at the Commodity Futures Trading Commission to discuss the derivatives reform plank of Dodd-Frank, an arena in which Goldman is a dominant player. He had taken issue with rules imposed by Dodd-Frank that require banks to keep more capital on hand. Requiring banks to hold more money in reserve made them “unequivocally” safer than before 2008, he said in a 2015 interview while still Goldman’s president, but he complained that Goldman was now able to lend less money, hurting profits. And then there’s the Volcker Rule. Cohn, while still president of the firm, had traveled to D.C. at least twice to personally lobby regulators about its implementation. These days, it can be hard to tell whether Cohn is speaking as a high-ranking White House official or a former Goldman Sachs executive. In the wake of Trump’s February call for a rollback in financial regulations, Cohn vowed in an interview with Bloomberg TV, “We’re going to attack all aspects of Dodd-Frank.” The first example he gave: the Volcker Rule, which he cast as harmful to the country’s competitive advantage. In an interview that same day with Fox Business, he homed in on another Goldman obsession: Dodd-Frank’s capital requirements. “Banks are forced to hoard money because they are forced to hoard capital, and they can’t take any risks,” he said. Mortgage, auto, credit card lending, and commercial lending are all up since 2010. Yet Cohn told Fox viewers, “We need to get banks back in the lending business, that’s our No. 1 objective.” Roy Smith, a former Goldman partner now teaching at the NYU Stern School of Business, argues that Cohn should avoid the administration’s effort to unwind Dodd-Frank altogether, but “at a very minimum he has to excuse himself whenever the discussion turns to Volcker.” But Smith said he has trouble imagining Cohn leaving the room when Volcker comes up. “The hard part for someone like Cohn is that he knows where all the pain points are with Volcker and other parts of Dodd-Frank,” Smith said. “His every instinct would be to get involved.” Beyond deregulation, two other pillars of Trump’s economic plan — cutting taxes and investing in infrastructure — would have dramatic impacts on Goldman’s bottom line. Thanks to loopholes, many Fortune 500 corporations pay little or no corporate income tax at all. By contrast, Goldman Sachs typically pays taxes near the official 35 percent federal tax rate. In 2014, for instance, Goldman paid $3.9 billion in taxes on profits of $12.4 billion, or 31 percent. Last year, the firm’s tax bill was $2.7 billion on profits of $10.3 billion, or 28 percent. In that same Fox Business interview, Cohn said that “lower corporate taxes” was the White House’s “starting point” on tax reform; cuts to personal income taxes were a secondary concern. Under the plan Cohn and Mnuchin announced last spring, what Cohn called “one of the biggest tax cuts in the American history,” corporate taxes would be capped at 15 percent. If Cohn succeeds, Goldman will save massive sums: At that rate, Goldman would have paid $2 billion less in taxes in 2014, $1.4 billion less in 2015, and $1.4 billion less in 2016. The Koch brothers’ network of political groups has already spent millions of dollars to promote the proposal. Even Blankfein, who the Trump campaign singled out in the commercial it ran in the final days of the campaign, acknowledged in a voicemail to employees that Trump’s commitment to tax cuts, deregulation, and infrastructure “will be good for our clients and our firm.” The details of the president’s “$1 trillion” infrastructure plan are similarly favorable to Goldman. As laid out in the administration’s 2018 budget, the government would spend only $200 billion on infrastructure over the coming decade. By structuring “that funding to incentivize additional non-Federal funding” — tax breaks and deals that privatize roads, bridges, and airports — the government could take credit for “at least $1 trillion in total infrastructure spending,” the budget reads. It was as if Cohn were still channeling his role as a leader of Goldman Sachs when, at the White House in May, he offered this advice to executives: “We say, ‘Hey, take a project you have right now, sell it off, privatize it, we know it will get maintained, and we’ll reward you for privatizing it.’” “The bigger the thing you privatize, the more money we’ll give you,” continued Cohn. By “we,” he clearly meant the federal government; by “you,” he appeared to be speaking, at least in part, about Goldman Sachs, whose Public Sector and Infrastructure group arranges the financing on large-scale public sector deals. “Goldman Sachs is one of the largest infrastructure fund managers globally,” according to infrastructure advisory firm InfraPPP Partners, “having raised more than $10 billion of capital since the inception of the business in 2006.” Lost in the infamous press conference the president gave in the lobby of Trump Tower a few days after Charlottesville, with Cohn and Mnuchin visibly uncomfortable at his right flank, were Trump’s remarks on infrastructure, the ostensible purpose of the event. The thrust was that the president would grease the wheels for project approvals by signing an executive order rolling back environmental impact requirements and other elements of an “overregulated permitting process.” In countless other ways, Cohn is positioned to help the firm that has been so good to him over the years. The country’s National Economic Council adviser might caution a president against running too large a deficit, especially amid a healthy economy. But Goldman Sachs is in the business of finding investors to underwrite government debt. An economic adviser might caution a populist president that corporate inversions often cost jobs and tax revenue. Instead, Trump has ordered a review of policies Obama put in place to discourage them — good news for Cohn’s former colleagues. Transparency has been a watchword of initial public offerings dating back at least to the Securities and Exchange Act of 1934, but easing those rules, a step Goldman has sought, could potentially generate hundreds of millions of dollars in fees for investment banks such as Goldman. The SEC announced in June that it would allow any company going public to withhold details of its finances and strategies, an exemption previously available only to firms with under $1 billion in revenue — more good tidings for Goldman. Just loosening the rules for IPOs, said Tyler Gellasch, the former Senate staffer, “could mean hundreds of millions of dollars more to Goldman.” In June, the Treasury Department released a statement of principles about the administration’s approach to financial regulation focused on promoting “liquid and vibrant markets.” Not surprisingly, the report included a call to ease capital requirements and substantially amend the Volcker Rule. It’s Cohn’s influence over the country’s regulators that worries Dennis Kelleher, the financial reform lobbyist. “To him, what’s good for Wall Street is good for the economy,” Kelleher said of Cohn. “Maybe that makes sense when a guy has spent 26 years at Goldman, a company who has repaid his loyalties and sweat with a net worth in the hundreds of millions.” Kelleher recalls those who lost a home or a chunk of their retirement savings during a financial crisis that Cohn helped precipitate. “They’re still suffering,” he said. “Yet now Cohn’s in charge of the economy and talking about eliminating financial reform and basically putting the country back to where it was in 2005, as if 2008 didn’t happen. I’ve started the countdown clock to the next financial crash, which will make the last one look mild.”

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12 сентября, 18:00

Goldman Unveils Its Employees Much Younger, Far Less Paid As FICC Revenues Plunge

As part of its presentation to the Barclays Financial Services conference this morning, Goldman revealed that it saw revenue growth opportunities of more than $5b over 3 years. As the slide below shows, this includes: $1BN+ in FICC, $2BN+ in lending/financing (with the bank's "Marcus" loan, deposit platform netting $1BN+), $500MM+ in investment banking, $1BN+ in investment management and $500m+ in equties clients. The bank also disclosed that its Marcus loan, deposit platform, which is one of the higher paying savings programs available with a rate of 1.20%, recently crossed $1BN in loan originations, and expects to originate $2b by 2017 year-end. Even more interesting was Goldman's observation of the collapse of traditionally most profitable for banks FICC sector, which according to Goldman has seen the addressable industry size/revenue plunge from $121 billion in 2009, when Goldman owned a 19% share of industry revenues, to just $66 billion, of which Goldman now holds a paltry 10%. Of the current $66 billion in total addressable FICC revenue, Goldman holds roughly 10%, broken down between $6.7 billion in market making/liquidity provisioning (rather an oximoron in our days), and $0.9 billion in financing. Also of note: Goldman's response to the shrinkage of its this profitable segment: a 30% drop in FICC comp and benefits, a 20% decline in FICC headcount in the past 5 years, coupled with a 50% plunge in RWAs and a 15% decline in allocated balance sheet space. But what may be the most interesting slide in the entire presentation, is the following slide which confirms that in a world in which even the world's most powerful investment bank is now emphasizing traditional and boring NIM-based loan growth over debt-trading revenues, it has no choice but to trim its headcount. Substantially. And, as the following slide shows, not only has Goldman been forced to get "younger", with a 13% increase in Associates and Analysts offsetting a 13% decline in Partners and MDs, but also the average comp ratio has plunged from 42.1% in the 2007-2011 era, to only 37.4% in the 2012-2016 period, with Goldman highlighting that in H1 2017 its public comp accrual was the lowest in the company post-IPO history. In short, and rather amazingly, even Goldman is running out of ideas how to grow its legacy business and is now forced to morph into a plain old, boring bank which takes in deposits and gives out loans. No wonder Lloyd Blankfein appears less than enthused about running the universe these days... Full Goldman slideshow link

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11 сентября, 19:02

Good thing guys like Lloyd Blankfein are scared: Trader

The “Fast Money Halftime Report” traders discuss how stocks are in rally mode.

08 сентября, 17:51

The world’s most powerful bank issues a major warning

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Via SovereignMan.com In 1869, a 48-year old Jewish immigrant from the tiny village of Trappstadt in Germany’s Bavaria region hung a shingle outside of his small office in lower Manhattan to officially launch his new business. His name was Marcus Goldman, and the business he started, what’s now known as Goldman Sachs, has become the preeminent investment bank in the world with nearly $1 trillion in assets. They didn’t get there by winning any popularity contests. Goldman Sachs has been at the heart of nearly every major banking scandal in recent history. The company has settled lawsuits on countless charges, ranging from exchange rate manipulation, stock price manipulation, demanding bribes from their own clients, front-running retail customers, and just about every shady business practice that would put money in their pockets. Yet throughout it all, Goldman Sachs has been protected from any serious punishment by its friends in highest offices of government. Four out of the last eight US Treasury Secretaries, including the current one, have formerly been on the payroll of Goldman Sachs. Three current Federal Reserve Bank presidents are Goldman Sachs alumni. The current president of the European Central Bank and the current head of the Bank of England are both former Goldman Sachs employees. You get the idea. On its face, there’s nothing wrong with government staffing its departments with top executives from the private sector; taxpayers would probably rather have someone who knows what s/he’s doing behind the desk rather than some random guy off the street. But the consequent favoritism that results from this revolving door is blatant and repulsive. Case in point: in 2008 when the financial system was going up in flames and most banks were suffering enormous losses, the government orchestrated a sweetheart bailout deal, of which Goldman was the primary beneficiary. Goldman stood to lose billions of dollars from its bad investments in insurance giant AIG (which was going bankrupt). Instead, Goldman was repaid 100 cents on the dollar, courtesy of the US taxpayer. And that’s not an isolated case. The point is that Goldman Sachs is deeply embedded across the entire economy, nearly every major western government, and the most important financial markets in the world. So when the bank’s CEO says that financial markets are too expensive, it’s probably time to start paying attention. That’s exactly what happened yesterday at the Handelsblatt business conference in Frankfurt, Germany– Goldman Sachs’ CEO told the audience bluntly that world financial markets “have been going up for too long.” And it’s true. Many major stock markets around the world are near all-time highs. Bond markets are near all-time highs. Property markets are near all-time highs. Insolvent governments that have a history of defaulting on their debts (like Argentina) are able to issue bonds with maturity dates of ONE HUNDRED YEARS at laughably small interest rates. Companies which perpetually lose money are seeing their stock prices soar to continual new heights. Interest rates in many parts of the world are still negative. And whereas the average length of a ‘bull market,’ in which asset prices rise, is just over 5 years, the current bull market has been going for 8 ½ years. That makes it one of the longest in the history of financial markets. There are now legions of seasoned analysts, traders, and investment bankers working on Wall Street who have literally never experienced a down year. Little by little, a few prominent voices in finance have started to express concerns about the state of financial markets. Yesterday’s comments by Goldman’s CEO was only the latest. Though given his status as THE market and economic insider, his remarks are perhaps the most noteworthy. In fairness, no one has a crystal ball, especially when it comes to financial markets. Not even the CEO of Goldman Sachs. But if these guys are telling the world that the market is overheated, you can probably imagine they’ve already started selling.

07 сентября, 23:25

World's Most Powerful Bank Issues As Major Warning

Authored by Simon Black via SovereignMan.com, In 1869, a 48-year old Jewish immigrant from the tiny village of Trappstadt in Germany’s Bavaria region hung a shingle outside of his small office in lower Manhattan to officially launch his new business. His name was Marcus Goldman, and the business he started, what’s now known as Goldman Sachs, has become the preeminent investment bank in the world with nearly $1 trillion in assets. They didn’t get there by winning any popularity contests. Goldman Sachs has been at the heart of nearly every major banking scandal in recent history. The company has settled lawsuits on countless charges, ranging from exchange rate manipulation, stock price manipulation, demanding bribes from their own clients, front-running retail customers, and just about every shady business practice that would put money in their pockets. Yet throughout it all, Goldman Sachs has been protected from any serious punishment by its friends in highest offices of government. Four out of the last eight US Treasury Secretaries, including the current one, have formerly been on the payroll of Goldman Sachs. Three current Federal Reserve Bank presidents are Goldman Sachs alumni. The current president of the European Central Bank and the current head of the Bank of England are both former Goldman Sachs employees. You get the idea. On its face, there’s nothing wrong with government staffing its departments with top executives from the private sector; taxpayers would probably rather have someone who knows what s/he’s doing behind the desk rather than some random guy off the street. But the consequent favoritism that results from this revolving door is blatant and repulsive. Case in point: in 2008 when the financial system was going up in flames and most banks were suffering enormous losses, the government orchestrated a sweetheart bailout deal, of which Goldman was the primary beneficiary. Goldman stood to lose billions of dollars from its bad investments in insurance giant AIG (which was going bankrupt). Instead, Goldman was repaid 100 cents on the dollar, courtesy of the US taxpayer. And that’s not an isolated case. The point is that Goldman Sachs is deeply embedded across the entire economy, nearly every major western government, and the most important financial markets in the world. So when the bank’s CEO says that financial markets are too expensive, it’s probably time to start paying attention. That’s exactly what happened yesterday at the Handelsblatt business conference in Frankfurt, Germany– Goldman Sachs’ CEO told the audience bluntly that world financial markets “have been going up for too long.” And it’s true. Many major stock markets around the world are near all-time highs. Bond markets are near all-time highs. Property markets are near all-time highs. Insolvent governments that have a history of defaulting on their debts (like Argentina) are able to issue bonds with maturity dates of ONE HUNDRED YEARS at laughably small interest rates. Companies which perpetually lose money are seeing their stock prices soar to continual new heights. Interest rates in many parts of the world are still negative. And whereas the average length of a ‘bull market,’ in which asset prices rise, is just over 5 years, the current bull market has been going for 8 ½ years. That makes it one of the longest in the history of financial markets. There are now legions of seasoned analysts, traders, and investment bankers working on Wall Street who have literally never experienced a down year. Little by little, a few prominent voices in finance have started to express concerns about the state of financial markets. Yesterday’s comments by Goldman’s CEO was only the latest. Though given his status as THE market and economic insider, his remarks are perhaps the most noteworthy. In fairness, no one has a crystal ball, especially when it comes to financial markets. Not even the CEO of Goldman Sachs. But if these guys are telling the world that the market is overheated, you can probably imagine they’ve already started selling. Do you have a Plan B?

07 сентября, 16:11

The Bubble Is Now So Massive Even Wall Street is Getting Nervous

The market bubble has become so massive that even Wall Street is nervous. To be clear, investment banks do best when stocks are in a bull market. And they love bubbles because it means more M&A, IPOs, dead offerings, stock issuance and other deals from which they derive their revenues. So for Wall Street CEOs to openly start warning that the market is in a bubble… they have to be really REALLY nervous about what they’re seeing... and know that a stock market crash is coming On that note this week, not one but TWO major bank CEOs warned about the markets. First was Deutsche Bank CEO John Cryan with the following nugget: “We are now seeing signs of bubbles in more and more parts of the capital market where we wouldn’t have expected them," Cryan said, adding that the interest-rate policy has been partly responsible for the decline in earnings at European banks. “I welcome the recent announcement by the Federal Reserve and now also from the ECB that they intend to gradually bring their loose monetary policy to an end.” Source: Bloomberg. This, in of itself, is extraordinary. But then we have Lloyd Blankfein, CEO of Goldman Sachs stating the following during the same week: “When yields on corporate bonds are lower than dividends on stocks, that unnerves me," the Goldman Sachs chief executive said during an interview Wednesday that was broadcast at a European banking conference in Germany and on the internet. Source: CNBC So we have not one, but TWO Wall Street CEOs warning that the market is in a bubble. And we all know how those end: in a stock market crash./ This is truly staggering. And it indicates that those at the top of the financial system are actively preparing for what's coming. A Crash is coming… And smart investors will use it to make literal fortunes. We offer a FREE investment report outlining when the market will collapse as well as what investments will pay out massive returns to investors when this happens. It's called Stock Market Crash Survival Guide. We've reopened this report to the public for 24 hours based on the warnings from Wall Street CEOs. But today is the last day this report will be available. To pick up one of the last remaining copies… CLICK HERE! Best Regards Graham Summers Chief Market Strategist Phoenix Capital Research

07 сентября, 14:44

‘Things Have Been Going Up For Too Long’ – Goldman CEO

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“Things have been going up for too long...” - Goldman Sachs’ CEO - Lloyd Blankfein, Goldman CEO "unnerved by market" (see video)- Bitcoin bubble is no outlier says Bank of America Merrill Lynch- Bubbles are everywhere including London property- $14 trillion of monetary stimulus has pushed investors to take more risks- We are now in a new era of bigger booms and bigger busts - BAML- “Seeing signs of bubbles in more and more parts of the capital market" - Deutsche Banks' John Cryan- Global debt bubble and China very vulnerable too - warns Steve Keen- Bubbles, bubbles everywhere ... lots of potential pins ... got gold? Editor: Mark O'Byrne Video - Goldman CEO Unnerved By Market. Image: Getty Images via CNBC The B word is something which is almost whispered in financial circles. To acknowledge there might be a bubble somewhere is like admitting the proverbial elephant is in the room. But, like many taboo words, it seems the mainstream are coming around to the idea that it is ok to mention the word ‘bubble’ and express their concerns about the possibility of at least one existing. This week Goldman Sachs’ Lloyd Blankfein, Deutsche Banks’ CEO John Cryan and strategists at Bank of America Merrill Lynch have separately expressed concerns that there are signs of bubbles in the markets - from the obvious bitcoin bubble to the less obvious bubble in London and other property markets and bubbles in many stock and bond markets. The most obvious one is bitcoin. Bitcoin is up 380% this year whilst the combined market cap of cryptocurrencies is up by 800%. However these are by no means anomalies according to analysts at BAML. Cryan and Blankfein agree, thanks to central bank money printing and low interest rates, they too are expressing their concerns over the state of markets. "When yields on corporate bonds are lower than dividends on stocks? That unnerves me ... "Lloyd Blankfein There's no bubble here Professor Robert Shiller has been calling a bubble in bitcoin for a couple of years, for him it is the latest sign of 'Irrational Exuberance'.  “The best example right now [of irrational exuberance] is Bitcoin. And I think that has to do with the motivating quality of the Bitcoin story. And I’ve seen it in my students at Yale. You start talking about Bitcoin and they’re excited! And I think, what’s so exciting? You have to think like humanities people. What is this Bitcoin story?” The bitcoin community was not best pleased when the man who is credited with being able to spot speculative manias decided to single out the cryptocurrency as the latest one. In response CoinTelegraph wrote an article entitled 'Bitcoin So High Above the Bubbles They Can't Be Seen'. The author claims that bitcoin is failing to follow the pattern of other bubbles. In fact, a closer inspection of the growth, and the eventual burst of the associated bubbles shows that Bitcoin is so far off the charts that it looks like an absolute outlier. The bitcoin crowd are doing exactly what so many tend to do when a market is massively outperforming - they build a narrative from it and begin to fuel the belief that the price can only go up. A BBC Capital article on the bitcoin phenomenon quotes a small bitcoin investor as saying '“I don’t know how far it’s going to grow,” he explains, “but if something is growing at hundreds of per cent, that’s a pretty valuable return.” Note 'I don't know how far it's going to grow...' The investor is convinced this can only go one way. For now we can perhaps assure ourselves that unlike in some other markets few investors will have gone all in or driven themselves into debt (as per the housing market). A happy, bubbly narrative Bubbles are created when investor enthusiasm and optimism are at excessive levels. In a 2010 interview with the Financial Crisis Inquiry Commission (FCIC) Warren Buffett explained that this happens because investors originally invest based on a sound premise, which is then the only focus for the investment strategy and they end up blinkered. Simply put investors begin to invest based on a sound premise, for example house prices are going to go up because money is losing its value and there is a more demand than supply. Investors are convinced that as house prices are climbing they must buy now. This goes on and on based on the original premise. Investors ignore other developments such as house price climbs are now outstripping inflation. We are seeing a similar thing in bitcoin. The housing example is no more pertinent right now than in Australia which is basically a $1.7 trillion house of cards. According to LF Economics, Australian housing speculators are able to use unrealized gains in properties as a 'cash substitute' for down payments on other investment properties. 'Profitability is therefore predicated on ever-rising house prices...“[Many] international wholesale lenders ... may find out the hard way that they have invested into nothing more than a $1.7 trillion ‘piss in a fancy bottle scam’,” Homebuyers forget the original premise and and become blinkered by the price action - which is that house prices are going up and up. Because it has been relatively easy and cheap to borrow money to finance purchases on these properties homebuyers suddenly see themselves as investors and decide to buy more than one house, because ‘it’s only going to go up’. This is where we are with so many asset classes right now, including bitcoin, property, vintage cars and equities. Debt and bubble junkies But what gets the narrative going in the first place? In the last ten years it has been the generosity of central banks in their infinite money printing and low interest rate policies. “Post the financial crisis, the largesse of central banks appears to be inducing quicker and steeper price gains in assets compared to the case historically,” analysts at BAML wrote “Speculative behavior in assets is cropping up more frequently and in more places than just credit markets.” Earlier in the summer Citi's Hans Lorenzen said the effect of the central banks' 'largesse' was that "the wealth effect is stretching farther and farther afield." BAML's analysts are also seeing this spread of the bubble effect across a number of markets, not just in credit markets where there is an unprecedented buying spree. 'Asset bubbles seem to be becoming more “bubbly” as time goes by...' Unlike our bitcoin friends, BAML sees a key issue with the current trajectory of the crypto's price: For instance, the increase in Japanese equities was pronounced between mid-1982 and the end of 1989, with share prices rising around 440% over the period. But Bitcoin, for instance, has risen roughly 2000% since just mid-2015. And other, recent, in-vogue indices seem to be surging higher as well. Not to mention the Nasdaq index has soared over 18 % this year while the S&P 500 and Dow Jones indexes are each around 10% higher - building on the already large gains seen in recent years. Throughout the year U.S. bond yields at the 10-year and 30-year maturities have also fallen. As Deutsche Bank's John Cryan pointed out much of this inflation in the market place is thanks to the prolonger period of low-interest rates and cheap monetary policy. He called for the ECB to put an end to their current monetary policy and it is now causing “ever greater upheaval.” “We are now seeing signs of bubbles in more and more parts of the capital market where we wouldn’t have expected them...I welcome the recent announcement by the Federal Reserve and now also from the ECB that they intend to gradually bring their loose monetary policy to an end.” Is no one else worried about this? Cryan pointed out that today volatility is markedly cheap given what is going on in both financial markets and the wider geopolitical space. "The interesting thing about the markets today is that obviously they pay some regard to these hotspots but they don't seem to be paying too much regard because we see very high asset prices in almost all asset categories..." In Professor Steve Keen’s book Can We Avoid Another Financial Crisis?, he argues that many countries have become debt junkies. “They face the junkie’s dilemma, a choice between going ‘cold turkey’ now, or continuing to shoot up on credit and experience a bigger bust later.” Is it all about to go ‘pop’? BAML strategist Barnaby Martin thinks not. Currently the market has a benign view on rates and this will most likely only be altered by an ‘inflationary shock’ which will see the major flows into the credit cycle fall back. Or the ECB swiftly stops with its current QE programme. The latter may come sooner than we think, today the ECB is expected to give some indication on its plans regarding bond purchases, but in reality it probably won’t make much difference. As Martin writes, this party isn’t coming to an end just yet: "the end of the credit party will likely require a big inflationary “shock” in Europe, and one strong enough to reset market expectations over the pace of rate hikes. Safe to say that this seems a long way off to us." As a result, helped by falling political uncertainty (note European policy uncertainty is now lower than US policy uncertainty – the first time since mid-2012) and the renewed rise in negative yielding assets (note record number of European countries now with negative yielding debt), we see credit spreads heading tighter into year-end. China swoops in from the left-field How might all this end? Who knows. The last time interest-rates were this low for as long was during the 1930s and that ended with the Second World War. It might be through trying to avoid World War III that the financial collapse is finally triggered. Currently Trump is relying heavily on China to cool things down with Kim Jong-Un of maniacal despot fame. In Keen’s latest book China is one of the countries he believes is a debt junkie. The country’s credit-driven expansion has accounted for more than half of global growth since 2008. Why? Because it dealt with the collapse of the Western credit bubble in 2008 by fuelling a bubble of its own. Today Chinese banks have $35tn of assets on their balance sheets – a fourfold increase since 2008. In the last decade private debt as a proportion of the country’s annual economic output (GDP) has increased from 120% to 210%. Its financial system could almost be a mirror to those seen in the US and UK in the run up to the financial crisis. It has a large shadow banking system and special investment vehicles that take assets off balance sheets. How does this relate to Trump, North Korea and the next financial crisis? Trump needs China on side when dealing with Kim Jong-Un. However, last week Beijing said that in the event of war between the two nuclear powers it would sit on the sidelines. Trump now has to decide how to handle China as the country clearly has its limits in how much it will help. The most obvious option would be to impose economic sanctions for example, slapping tariffs on steel imports. It could also put China in a negative light in terms of its dealings in markets such as going back to Trump’s old rhetoric branding the country as a currency manipulator or accusing it of facilitating illegal piracy businesses. Should sanctions be imposed then a trade war would inevitably erupt. This eruption would firmly put a pin in China’s bubble and ripples would be sent out across the world. Bubbles, bubbles everywhere ... lots of potential pins ... got gold?   News and Commentary Gold holds steady amid softer dollar (Reuters.com) Stocks Rise, Treasuries Fall on Debt-Ceiling Deal (Bloomberg.com) Trump cuts deal with Democrats in Congress to avert immediate budget and debt crisis (LATimes.com) Fed’s Beige Book finds worry about health of U.S. auto industry (MarketWatch.com) Fischer to Step Down in Mid-October as Fed Vacancies Mount (Bloomberg.com) Source: Bloomberg “Sum of All Fears” Restores Investors’ Faith in Gold (Bloomberg.com) How Investors Are Preparing for the Worst on North Korea (Bloomberg.com) We’re Going into Another Long-Term Gold, Silver Bull Market - Neumeyer (SmallCapPower.com) Gold Break Above $1,375/oz Should See Rise To "Initial Target of $1,705/oz" - BMO (GoldSeek.com) ‘Things Have Been Going Up for Too Long’ - Goldman CEO (CNBC.com) Gold Prices (LBMA AM) 07 Sep: USD 1,340.45, GBP 1,026.52 & EUR 1,119.54 per ounce06 Sep: USD 1,340.15, GBP 1,028.03 & EUR 1,122.11 per ounce05 Sep: USD 1,331.15, GBP 1,029.51 & EUR 1,120.43 per ounce04 Sep: USD 1,334.60, GBP 1,030.98 & EUR 1,120.53 per ounce01 Sep: USD 1,318.40, GBP 1,020.18 & EUR 1,107.98 per ounce31 Aug: USD 1,305.80, GBP 1,013.17 & EUR 1,098.31 per ounce30 Aug: USD 1,310.60, GBP 1,014.93 & EUR 1,096.71 per ounce Silver Prices (LBMA) 07 Sep: USD 17.79, GBP 13.59 & EUR 14.85 per ounce06 Sep: USD 17.77, GBP 13.62 & EUR 14.90 per ounce05 Sep: USD 17.88, GBP 13.80 & EUR 15.03 per ounce04 Sep: USD 17.80, GBP 13.75 & EUR 14.95 per ounce01 Sep: USD 17.50, GBP 13.53 & EUR 14.69 per ounce31 Aug: USD 17.34, GBP 13.47 & EUR 14.62 per ounce30 Aug: USD 17.44, GBP 13.49 & EUR 14.60 per ounce Recent Market Updates - Physical Gold In Vault Is “True Hedge of Last Resort” – Goldman Sachs- Bitcoin Falls 20% as Mobius and Chinese Regulators Warn- Gold Surges To $1338 as U.S. Warns of ‘Massive’ Military Response- Precious Metals Outperform Markets In August – Gold +4%, Silver +5%- 4 Reasons Why “Gold Has Entered A New Bull Market” – Schroders- Gold Reset To $10,000/oz Coming “By January 1, 2018” – Rickards- Gold Surges 2.6% After Jackson Hole and N. Korean Missile- Diversify Into Gold On U.S. “Political Instability” Advise Blackrock- Trump Presidency Is Over – Bannon Is Right- The Truth About Bundesbank Repatriation of Gold From U.S.- Cyberwar Risk – Was U.S. Navy Victim Of Hacking?- Global Financial Crisis 10 Years On: Gold Rises 100% from $650 to $1,300- Mnuchin: I Assume Fort Knox Gold Is Still There Important Guides For your perusal, below are our most popular guides in 2017: Essential Guide To Storing Gold In Switzerland Essential Guide To Storing Gold In Singapore Essential Guide to Tax Free Gold Sovereigns (UK) Please share our research with family, friends and colleagues who you think would benefit from being informed by it.

07 сентября, 01:40

Even Lloyd Blankfein Is Getting Worried: "Things Have Been Going Up For Too Long"

Earlier today, we reported that Deutsche Bank CEO John Cryan called for an end to Europe’s cheap-money policies and asked that the European Central Bank not use the strengthening euro as an excuse to keep printing money. According to Bloomberg, Cryan said that the bank is “seeing signs of bubbles” across capital markets while low interest pummel European banks’ earnings. “We are now seeing signs of bubbles in more and more parts of the capital market where we wouldn’t have expected them," Cryan said, adding that the interest-rate policy has been partly responsible for the decline in earnings at European banks.   “I welcome the recent announcement by the Federal Reserve and now also from the ECB that they intend to gradually bring their loose monetary policy to an end.” Now, barely a day later, Goldman Sachs CEO Lloyd Blankfein has joined his fellow bulge bracket bank chief in expressing his uneasiness with contemporary valuations and the central-bank money printing that has helped pump up asset prices around the world. Blankfein said that “things have been going up for too long” and that “when yields on corporate bonds are lower than dividends on stocks, that unnerves me.” Here’s more from the Wall Street Journal: “Goldman Sachs Group Chairman Lloyd Blankfein on Wednesday sounded a warning about the markets, saying that some of what he sees “unnerves” him.   Mr. Blankfein said the current market environment “doesn’t feel like tulip-bulb-mania,” a reference to the famous speculative bubble in the Netherlands in 1637, but was nonetheless concerning.   ‘Things have been going up for too long,’ he told attendees at a Handelsblatt business conference in Frankfurt.   ‘When yields on corporate bonds are lower than dividends on stocks? That unnerves me.’” Here’s a breakdown of Blankfein’s other remarks, courtesy of WSJ. The CEO was speaking via a video link from Goldman’s headquarters in New York: …On speculation that Goldman alum Gary Cohn could become the next chairman of the Federal Reserve, Blankfein said Cohn would do a “different job but a great job.” “I think Gary is very very capable. He would be a different kind of person. Not an academic. I don’t know that he reads a lot of policy papers, let alone writes then, but there’s nobody who understands markets better?.”   Relative to current chair Janet Yellen, Mr. Cohn is ‘much less theoretical.’”   ‘Who’s to say what’s better or not??’ he said, noting that past Fed chairs have had more of a markets bent. ‘I’d be willing to give that a try. I think he would do a different job, but a great job.’” …On Trump: “Things could have gone better but I’m not without hope. A lot of what [President Trump's] trying to accomplish I’m friendly to. There are a lot of layers of protectionism and regulation that have been built up that impede progress. I think his good intentions are to take a lot of that away.? ?I have some disappointment but also some hope.?”? …Asked about the bank’s “Government Sachs” moniker, Blankfein said the bank happens to have a lot of employees who are “civically minded.” “We have a lot of people who are civically minded…I’m proud of it. Their qualities are recognized. ?T?hey make a sacrifice and we feel the cost of that sacrifice, because they’re very capable people.” …On the Volcker rule: “'You have people sitting on desks who are paralyzed out of fear… It has had chilling effect in people’s willingness' to make markets." ...On declining revenue at the bank’s trading division: “’We have always had periods of time where we haven’t done well. I’m not terribly aggrieved by it. It’s a level playing field for everyone. I think we can do well in this environment, and we can do well if they relax the rules.’   ‘We’re running in a horse race against our competitors. If it rains, it rains for everyone and we’ll run in the mud. If it’s sunny, we’ll all run in the sunshine.’” Could Blankfein’s and Cryan’s remarks portend a selloff in the coming months? Certainly, their publicly voiced concerns about asset bubbles probably represent the most bearish comments made by the leaders of systemically important banks since July, when J.P. Morgan Chase & Co. CEO Jamie Dimon warned investors that the Federal Reserve’s unwinding of its balance sheet wouldn’t be like watching paint dry, but instead that it could be “a little more disruptive than people think.”

06 сентября, 23:57

Stocks Tumble After WSJ Reports Gary Cohn "Unlikely" To Be Next Fed Chair

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US Equity futures just opened and tumbled in what seems like a delayed reaction to the Cohn news...   Nasdaq, Dow, and S&P Futs all opened lower...   *  *  * As we detailed earlier, just hours after Fed Vice Chair Fischer resigned, and Goldman CEO Lloyd Blankfein threw his support behind Gary Cohn... “No one’s perfect, but he’s the best I know,” Blankfein said of Cohn, his former No. 2 at Goldman Sachs, during a talk with journalists on Wednesday at the bank’s headquarters in New York.   “He’d be a different kind of person” than Fed Chair Yellen, Blankfein added.   “He’s not an academic. I don’t know that he reads a lot of policy papers, let alone write them.”  'Sources' confirm President Trump is unlikely to nominate Gary Cohn to become Federal Reserve Chairman, WSJ’s Nate Becker reports in tweet. A @WSJ scoop crossing now: Trump unlikely to nominate Cohn as Fed chair; his chances dropped after he criticized Trump on Charlottesville. — Nate Becker (@natebecker) September 6, 2017 As The Wall Street Journal reports, this shift inside the Oval Office was largely due to Mr. Cohn’s reaction to Mr. Trump’s response to the violence in Charlottesville, Va., in which the president at times blamed both white supremacists opposing the removal of a Confederate war statue and counterprotesters. According to PredictIt, Cohn's odds just crashed...   Interestingly there is some reaction in stocks, as some wonder what Cohn is sticking around for now... (especially after being called out as a "globalist" by Trump)

21 августа, 22:54

Blankfein Trolls Trump, Compares Him To A Solar Eclipse

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Back on June 1, in his first ever tweet (after being a silent member of Twitter since 2011), Goldman CEO Lloyd Blankfein slammed Trump's decision to pull the United States out of the Paris climate change agreement, which he called “a setback for the environment and for the U.S.'s leadership position in the world.” Today's decision is a setback for the environment and for the U.S.'s leadership position in the world. #ParisAgreement — Lloyd Blankfein (@lloydblankfein) June 1, 2017 Fast forward to today when the Goldman CEO, in his capacity as the former boss of Trump's chief economy advisor (and most likely future head of the Federal Reserve, Gary Cohn), took another veiled swipe at the Trump administration when in what appeared to be a subtweet targetting Donald Trump, said "Wish the moon wasn't the only thing casting a shadow across the country. We got through one, we'll get through the other. #SolarEclipse2017" Wish the moon wasn't the only thing casting a shadow across the country. We got through one, we'll get through the other. #SolarEclipse2017 — Lloyd Blankfein (@lloydblankfein) August 21, 2017 One assumes that Blankfein was addressing Trump (indirectly) as the only person left making any economic decisions, now that Steve Bannon is gone, is his former right hand man, Gary Cohn. Which begs the question: is Blankfein's latest critique just more carefully staged theater, meant to elevate the CEO of the "vampire squid" in the eyes of the general public and shape him into a kind, caring, nurturing idealist ready to carry the ideals of progressives everywhere, or was the tweet an indication that despite the dominance of the now undisputed dominance of the "Goldman circle" inside the White House, Bannon still remains a key decision-maker, even if banished from the Oval Office. Whatever the right answer, it should provide a welcome distraction as former Goldman COO Gary Cohn does everything in his power to sneak through a new tax code that benefits the likes of, well, Goldman Sachs.

19 августа, 03:45

The Real Story Behind Goldman's Q2 Trading Loss: How A $100M Gas Bet Went Awry

Goldman Sachs FICC-trading income was an unexpectedly ugly blemish on what was already a poor Q2 earnings report. And while the FDIC-backed hedge fund initially blamed the decline on lower trading revenues, lack of volatility and depressed client activity... ... there was more to the story. The Wall Street Journal has uncovered what really happened: A $100 million bet on regional natural-gas prices gone awry after production problems at a local pipeline sent prices soaring, decimating Goldman’s position. “Goldman wagered that gas prices in the Marcellus Shale in Ohio and Pennsylvania would rise with the construction of new pipelines to carry gas out of the region, said people familiar with the matter. Instead, prices there fell sharply in May and June as a key pipeline ran into problems.” More specifically… “Goldman’s key miscalculation last quarter was betting that natural-gas prices in the Marcellus Shale would rise relative to the national benchmark price in Louisiana known as the Henry Hub, the people familiar with the matter said.” The quarter was the worst ever for the bank’s commodities unit, which, as WSJ notes, has been one of the firm’s most consistent profit centers, and a training ground for many of its top executives, including Chief Executive Lloyd Blankfein. The trading loss “extended a broader slump at a company once known as Wall Street’s savviest gambler.” Goldman shares fell 2.6% on the day of the report, which analysts largely attributed to the miss in trading revenues, despite a stronger-than-expected bottom-line profit. The investment bank has held on to its commodities-trading business even as most other American banks exited following the financial crisis. It is currently the seventh-largest market maker for natural gas in North America, larger than some energy giants like Exxon Mobil. According to WSJ, trading oil, metals and other physical commodities is increasingly dominated by smaller firms like Glencore PLC and Gunvor Group Ltd. that don’t face as much government regulation. “The loss highlights the trade-offs Goldman made in sticking with the risky commodities-trading business, even as other large banks retreated following the financial crisis. Goldman is the seventh-biggest marketer of natural gas in North America, up from 13th in 2011, according to Natural Gas Intelligence—bigger than U.S. energy giants such as Exxon Mobil Corp. and Chesapeake Energy Corp. It has been the only U.S. bank in the top 20 since 2013, when J.P. Morgan Chase & Co. left the business.” WSJ explains that Goldman’s position would've produced a profit if a pipeline being built to carry natural gas out of the Midwest had been completed on time. Instead, it faced multiple delays after a series of fluid spills and the accidental bulldozing of a historic Ohio home. “Essentially, it was a bet on the timely completion of pipelines under construction to ferry a glut of gas out of the region.   But one of those pipelines ran into trouble this spring: the 713-mile Rover, which would transport gas from the Marcellus to the Midwest and beyond.   Its developer, Energy Transfer Partners, in February bulldozed a historic Ohio home without notifying regulators, and scrambled to finish clearing trees before the roosting season for a protected bat species. In May, federal regulators barred Energy Transfer from drilling on some segments of the route after a series of fluid spills.   The first leg of the pipeline, which had been set to come online in July, isn’t expected until at least September. Energy Transfer said it has “been working efficiently and nonstop to remediate” problems and expects to have the entire pipeline operational in January.” In all likelihood, part of Goldman’s position was accumulated to offset the risk-management needs of the bank’s clients, WSJ reported. Goldman’s counterparties, the drillers operating in the Marcellus shale, reported strong gains in their derivatives books. “Goldman was in part likely catering to gas producers in the region that wanted to lock in steadier revenue through swaps and other contracts. Many Marcellus drillers reported big gains in the value of their derivatives portfolios in the second quarter—meaning their trading partners lost money in that period, at least on paper.” Of course, the bank’s executives would have you believe the loss was solely the result of Goldman fulfilling its duty to help its clients manage risk, and that the bank’s trades didn’t violate the Volcker Rule (a ban on proprietary trading that was part of Dodd-Frank). As WSJ notes, whether or not a trade violates the Volcker rule depends on who initiated it, how long the bank held the position, and myriad other factors. But with President Trump in the White House and with future Fed Chairman Gary Cohn's only nemesis getting the boot earlier today, soon Goldman will be empowered to take much more trading risks with the explicit blessings of 1600 Pennsylvania.

01 августа, 16:14

"You Know What You Did": Scaramucci Punked By Email Spoofer Pretending To Be Priebus

The first two times infamous email spoofer @SINON_REBORN struck, the UK was scandalized when first Barclays CEO Jes Staley, then the head of the BOE, Mark Carney himself, were duped into lengthy email conversations with the "prankster" as the FT reported at the time. Staley, thinking he was being emailed by Barclays chair John McFarlane, offered his effusive praise to his respondent, saying among other things that he had "all the fearlessness of Clapton." Carney, in turn, responded to emails from the imposter pretending to be Anthony Habgood, the chairman of the court of the BoE. Then, in June, the spoofer extended his winning streak by also punking Goldman's Lloyd Blankfein and Citi's Michael Corbat into believing he was someone else. Now, the same prankster, a 38-year-old web designer from Manchester according to the FT, has struck again, this time fooling several highly placed White House officials on several occasions, most remarkably Anthony Scaramucci, into thinking he was someone else. As CNN reports, the exchange between the prankster and the Mooch may have played a role in the tensions between the now former White House Communications Director and the since-fired White House Chief of Staff, Reince Priebus, who replacement Gen. Kelly fired Scaramucci. Pretending to be Priebus, the prankster emailed Scaramucci's official account using a mail.com account on Saturday, the day after Priebus' resignation was announced. "I had promised myself I would leave my hands mud free, but after reading your tweet today which stated how; 'soon we will learn who in the media who has class, and who hasn't', has pushed me to this. That tweet was breathtakingly hypocritical, even for you. At no stage have you acted in a way that's even remotely classy, yet you believe that's the standard by which everyone should behave towards you? General Kelly will do a fine job. I'll even admit he will do a better job than me. But the way in which that transition has come about has been diabolical. And hurtful. I don't expect a reply." To which Scaramucci responded: "You know what you did. We all do. Even today. But rest assured we were prepared. A Man would apologize." The UK spoofer wrote back, again pretending to be Prievus: "I can't believe you are questioning my ethics! The so called 'Mooch', who can't even manage his first week in the White House without leaving upset in his wake. I have nothing to apologize for." Scaramucci response, date July 30: "Read Shakespeare. Particularly Othello. You are right there. My family is fine by the way and will thrive. I know what you did. No more replies from me."   Not content with spoofing Scaramucci once, the prankster did it again in another exchange in which the former SkyBridge executive was again fooled by the prankster, this time pretending to be Russia Ambassador Jon Huntsman Jr. "Who's (sic) head should roll first?" the bogus Huntsman asked from a Gmail account on Friday, before the Priebus termination had been announced. "Maybe I can help things along somewhat." "Both of them," responded the real Scaramucci, in what CNN believes was an apparent reference to both Priebus and White House Senior Adviser Steve Bannon, about whom Scaramucci has been quite critical. After a few other nice messages of support from faux Huntsman, Scaramucci wrote, "Are you in Moscow now? If not please visit." * * * Finally, for good measure, the prankster also pretended to be Scaramucci's friend, Arthur Schwartz, on Monday evening after news of his departure had already hit, emailing the Mooch: "Everyone's pushing for why's and who's" to which the response was "Yup call in a bit." I even emailed Scaramucci yesterday evening ????. That's THREE people I've made him believe I am. 'Communications Director'... yeah right! pic.twitter.com/TVOsUCosXX — EMAIL PRANKSTER (@SINON_REBORN) August 1, 2017 Jon Huntsman was also tricked, with the prankster pretending to be Eric Trump: "Thanks for the thoughtful note," the ambassador-designate wrote to fake Eric Trump. "Russia will be a challenging but no doubt rewarding assignment." The fake Eric Trump responded with this suggestion: "Maybe we could have Dad sat (sic) on a horse, top off, giving the full Putin! He's in better shape than his suits suggest." In a follow up, the White House acknowledged the incidents to CNN and said they were taking the matter seriously. "We take all cyber related issues very seriously and are looking into these incidents further," White House press secretary Sarah Huckabee Sanders said. In addition to demonstrating politician gullibility, what these spoofing incidents demonstrate is just how easy it is to engage into a confidence and trust-building conversation with some of the most important politicians and bankers, and that contrary to conventional wisdom, anyone can do it, not just the KGB.

25 июня, 18:10

TRUMP declines to blame Obama on FOX -- BILL COHAN on how GARY COHN ‘fell for’ Trump -- KOCH network plans to spend 300-400M in ‘18 -- SPOTTED at MNUCHIN’s wedding -- FIELDS/WEINSTEIN nuptials pool report

Good Sunday morning. THE PRESIDENT left the White House at 9:16 a.m. “in golf clothes (white shirt, white cap, dark slacks),” per pooler Alexis Simendinger. “Agents are dressed in their khakis and plaid, baggy, short-sleeved shirts--attire accessorized with ball caps. One was just practicing a pantomimed golf swing in the driveway.” … Trump pulled into Trump National Golf Club in Virginia at 9:51 a.m.STATEMENT FROM PRESIDENT DONALD TRUMP (@realDonaldTrump) at 8 a.m.: “Hillary Clinton colluded with the Democratic Party in order to beat Crazy Bernie Sanders. Is she allowed to so collude? Unfair to Bernie!”-- NOTE: Hillary Clinton became the Democratic Party’s nominee 334 days ago. Trump beat her 229 days ago.MICHAEL KRUSE in POLITICO Magazine, “I Found Trump’s Diary -- Hiding in Plain Sight: Legally risky, undiplomatic and sometimes wrong, Trump’s Twitter feed is a document for the ages. And historians don’t want to lose it”: “In the presumed absence, then, of a more traditional version of the form, Trump’s collected tweets comprise the closest thing to a diary this presidency will produce.“And that is what makes the messages from @realDonaldTrump, almost 800 and counting since January 20, 2017, such a prize to those who care the most about lasting insight into the president and this administration. If @realDonaldTrump was to go dark, and Trump stopped tweeting to his more than 32 million followers, humans and bots alike, the loss from a historical standpoint would be acute.” http://politi.co/2t9dyzXTRUMP ON “FOX AND FRIENDS” SUNDAY MORNING -- PETE HEGSETH: “Who’s been your biggest opponent? Has it been Democrats resisting? Has it been fake news media? Has it been deep state leaks? What’s -- when you think about it, what holds it up the most? --” … TRUMP: … “One of the things that should be solved, but it probably won’t be, is that the Republicans and Democrats don’t get together. And I’m open arms; but, I don’t see that happening. They fight each other. The level of hostility. In other words, this isn’t just Trump, this has been like this for years. You’ve been doing this for a long time, it’s been like that for a long time. But the level of hostility – as an example, the healthcare bill that you are reporting on and that everybody’s reporting on.”-- TRUMP WAS TEED UP, BUT DECLINES TO BLAME OBAMA: HEGSETH: “How frustrating is it to have former President Obama there, out there leading the resistance?” TRUMP: “Well I think -- I don’t think he’s leading it. He actually just put out a small statement. I don’t see that leading it. But other people are leading.”-- TRUMP HITS WARREN … AGAIN: HEGSETH: “How do you overcome that when someone like Senator Warren – Elizabeth Warren literally says ‘People are going to die because of President Trump’s health-care bill’?” TRUMP: “Well I actually think she’s a hopeless case. I call her Pocahontas, and that’s an insult to Pocahontas. I actually think that she is just somebody that’s got a lot of hatred, a lot of anger.”WHAT TO WATCH FOR THIS WEEK -- “Will Anthony Kennedy step down from the Supreme Court?” by AP’s Mark Sherman: “The Supreme Court enters its final week of work before a long summer hiatus with action expected on the Trump administration’s travel ban and a decision due in a separation of church and state case that arises from a Missouri church playground. The biggest news of all, though, would be if Justice Anthony Kennedy were to use the court’s last public session on Monday to announce his retirement.“To be sure, Kennedy has given no public sign that he will retire this year and give President Donald Trump his second high court pick in the first months of his administration. Kennedy’s departure would allow conservatives to take firm control of the court. But Kennedy turns 81 next month and has been on the court for nearly 30 years. Several of his former law clerks have said they think he is contemplating stepping down in the next year or so. Kennedy and his clerks were gathering over the weekend for a reunion that was pushed up a year and helped spark talk he might be leaving the court.” http://bit.ly/2t5rBWQ-- KELLYANNE CONWAY on ABC’S “THIS WEEK”: CONWAY: “I will never reveal a conversation between a sitting justice and the president or the White House, but we’re paying very close attention to these last bit of decisions. And I can tell you one thing, just as the president did with Justice Neil Gorsuch, whenever there are vacancies, whenever that happens, he will look for somebody who has fidelity to the constitution, who doesn’t make up the law as they go along, and somebody who has the judicial temperament and a record that's beyond reproach, as did Justice Gorsuch.“We just hope the next time we can get more than a handful of Democratic senators to vote for our nominee to the Supreme Court and to the federal courts. We’d like a lot more cooperation from our Democratic friends. We know obstruction and resistance is their motto. It's not working. And it’s not working for the American people, Supreme Court nominations and otherwise.”THE BIG PICTURE -- “The weakest defense in Washington? Saying ‘I don’t recall’,” by Darren Samuelsohn: “Some of President Donald Trump’s closest confidants seem to be suffering from an affliction common in high-stakes White House investigations: memory loss. In his recent testimony before the Senate Intelligence Committee concerning his role in the unfolding Russia saga, Attorney General Jeff Sessions answered questions with some variation of ‘I do not recall’ more than 20 times. Amnesia is often a favorite response from witnesses in criminal and congressional investigations, and it’s often the most truthful reply—but people caught up in scandals can wind up facing perjury or other charges if prosecutors can later show they were intentionally trying to dodge tough questions.” http://politi.co/2t5ihSQHOW TIMES CHANGE -- “Freedom Caucus holds fire on Senate Obamacare repeal bill,” by Kyle Cheney and Rachael Bade: “The most hardline conservatives in the House are taking an unusually cautious approach to the Senate's Obamacare replacement, promising to keep an open mind about whatever their colleagues across the Capitol send back. It’s a change in strategy for the House Freedom Caucus. When House leaders first released a health care bill in February, for instance, group members took to television talk shows to pan the plan as ‘Obamacare lite,’ furious that it didn't, in their eyes, do enough to unravel the 2010 health care law.“They also threatened to withhold their support until changes were made, and later won concessions. For now, those hardball tactics have disappeared. As the Senate looks to pass its own health care legislation this week, those same House conservatives are taking a more measured approach -- even as several conservatives in the Senate are currently balking at the bill.” http://politi.co/2u2UDDFBUT, BUT, BUT … “Senate health-care bill faces serious resistance from GOP moderates,” by WaPo’s Juliet Eilperin and Amy Goldstein: “A small group of moderate Republican senators, worried that their leaders’ health-care bill could damage the nation’s social safety net, may pose at least as significant an obstacle to the measure’s passage as their colleagues on the right. The vast changes the legislation would make to Medicaid, the country’s broadest source of public health insurance, would represent the largest single step the government has ever taken toward conservatives’ long-held goal of reining in federal spending on health-care entitlement programs in favor of a free-market system.“That dramatic shift and the bill’s bold redistribution of wealth — the billions of dollars taken from coverage for the poor would help fund tax cuts for the wealthy — is creating substantial anxiety for several Republican moderates whose states have especially benefited from the expansion of Medicaid that the Affordable Care Act has allowed since 2014.” http://wapo.st/2sPOf36-- WHO TO WATCH: Sens. Lisa Murkowski (R-Alaska), Shelley Moore Capito (R-W.Va.), Rob Portman (R-Ohio), Cory Gardner (R-Colo.) and Dean Heller (R-Nev.).-- THE PROBLEM: Senate Majority Leader Mitch McConnell is going to have to cajole and lean on moderate and conservative senators to find enough votes. While he may be able to tweak the bill on the margins to bring some of the lawmakers on board -- and lawmakers will be able to add amendments to the underlying bill text -- it’s unclear if he’ll be able to thread the needle for passage next week. As we wrote earlier this week, McConnell is going to put this bill up for a vote no matter what -- he wants lawmakers on the record.KOCH WATCH -- “Koch network ramps up political spending while trying to push Trump team,” by Kevin Robillard in Colorado Springs, Colorado: “The leadership of the Koch brothers' network is brushing off its occasionally chilly attitude toward President Donald Trump, trying to nudge the administration in its direction as the group’s annual summit began Saturday just after Charles Koch met with Vice President Mike Pence. The network of conservative donors announced Saturday it plans to spend between $300 million and $400 million on politics and policy during the 2018 cycle. …“The millions from the Koch network and its wealthy allies will boost the Trump administration on some key priorities, especially tax reform and rolling back regulations. It also will help push back against others — especially Attorney General Jeff Sessions’ desire to implement tough-on-crime policies — and working to make Obamacare repeal efforts more conservative. And they could prove critical to Republican efforts to retain the House and expand a majority in the Senate.” http://politi.co/2t9Ii4k-- “Koch chief says health care bill insufficiently conservative,” by AP’s Steve Peoples: “Tim Phillips, who leads Americans For Prosperity, the Koch network’s political arm, called the Senate’s plans for Medicaid ‘a slight nip and tuck’ of President Barack Obama’s health care law, a modest change he described as ‘immoral.’ ‘This Senate bill needs to get better,’ Phillips said. ‘It has to get better.’” http://apne.ws/2sFaGtsFOR YOUR RADAR -- “Trump allies push White House to consider regime change in Tehran,” by Michael Crowley: “As the White House formulates its official policy on Iran, senior officials and key Trump allies are calling for the new administration to take steps to topple Tehran’s militant clerical government. Supporters of dislodging Iran’s iron-fisted clerical leadership say it’s the only way to halt Tehran’s dangerous behavior, from its pursuit of nuclear weapons to its sponsorship of terrorism.“Critics say that political meddling in Iran, where memories of a 1953 CIA-backed coup remain vivid, risks a popular backlash that would only empower hardliners. That’s why President Barack Obama assured Iranians, in a 2013 speech at the United Nations, that ‘we are not seeking regime change.’ But influential Iran hawks want to change that under Trump. ‘The policy of the United States should be regime change in Iran,’ said Sen. Tom Cotton (R-Ark.), who speaks regularly with White House officials about foreign policy. ‘I don’t see how anyone can say America can be safe as long as you have in power a theocratic despotism,’ he added.” http://politi.co/2tINGIF-- “Trump’s Team Faces Reality in the Middle East,” by the Times of Israel’s Herb Keinon: “Washington is adopting a much different approach to peacemaking than the previous administration, a sign that it has learned from US President Barack Obama’s mistakes. And the mother of all Obama’s mistakes on the Israeli-Palestinian issue came when -- just a few months after being sworn into office -- he made a very clear demand for Israel to stop all settlement activity, everywhere ... The Trump administration is taking a different approach. It is making no public demands ... And, all the while, it is probing the sides to see what they are – and are not – willing to give, and then trying to see if there are ways to bridge the gaps. And it is doing this all very much behind closed doors, without megaphone diplomacy, without public threats of laying down an American blueprint, or dangling promises of high-profile summits.” http://bit.ly/2u398Y5COMING ATTRACTIONS -- “U.S. top court set to rule on religious rights; travel ban looms,” by Reuters’ Lawrence Hurley: “The U.S. Supreme Court is set to rule on Monday in a closely watched religious rights case involving limits on public funding for churches and other religious entities as the justices issue the final rulings of their current term. The nine justices are due to rule in six cases, not including their decision expected in the coming days on whether to take up President Donald Trump’s bid to revive his ban on travelers from six predominantly Muslim countries in which an emergency appeal is pending. Of the remaining cases argued during the court’s current term, which began in October, the most eagerly awaited one concerns a Missouri church backed by a conservative Christian legal group. The ruling potentially could narrow the separation of church and state.” http://reut.rs/2s9V9ylTHE JUICE ....-- SPOTTED AT STEVEN MNUCHIN and LOUISE LINTON’s WEDDING last night at the Mellon Auditorium: President Donald Trump (in black tie) and First Lady Melania Trump, Vice President Mike Pence (who officiated) and Karen Pence, Jared Kushner and Ivanka Trump, Reince Priebus and Sally Priebus, DHS Secretary John Kelly, CIA director Mike Pompeo, Interior Secretary Mike Zinke, Transportation Secretary Elaine Chao, HUD Secretary Ben Carson and Candy Carson, Education Secretary Betsy DeVos, Commerce Secretary Wilbur Ross, EPA Administrator Scott Pruitt, Agriculture Secretary Sonny Perdue, U.S. Trade Representative Robert Lighthizer, National Security Advisor H.R. McMaster, White House Counsel Don McGahn and Shannon McGahn, deputy national security advisor Dina Powell and David McCormick ...... Sean and Rebecca Spicer, Kellyanne Conway, Canadian Finance Minister Bill Morneau, John Paulson, Jim Donovan, Steve Roth, Eddie Lampert, Woody Johnson, Lee Eisenberg, Sen. Orrin Hatch (R-Utah), Tom Barrack, Eli and Jenna Miller, Stephen Miller, House Majority Whip Kevin McCarthy, C. Boyden Gray, Brad and Candice Parscale, Tommy Hicks, Reed Cordish, Rudy Giuliani, Richard and Karen LeFrak and Harrison LeFrak, Bill Paxon and Susan Molinari, Mike Shields and Katie Walsh, Ken Duberstein, Anthony Scaramucci. Seafood was served during cocktail hour, along with filet for dinner and a big white wedding cake. There was lots of beautiful flowers at the wedding, ballerinas performed, bagpipes and then a big band and many people hit the dance floor, according to attendees. Full report from Darren Samuelsohn, Rebecca Morin and Cristiano Lima http://politi.co/2t8w9MZ … 25 photos on one page http://dailym.ai/2sEIl6A-- MNUCHIN was spotted with three agents at DCA early this morning -- he was dropping off one of his kids at the airport.-- WE REPORTED YESTERDAY THAT REP. ADRIANO ESPAILLAT (D-N.Y.) filed a financial disclosure form that listed a checking account with between $5 million and $25 million. His office said he filed the report in error, and the account has between $1,000 and $15,000. The new report has not yet showed up on the clerk’s website.SUNDAY BEST -- GEORGE STEPHANOPOULOS speaks to SENATE MINORITY LEADER CHUCK SCHUMER (D-N.Y.) on ABC’S “THIS WEEK” -- STEPHANOPOULOS: “Are they going to pass this bill?” SCHUMER: “I think it’s 50-50. First, Democrats, we are doing everything we can to fight this bill because it’s so devastating for the middle class. I think they have, at best, a 50-50 chance of passing this bill. To get three senators to vote no, probably -- you can say yes, you can say no, probably 50-50.”-- BRIT HUME talks with HHS SECRETARY TOM PRICE on “FOX NEWS SUNDAY” -- PRICE: “What we’re trying to do here, admittedly, is to thread a needle to make it so that, as the president says, every single American needs to be able to have access to the kind of coverage that they want,” Price said, adding that conversations with Republican holdouts are ongoing. “That’s the nature of the legislative process and that’s what we’ll be working through this week.” More from Patrick Temple-West, whose birthday is today http://politi.co/2t5LvB6-- DANA BASH speaks with OHIO GOV. JOHN KASICH on CNN’S “STATE OF THE UNION” -- BASH -- HE’S OPPOSED TO THE SENATE GOP HEALTH CARE BILL: “OK. So, given the problems that you just laid out, do you think that Senator Portman of Ohio should vote no?” KASICH: “Well, I -- I don’t think the bill's adequate now. And unless it gets fixed, I would -- look, I’m against it. And I’m not against it just because I want to be against it. There’s some things in these bill -- in these bills, in these -- in these provisions that are an improvement. My job, as I see my job as a governor of the state, not as a Republican governor, but the governor of this state, my job is to look not just today, but in the out years, at the impact it's going to have on people who have -- who need help.“Dana, I was at a restaurant on Friday. And I was at a Wendy’s, actually. And I was -- there was a partition. And I looked over at the people that had gathered there. And there were about, I don’t know, 25 kids. All of them were here in Columbus for Special Olympics. And I looked at them and I thought, are these people being served? Are they going to be served by this bill in the future? My conclusion right now is no.”-- CHUCK TODD speaks to SEN. RON JOHNSON (R-WISC.) on NBC'S "MEET THE PRESS": JOHNSON -- ON HEALTH CARE: "[W]hat I'd like to do is slow the process down, get the information, go through the problem-solving process, actually reduce these premiums that have been artificially driven up because of Obamacare mandates. So let's actually fix the problem. But in the end, I come from manufacturing base. I will look at whatever I'm forced to vote on, and I'll ask myself, 'Is this better tomorrow than where we are today? Is it continuous improvement?' And that's what will guide my decision."DEEP DIVE -- WILLIAM D. COHAN in August’s Vanity Fair, “The Untold Story of How Gary Cohn Fell for Donald Trump”: “While [Lloyd] Blankfein was recuperating, Cohn seemed to delight in the attention and adulation he received when he filled in for his boss on earnings calls, industry presentations, and media events, such as The New York Times’s DealBook Conference. That’s when, some say, he became overconfident and decided to inquire of several of his fellow board members about becoming C.E.O., even as Blankfein was responding well to his chemotherapy treatments. ‘Gary made a play to replace Lloyd,’ according to a former Goldman partner. It didn’t work. The board was ‘noncommittal’ to Cohn, he continues. ‘There’s a lot of loyalty to Lloyd on the board.’ ...“The timing was perfect for Jared Kushner, Trump’s son-in-law, to pounce. He approached Cohn, supposedly at the suggestion of mutual friends. ‘Jared Kushner has always been a little starstruck with Goldman Sachs people,’ says a former Goldman partner who knows him well. ‘He’s always liked that sort of promotional edginess that Goldman Sachs has had, and he’s always liked the reputation that Goldman Sachs has the best people, quote unquote, the smartest, savviest people. The idea, by the way, that Jared was suddenly in a position where he actually had the power to call on and hire and lure a number of people like that to the bench side, if you will, was a very, very intoxicating, enticing, and really kind of exciting thing to him,’ the former partner continues. ‘This was an incredibly sort of convenient and opportune kind of thing that came along for Gary because—whether he was going to Washington or not—Gary was out.’” http://bit.ly/2u3jTd1MATT VISER in the Boston Globe, “Jared Kushner got his start as Somerville landlord”: “At 19, he was in the training-wheels stage of his career as a developer, learning as he went, making his share of mistakes, acquiring a landlord’s tough edge and cool calculus -- traits he still manifests in the White House. Learning to fix up and flip clusters of low-end apartment buildings, he used Somerville as his own private laboratory. And he passed the first key test -- he made a profit. Of course, he had a headstart. Much as Trump began his career of deals with a multimillion-dollar boost from his father, Kushner started out with his wealthy father acting as senior partner and offering crucial assistance -- including helping secure $9 million in mortgage loans….“And his efforts paid off -- the properties he bought for $8.3 million sold four years later for $13 million. But Kushner, who did not respond to requests for an interview to discuss his business record in Somerville, also made a number of rookie errors and left numerous angry tenants in his wake. His properties amassed 25 housing complaints over four years, including complaints about overflowing dumpsters, pests, and sewage odors, according to the Globe review. Tenants complained of what they called nonsensical financial dealings. Some renters say they went an entire winter without heat.” http://bit.ly/2t5dGjuWHAT ERIC HOLDER IS READING -- “Analysis indicates partisan gerrymandering has benefited GOP,” by AP’s David Lieb: “The 2016 presidential contest was awash with charges that the fix was in: Republican Donald Trump repeatedly claimed that the election was rigged against him, while Democrats have accused the Russians of stacking the odds in Trump’s favor. Less attention was paid to manipulation that occurred not during the presidential race, but before it — in the drawing of lines for hundreds of U.S. and state legislative seats. The result, according to an Associated Press analysis: Republicans had a real advantage.“The AP scrutinized the outcomes of all 435 U.S. House races and about 4,700 state House and Assembly seats up for election last year using a new statistical method of calculating partisan advantage. It’s designed to detect cases in which one party may have won, widened or retained its grip on power through political gerrymandering. The analysis found four times as many states with Republican-skewed state House or Assembly districts than Democratic ones. Among the two dozen most populated states that determine the vast majority of Congress, there were nearly three times as many with Republican-tilted U.S. House districts.” http://apne.ws/2s5voE7BUSINESS BURST -- “Facebook Is Going Hollywood, Seeking Scripted TV Programming,” by WSJ’s Joe Flint and Deepa Seetharaman: “Facebook to Hollywood: Let’s do lunch. Social networking giant Facebook Inc. is moving its ambitions in TV-quality video to the front burner, taking meetings and making deals with an eye toward launching a slate of original programming by the end of summer, people familiar with the matter said. In meetings with major talent agencies including Creative Artists Agency, United Talent Agency, William Morris Endeavor and International Creative Management Partners, Facebook has indicated it is willing to commit to production budgets as high as $3 million per episode, people familiar with the situation say.” http://on.wsj.com/2rQ6OmzBEYOND THE BELTWAY -- POLITICO Magazine’s “America’s 11 Most Interesting Mayors”: Eric Garcetti, Los Angeles … Hillary Schieve, Reno, Nev. … Kevin Faulconer, San Diego … Greg Fischer, Louisville, Ky. … Marty Walsh, Boston … Michael Hancock, Denver … Jennifer Roberts, Charlotte, N.C. …Tomás Regalado, Miami, Florida … Jackie Biskupski, Salt Lake City, Utah ... Bill Peduto, Pittsburgh … Dan Gilbert, the shadow mayor of Detroit. http://politi.co/2sEZm0wBONUS GREAT WEEKEND READS, curated by Daniel Lippman, filing from Palm Beach, Florida:-- “My Father’s Fashion Tips,” by Tom Junod in GQ: “In 1996, in a piece that was nominated for a National Magazine Award, Tom Junod wrote not only of his dad’s impeccable style but also of the secrets -- and underwear rules -- of a lost generation.” http://bit.ly/2szLZP8-- “Deepest Dive Ever Under Antarctica Reveals a Shockingly Vibrant World,” by Laurent Ballesta in July’s NatGeo: “Our special report offers a rare look at life beneath the frozen continent -- where penguins, seals, and exotic creatures thrive.”With 15 pix on one page http://on.natgeo.com/2s2rV9e (h/t Blake Hounshell)-- “Crimson Tidings: The primordial color gets its due,” by Elizabeth Powers in the Weekly Standard: http://tws.io/2rLD4qR (h/t ALDaily.com)-- “The Wages of War Without Strategy,” by Robert Cassidy and Jacqueline Tame on the Strategy Bridge: “In its wars since 11 September 2001, the United States has arguably cultivated the best-equipped, most capable, and fully seasoned combat forces in remembered history. They attack, kill, capture, and win battles with great nimbleness and strength. But absent strategy, these victories are fleeting. Divorced from political objectives, successful tactics are without meaning.” http://bit.ly/2szMg4p-- “This Is How Big Oil Will Die,” by Seth Miller in NewCo: “It’s 2025, and 800,000 tons of used high strength steel is coming up for auction. The steel made up the Keystone XL pipeline … [which at] its peak ... carried over 500,000 barrels a day for processing at refineries in Texas and Louisiana. But in 2025, no one wants the oil.” http://bit.ly/2szZhLp-- “Supertasters Among the Dreaming Spires,” by Dan Rosenheck in 1843 Magazine: “Every Oxford taster is a scientist in one form or another, ranging from endearingly geeky to absurdly so ... Cambridge [tasters] were methodical, precise and pragmatic – much like Cambridge. Whereas Oxford had people who grew up with wine. They’d just taste and say: Oh, that’s obviously Bordeaux.” http://bit.ly/2rLo5NI -- “Camille Paglia: On Trump, Democrats, Transgenderism, and Islamist Terror,” by The Weekly Standard’s Jonathan V. Last: “Today’s liberalism has become grotesquely mechanistic and authoritarian: It’s all about reducing individuals to a group identity, defining that group in permanent victim terms, and denying others their democratic right to challenge that group and its ideology. Political correctness represents the fossilised institutionalisation of once-vital revolutionary ideas, which have become mere rote formulas.” http://tws.io/2szPMfe (h/t TheBrowser.com)-- “Confessions of a Cartel Hit Man,” by Martin Corona in Men’s Journal: http://mjm.ag/2tDcVvH-- “Can We Blame the Mafia on Lemons?” by Cara Giaimo in Atlas Obscura: “Lemon trees need well-fertilised soil, steady water, and protection from wind and extreme temperature, which come at great cost. Trees need to be coddled for seven or eight years before they produce enough lemons to sell. When they do bear fruit, it’s easy enough for people to steal it.” http://bit.ly/2t0xjJl-- “The 2017 Jefferson Lecture -- Powerlessness and the Politics of Blame” --Martha C. Nussbaum at the Kennedy Center on May 1: “The Greeks and Romans saw a lot of anger around them. But they did not embrace or valorise anger. They did not define manliness in terms of anger, and tended to impute it to women, whom they saw as lacking rationality. However much they felt and expressed anger, they waged a cultural struggle against it, seeing it as destructive of human well-being and democratic institutions.” http://bit.ly/2tDB5X4-- “About Tomorrow,” by Bruce Wexler in E-Flux: “Human beings differ from other animals with regard to ... post-natal neuroplasticity in two important ways. First, our brains are more immature at birth and susceptible to environmental shaping to a greater degree and for a longer time. Second, humans are the only animals that shape and reshape the environments that shapes their brain. This powerful combination is the basis of cultural evolution, and of most features of human minds, behavior and communities.” http://bit.ly/2sL8uPwSPOTTED: Former Vice President Joe Biden on Saturday, with a small Secret Service detail, on the Acela out of New York. He got off in Wilmington, rocking a pair of sunglasses, one earbud in and carrying a briefcase -- “looking as relaxed and cool as ever,” per our tipster.OUT AND ABOUT -- Susan Glasser and Peter Baker hosted a farewell party last night at their house for Indira Lakshmanan and Dermot Tatlow, who are moving to St. Petersburg, Florida, next week as Indira takes up her post as Craig Newmark Chair in Journalism Ethics at The Poynter Institute for Media.SPOTTED: German Amb. Peter Wittig and Huberta von Voss-Wittig, Afghan Amb. Hamdullah Mohib and Lael Mohib, Judy Woodruff and Al Hunt, Marty Baron, Andrea Mitchell, Nihal Krishan, Nancy Cook and Christopher Rowland, former Pakistani Amb. Husain Haqqani and Farahnaz Ispahani, Mike Oreskes and Geraldine Baum, former U.S. Ambs. Melanne and Phil Verveer, former U.S. Amb. Steve Sestanovich, Katharine Weymouth, Mark Landler, Julie Davis, David Sanger, Margaret Carlson, Juliet Eilperin, Laura Meckler, Ben Chang, Christina Sevilla and Steve Rochlin, Justin Kenny, Heidi Crebo-Rediker and Doug Rediker, Dana Thomas, Amanda Downes, David Rennie, Jonas Parello-Plesner, Bay Fang, Steve Heuser, Mary Louise Kelly, Manuel Roig-Franzia and Ceci Connolly, Nicole Raben, Denise Couture.-- SPOTTED at a surprise birthday party last night for Ziad Ojakli at Kellari Taverna on K Street: Sumya Ojakli, Angela Flood, Alison Jones, Mercy and Matt Schlapp, David and Gretchen Hobbs, Bruce Andrews, Pam Thiessen, Nick Calio and Eric Ueland.-- SPOTTED on the rooftop of The Brixton for a mini-reunion of alumni of the Obama administration NSC: Terry Szuplat, Eric Pelofsky, Dan Schneiderman, Jon Wolfsthal, Yael Lempert, Michael Sessums, Ben Chang, Salman Ahmed, Evan Medeiros, Bernadette Meehan, Meg Doherty, Stacey May, Andrew Scott, Matt Kaczmarek, Brian Nilsson.SPOTTED at Ron and Sara Bonjean’s annual “Good Pants Ranch Summer Party” yesterday in Purcellville, Va. (a camel made an appearance): Paul Kane, Jo Maney, John Scofield, Dana Bash, Anne Brady, Matt Dornic and Kyle Volpe, Doug Heye, Emily Miller, Fran Decker, Jared Allen and Jackie Kucinich, Kenny Day, Rebecca Haller, Sheldon and Shannon Bream, Matt Wolking, Tom Williams, David and Jenny Drucker, Chris Bond, Dan Ronayne, Tracey and Nick Lintott, Jim Richards and Brian Walsh.--The RNC held their summer meeting this weekend at the Four Seasons Hotel in downtown Chicago, Illinois. SPOTTED: Vice President Mike and Mrs. Karen Pence, Speaker Paul Ryan, Sen. Tom Cotton (R-Ark.), Rep. Marsha Blackburn (R-Tenn.), Rep. Michael Burgess (R-Texas), RNC Chairwoman Ronna Romney McDaniel, RNC co-chairman Bob Paduchik, RNC chief of staff Sara Armstrong, Arkansas state chairman Doyle Webb, Ohio state chairwoman Jane Timken, Hunter Wallace and Suhail Khan.WEEKEND WEDDINGS -- MICHELLE FIELDS married JAMIE WEINSTEIN in a ceremony yesterday at the Breakers in Palm Beach. Dinner and dancing was held in the Mediterranean Ballroom overlooking the Atlantic Ocean. Fields is a Breitbart and HuffPo alum who now runs JMW Strategies with Weinstein, a commentator and host of “The Jamie Weinstein Show” podcast. They met as reporters at the Daily Caller. They served crab cakes, lobster tail medallions, sliced beef tenderloin, and citrus panko crusted sea bass along with huge ice-cream sundaes (there were also two tomato bars in a pre-dinner reception because Jamie is a big fan of tomatoes). Partiers hoisted Fields and Weinstein in the air during the hora. Colorful performers dancing on stilts also were a hit. The couple is flying out to Europe today on their honeymoon: they’ll visit Italy and Morocco and take a river cruise from Budapest to Munich.SPOTTED: Juleanna Glover hitting the dance floor early with Christopher Reiter, Benny Johnson shaking hands with Oliver Darcy (who had written critical pieces on IJR), bridesmaids Lauren Hagen, Betsy Woodruff, and Kathryn Lyons, Will Rahn, Taylor Lorenz, Ben Jacobs, Olivia Nuzzi, Asawin Suebsaeng and Liz Brown, Jonathan Swan, Vince and Alison Coglianese, Tim Lim, Josiah Ryan, Matt Lewis andErin DeLullo, Katelyn Rieley Johnson, Alex and Nancy Pappas, Jonathan and Anna Beth Strong, Mike Dunkle, Mitchell Sutherland, Guy Benson, Amber Smith.--PICS http://bit.ly/2rQjf1M … http://bit.ly/2t9fjx9 ... http://bit.ly/2sPQu6O …http://bit.ly/2sEZpt2 … First kiss http://bit.ly/2u3cWJ2 … First dance http://bit.ly/2u3enHq … The decadent cake http://bit.ly/2sPMqU3-- Politico reporter (and author of Morning Energy) Anthony Adragna married longtime girlfriend Meghan Cassidy in a ceremony at the historic St. Francis Hall in Northeast D.C. on Saturday evening. Cassidy is a teacher at Gonzaga High School who just graduated from a master’s program at Georgetown. The couple met in summer 2013, hit it off after being set up on a blind date by mutual friends and have been together ever since. Pool report: “The couple exchanged vows outdoors, surrounded by the lush greenery of the historic Renaissance-style hall, built in 1931. The lively reception featured everything from the Isley Brother’s Shout to Taylor Swift’s Shake It Off and had guests young and old on the dance floor all night long.” Pics http://bit.ly/2t8YfHp ... http://bit.ly/2t9Pld0SPOTTED: Heather Caygle and Aaron Lorenzo, Brian Fung and Ryan Kellett, Mikaela Lefrak, Dean Scott and Rachel Leven--“Kristin Donnelly, Rick Bosh” -- N.Y. Times: “The bride, 36, is a White House producer in Washington for NBC News. She graduated from Syracuse. ... The groom, 36 and known as Rick, is a producer for ‘Andrea Mitchell Reports’ on MSNBC. He graduated from Southern Methodist University. ... The couple met in March 2010 when they worked as producers for day programming at MSNBC.” With pic http://nyti.ms/2u2PMlS--“Pia Carusone, Leanne Pittsford”: “Ms. Carusone, 37, is a political consultant and a senior adviser to Americans for Responsible Solutions, a Washington-based gun violence prevention organization, founded by Gabrielle Gifford and Mark Kelly. Ms. Carusone was until June 2012 the chief of staff to Ms. Giffords, then an Arizona congresswoman. Ms. Carusone is also a founder of Republic Restoratives Distillery, which is also in Washington and makes vodka, bourbon and rye whiskey. She graduated from Bard College and is now a governor of the school’s alumni association. ... Ms. Pittsford, 36, is the chief executive of Start Somewhere, a company in Washington that operates Lesbians Who Tech and two other programs aiming to increase diversity in the technology sector. She graduated from California Polytechnic State University-San Luis Obispo, and received a master’s degree in education with a concentration on equity and social justice from San Francisco State University.” With pic http://nyti.ms/2t8yfvQBIRTHWEEK (was yesterday): Kirsten Hughes, chair of the MassGOP (hat tip: Natalie Boyse)BIRTHDAYS: WSJ and POLITICO alum Patrick O’Connor, now with CGCN Group, is 41 ... CNN’s Betsy Klein ... Josh Lahey, principal of the Podesta Group, who once hiked all 2,100 miles of the Appalachian Trail starting in Georgia and ending in Maine … Justice Sonia Sotomayor is 63 ... civil rights activist James Meredith is 84 ... Anthony Bourdain is 61 ... Jeremy Bearer-Friend, Sen. Elizabeth Warren’s tax policy maven, moving to NYC this fall to teach tax law at NYU (h/t Alex Levy) ... tech guru Laurent Crenshaw, YELP’s director of public policy, is 37 --he celebrated Friday evening at a pop-up party inside of the National Union Building on 9th and F st NW with some of Capitol Hill’s finest (h/t Stewart Verdery) ... Politico’s Patrick Temple-West ... N.Y. Post’s Reuven Fenton ... Rep. Leonard Lance (R-NJ) is 65 ... Dan Meyers, VP at DCI Group ... John Randall, VP of digital at CRAFT ... Robert Harvey ... Jackie Bradford, pres and GM of NBC4 in DC ... Danielle Doheny is 3-0 ... CBS and Reuters alum Corbett Daly, bro of Uncles Matthew and Brendan ... AP alum John Heilprin, now senior journalist and editor for the int’l service of the Swiss Broadcasting Corp. ... Ambassador Melanne Verveer ... Tita Freeman ... Alan McQuinn ... former Rep. Carolyn Kilpatrick (D-Mich.) is 72 ...... Scott Zumwalt, senior director at Bully Pulpit Interactive, is 33 … Alan McQuinn, ITIF's research analyst (h/t Samantha Greene) ... John Randolph Thornton, author of the novel “Beautiful Country,” is 26 ... John Meyer ... Dan Spinelli ... Eric Litmer ... Taylor Haulsee ... Alberto “Beto” Cardenas of Vinson & Elkins ... Abbie Sorrendino of Senate Rules …Gretchen Yelmini … Bryan Bernys ... IAVA alum John Alexander Nicholson ... Mike Gehrke … Jon Carson … Summer Oesch … Jason Stephany … Martha Vukelich-Austin … Marc Caplan … Mora Segal … Heidi Johnson (h/ts Teresa Vilmain) … James Michael Thornberry ... Hank Greenwald, famed for his long run as the SF Giants baseball play-by-play man ... Ted Pease is 62 ... Carly Simon is 72 ... Phyllis George is 68 ... Ricky Gervais is 56 (h/ts AP)

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24 июня, 23:20

The Lost Goldman Sachs 1985 Fixed Income Recruiting Video

Authord by Sarah Butcher via eFinancialCareers.com, In 1985, Goldman Sachs was still a partnership. The current partners owned around 80% of the firm, retired partners held the remainder. Lloyd Blankfein was a 31 year-old trader at J. Aron, the commodities house Goldman had purchased four years earlier. Run by John Weinberg, a former M&A banker, Goldman in 1985 was mostly a U.S. operation. There were a handful of overseas offices, including one in London, but in the words of Lisa Endlich, Goldman’s London few hundred staff were sitting in an, “unair-conditioned setting on one floor of an office building.” Nonetheless, Goldman wanted expansion. In 1986, it decided to go for growth. Over the next 12 years, the firm doubled in size and its capital increased five times. This is the world depicted by a fixed income recruiting video made by GS in 1985 which has just surfaced on Youtube. Despite being posted to the video sharing network in March 2015, it’s only just been unearthed. We’ve posted the 10 minute video below (3 mins on YouTube are blank). Goldman used it to make a pitch for, “exceptionally talented and motivated individuals,” to work in the fixed securities markets which it said were experiencing, “rapid growth.” Highlights of 1985 Goldman Sachs included smoking at the desk, endless coffee in paper cups, pagers in belts, big hair, big computers, a lot of telephones, a lot of paper and a lot of human beings. The video supplements this with an encouraging ’80s musical accompaniment. “The pace is fast, and the atmosphere is intense,” Goldman’s former self warns: “Emotions change from minute to minute.” Prerequisites for getting a job there included, “intelligence, independence, a strong desire to succeed, creativity and the ability the quickly translate ideas into action…” If anyone knows who the people in the video are, please enlighten us (future GS CEO Jon Corzine can be seen shouting into the phone at 7 minutes 30 seconds). If you like the genre you can always go on to sample the 1987 documentary about Paul Tudor Jones. 

21 июня, 21:08

Does Goldman's Lloyd Blankfein Have A Gary Cohn Problem (And Vice-Versa)?

Today's decision is a setback for the environment and for the U.S.'s leadership position in the world. #ParisAgreement— Lloyd Blankfein (@lloydblankfein) June 1, 2017 Lloyd’s entry level tweet decrying the U.S. withdrawal from the climate accords was an expression of mild displeasure with an administration that’s welcomed, with open arms, a cabal of Goldman executives who’ve been paddling through the muck trying to figure out how Wall Street can profit from last November's surprising turn of electoral events. Chief among them was Goldman’s brightest star: former Chief Operating Officer, Gary Cohn. As current director of the National Economic Council, Gary maintains high hopes that he’ll be able to make his vision of America great again just like it was before those nasty days in 2008 that brought the sub-prime party — and the world economy — to a crashing halt. The old saw — there are no problems, just opportunities — seemed to be the operative dynamic for Lloyd and Gary as they both donned Speedos for an eyes-open belly flop into the swamp. In the heady weeks following the election the swamp seemed more like a kitty pool teeming with giddy denizens splashing themselves with moolah. The stock market continued to spill out earnings like a slot machine having hit trip 7s; after all, it seemed like those pesky Dodd-Frank regulations would soon be consigned to the dustbin of financial history. Outsiders might have thought that Lloyd and Gary were once joined at Goldman’s hip — sort of a financial version of Ben and Jerry — but in recent years there were indications that trouble was looming. It was common knowledge on the Street that Cohn coveted Goldman’s top spot and, equally known, Lloyd wasn’t going to give it up. One source who knew Gary well offered a hands-down affirmation that he was the smartest/brightest/most hardworking guy down at 200 West Street and if anyone could accomplish the impossible with a new administration, it was Cohn. Consultations with a friend by the name of Jared Kushner resulted in Gary’s deployment to the front lines to help grow the economy through infrastructure projects — turbo-charged by private equity investments — which in turn would create many, many jobs. There was a credible precedent to this, according to the source, citing President Eisenhower’s pushing of the 1956 National Interstate and Highways Defense Act, which initiated the construction of some 41,000 miles of cross-country highways; at the time, the largest public works project in American history. Ironically, it was another case that involved the Russkis, albeit of the Cold-War type, whose nuclear posturing begged the question of how was the military going to move troops quickly and effectively from coast to coast over roads that were patch-worked together with no particular rhyme nor reason. In those simpler days before private equity, construction costs were defrayed by adding one red cent, so to speak, to the tax paid on a gallon of gas. But let’s not forget that while Ike did create jobs, none were filled by illegal Mexican immigrants because the President had deported some 1.5 million in his notoriously effective Operation Wetback two years prior. Gary Cohn has had his work cut out for him; with all the scandals and controversies the swamp has taken on a quicksand texture and he’s been desperately treading water trying show some real progress with his infrastructure efforts. Then came Lloyd’s entrance into the twitterverse and his objection to Gary’s boss pulling the U.S. out of the climate accords. It caused a bit of hip dysplasia between the former colleagues and Cohn offered a response; writing an Op-Ed for the Wall Street Journal with H.R. McMaster, the National Security advisor, offering this bit of America First wisdom. The world is not a ‘global community’ but an arena where nations, non-governmental actors and business engage and compete for advantage . It was a shot fired over Blankfein’s bow: no more Mr Nice Guy for Uncle Sam. If we’re going to play world leader then screw the tree-huggers, the “Buy the World a Coke” types, all those warm and fuzzy feelers: it’s time to go all Gordon Gekko and if Lloyd needs a friend perhaps he better get himself a dog. Lloyd seemed to take up the challenge responding with a tweet on June 9. Just landed from China, trying to catch up.... How did "infrastructure week" go?— Lloyd Blankfein (@lloydblankfein) June 9, 2017 Lloyd thumbing his nose at his once second-in-command? A nah, nah, nah, nah bit of tweeting one-upmanship? Now Gary is a big, lumbering, 6-foot-3 bear of a guy, with a reputation for aggressive, in-your-face posturing so perhaps with that in mind, Lloyd thought it best to walk back the intention of the tweet, following up with a can’t-we-all-get-along message inspired by the Virginia ball field shootings. One way to honor DC victims: Dems & Reps work TOGETHER & make progress on Infrastructure, Health care, Tax reform, Immigration, etc. Unify.— Lloyd Blankfein (@lloydblankfein) June 15, 2017 To date, none of Lloyd’s tweet wishes have been fulfilled — not even close — and the future of Gary’s infrastructure endeavors remain clouded. There has been talk that it’s Janet Yellen’s job that’s on Gary’s radar screen; something he denies. Nevertheless it has been reported that he will lead the search for a “qualified” replacement when Yellen’s term at the Fed expires at the end of January. Truth be told, a restless Gary may find, with credible cause, that he is the most qualified of the current bunch of swamp-friendly financial types. For Goldman Sachs — a company known for pivoting with the political winds — there’s nothing that can shake loose the all-in-the-family connection with ex-Goldman alums. Like the mafia, it’s in the DNA, and when I recently asked Jake Siewert, head of Goldman’s PR division, whether the firm still supports Gary’s work, the architect behind the 2013 campaign to turn Lloyd into more of a human being sent me this comment. I’m glad Gary is there. He’s a pragmatic, sensible voice and we can use more of that in Washington. Pragmatism has its limits and while a dive into the swamp and a race for the riches was a pragmatic decision for both Lloyd and Gary, considering an exit strategy might also be a wise possibility; especially if the President’s base becomes disillusioned with a lack of infrastructure inspired job creation. One needs only to recall how “Goldman Sachs” was used as a Trump campaign epithet, linking Hillary to the firm, or the shouts of same leveled at Ted Cruz at the RNC convention for his wife’s employment at the Vampire Squid (according to Goldman spokesperson, Michael DuVally, Heidi Cruz, an investment manager, left during the campaign but is now back at her desk). Looking down the road... Goldman has more money than God so that Lloyd’s continued work on God’s behalf will continue no matter who sits in the Oval Office. Gary, however, is vulnerable. I spoke with former Bear Stearns executive and veteran Wall Streeter, Richard Marin, who offered Cohn this suggestion: Be wary and lawyer up. The President’s ease of throwing staffers under the bus that that is heading straight for him seems pretty much assured. I hate to see even an erstwhile and accomplished GS veteran get trashed by association. During these unpredictable times, offering unpredictable outcomes, perhaps Gary and Lloyd might find solace by reaching back into those kinder, gentler, pre-IPO days, when a true statesmen like the late John C. Whitehead stood at Goldman’s helm. A former Deputy Secretary of State under Ronald Reagan his sage advice, the so-called “ten commandments,” remain enshrined in Goldman culture. His global pragmatism led him to become a passionate supporter of U.S. involvement with the United Nations and that’s when I met him. In 1995, Pacific Street Films, my company, produced, In Search for Peace: Fifty Years of the United States in the United Nations (narrated by Paul Newman) which included Whitehead as an interviewee. Whitehead seemed cast out of the same mold as another character from Oliver Stone’s Wall Street: Lou Mannheim (Hal Holbrook) whose sane and sensible thinking provided a counterpoint to Gekko’s winner-take-all philosophy. His words of wisdom, spoken to eager-beaver Bud Fox (Charlie Sheen), seem severely dated by current Wall Street standards. The money you make for people helps create science and research jobs, don’t sell that out. Quaint sentiments for both Lloyd and Gary to consider following the meteoric rise of greed-fueled proprietary trading after Goldman went public. Again, in another Wall Street tête-à-tête, Bud offers Lou some prescient advice. The main thing about money, Bud, it makes you do things you don’t want to do. Take heed guys.... Joel Sucher is a co-founder of Pacific Street Films (together with Steven Fischler) and has written for a number of platforms including American Banker, In These Times, HuffPost and Observer. com. He and Pacific Street Films co-founder, Steven Fischler, are working on a streaming series about their experiences at NYU Film School. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

21 июня, 21:08

Does Goldman's Lloyd Blankfein Have A Gary Cohn Problem (And Vice-Versa)?

Today's decision is a setback for the environment and for the U.S.'s leadership position in the world. #ParisAgreement— Lloyd Blankfein (@lloydblankfein) June 1, 2017 Lloyd’s entry level tweet decrying the U.S. withdrawal from the climate accords was an expression of mild displeasure with an administration that’s welcomed, with open arms, a cabal of Goldman executives who’ve been paddling through the muck trying to figure out how Wall Street can profit from last November's surprising turn of electoral events. Chief among them was Goldman’s brightest star: former Chief Operating Officer, Gary Cohn. As current director of the National Economic Council, Gary maintains high hopes that he’ll be able to make his vision of America great again just like it was before those nasty days in 2008 that brought the sub-prime party — and the world economy — to a crashing halt. The old saw — there are no problems, just opportunities — seemed to be the operative dynamic for Lloyd and Gary as they both donned Speedos for an eyes-open belly flop into the swamp. In the heady weeks following the election the swamp seemed more like a kitty pool teeming with giddy denizens splashing themselves with moolah. The stock market continued to spill out earnings like a slot machine having hit trip 7s; after all, it seemed like those pesky Dodd-Frank regulations would soon be consigned to the dustbin of financial history. Outsiders might have thought that Lloyd and Gary were once joined at Goldman’s hip — sort of a financial version of Ben and Jerry — but in recent years there were indications that trouble was looming. It was common knowledge on the Street that Cohn coveted Goldman’s top spot and, equally known, Lloyd wasn’t going to give it up. One source who knew Gary well offered a hands-down affirmation that he was the smartest/brightest/most hardworking guy down at 200 West Street and if anyone could accomplish the impossible with a new administration, it was Cohn. Consultations with a friend by the name of Jared Kushner resulted in Gary’s deployment to the front lines to help grow the economy through infrastructure projects — turbo-charged by private equity investments — which in turn would create many, many jobs. There was a credible precedent to this, according to the source, citing President Eisenhower’s pushing of the 1956 National Interstate and Highways Defense Act, which initiated the construction of some 41,000 miles of cross-country highways; at the time, the largest public works project in American history. Ironically, it was another case that involved the Russkis, albeit of the Cold-War type, whose nuclear posturing begged the question of how was the military going to move troops quickly and effectively from coast to coast over roads that were patch-worked together with no particular rhyme nor reason. In those simpler days before private equity, construction costs were defrayed by adding one red cent, so to speak, to the tax paid on a gallon of gas. But let’s not forget that while Ike did create jobs, none were filled by illegal Mexican immigrants because the President had deported some 1.5 million in his notoriously effective Operation Wetback two years prior. Gary Cohn has had his work cut out for him; with all the scandals and controversies the swamp has taken on a quicksand texture and he’s been desperately treading water trying show some real progress with his infrastructure efforts. Then came Lloyd’s entrance into the twitterverse and his objection to Gary’s boss pulling the U.S. out of the climate accords. It caused a bit of hip dysplasia between the former colleagues and Cohn offered a response; writing an Op-Ed for the Wall Street Journal with H.R. McMaster, the National Security advisor, offering this bit of America First wisdom. The world is not a ‘global community’ but an arena where nations, non-governmental actors and business engage and compete for advantage . It was a shot fired over Blankfein’s bow: no more Mr Nice Guy for Uncle Sam. If we’re going to play world leader then screw the tree-huggers, the “Buy the World a Coke” types, all those warm and fuzzy feelers: it’s time to go all Gordon Gekko and if Lloyd needs a friend perhaps he better get himself a dog. Lloyd seemed to take up the challenge responding with a tweet on June 9. Just landed from China, trying to catch up.... How did "infrastructure week" go?— Lloyd Blankfein (@lloydblankfein) June 9, 2017 Lloyd thumbing his nose at his once second-in-command? A nah, nah, nah, nah bit of tweeting one-upmanship? Now Gary is a big, lumbering, 6-foot-3 bear of a guy, with a reputation for aggressive, in-your-face posturing so perhaps with that in mind, Lloyd thought it best to walk back the intention of the tweet, following up with a can’t-we-all-get-along message inspired by the Virginia ball field shootings. One way to honor DC victims: Dems & Reps work TOGETHER & make progress on Infrastructure, Health care, Tax reform, Immigration, etc. Unify.— Lloyd Blankfein (@lloydblankfein) June 15, 2017 To date, none of Lloyd’s tweet wishes have been fulfilled — not even close — and the future of Gary’s infrastructure endeavors remain clouded. There has been talk that it’s Janet Yellen’s job that’s on Gary’s radar screen; something he denies. Nevertheless it has been reported that he will lead the search for a “qualified” replacement when Yellen’s term at the Fed expires at the end of January. Truth be told, a restless Gary may find, with credible cause, that he is the most qualified of the current bunch of swamp-friendly financial types. For Goldman Sachs — a company known for pivoting with the political winds — there’s nothing that can shake loose the all-in-the-family connection with ex-Goldman alums. Like the mafia, it’s in the DNA, and when I recently asked Jake Siewert, head of Goldman’s PR division, whether the firm still supports Gary’s work, the architect behind the 2013 campaign to turn Lloyd into more of a human being sent me this comment. I’m glad Gary is there. He’s a pragmatic, sensible voice and we can use more of that in Washington. Pragmatism has its limits and while a dive into the swamp and a race for the riches was a pragmatic decision for both Lloyd and Gary, considering an exit strategy might also be a wise possibility; especially if the President’s base becomes disillusioned with a lack of infrastructure inspired job creation. One needs only to recall how “Goldman Sachs” was used as a Trump campaign epithet, linking Hillary to the firm, or the shouts of same leveled at Ted Cruz at the RNC convention for his wife’s employment at the Vampire Squid (according to Goldman spokesperson, Michael DuVally, Heidi Cruz, an investment manager, left during the campaign but is now back at her desk). Looking down the road... Goldman has more money than God so that Lloyd’s continued work on God’s behalf will continue no matter who sits in the Oval Office. Gary, however, is vulnerable. I spoke with former Bear Stearns executive and veteran Wall Streeter, Richard Marin, who offered Cohn this suggestion: Be wary and lawyer up. The President’s ease of throwing staffers under the bus that that is heading straight for him seems pretty much assured. I hate to see even an erstwhile and accomplished GS veteran get trashed by association. During these unpredictable times, offering unpredictable outcomes, perhaps Gary and Lloyd might find solace by reaching back into those kinder, gentler, pre-IPO days, when a true statesmen like the late John C. Whitehead stood at Goldman’s helm. A former Deputy Secretary of State under Ronald Reagan his sage advice, the so-called “ten commandments,” remain enshrined in Goldman culture. His global pragmatism led him to become a passionate supporter of U.S. involvement with the United Nations and that’s when I met him. In 1995, Pacific Street Films, my company, produced, In Search for Peace: Fifty Years of the United States in the United Nations (narrated by Paul Newman) which included Whitehead as an interviewee. Whitehead seemed cast out of the same mold as another character from Oliver Stone’s Wall Street: Lou Mannheim (Hal Holbrook) whose sane and sensible thinking provided a counterpoint to Gekko’s winner-take-all philosophy. His words of wisdom, spoken to eager-beaver Bud Fox (Charlie Sheen), seem severely dated by current Wall Street standards. The money you make for people helps create science and research jobs, don’t sell that out. Quaint sentiments for both Lloyd and Gary to consider following the meteoric rise of greed-fueled proprietary trading after Goldman went public. Again, in another Wall Street tête-à-tête, Bud offers Lou some prescient advice. The main thing about money, Bud, it makes you do things you don’t want to do. Take heed guys.... Joel Sucher is a co-founder of Pacific Street Films (together with Steven Fischler) and has written for a number of platforms including American Banker, In These Times, HuffPost and Observer. com. He and Pacific Street Films co-founder, Steven Fischler, are working on a streaming series about their experiences at NYU Film School. -- This feed and its contents are the property of The Huffington Post, and use is subject to our terms. It may be used for personal consumption, but may not be distributed on a website.

30 сентября 2016, 17:09

Топ-10 самых инновационных университетов мира

Считается, что американская университетская система – это двигатель инноваций и прогресса, и это подтверждает рейтинг инновационных университетов мира от Reuters.

03 октября 2013, 11:50

Черная метка

Пока основное внимание средств массовой (дез)информации сосредоточено на перетягивании каната республиканцами и демократами в американском конгрессе, вчера в США состоялось не менее значимое, но гораздо менее заметное для широкой публики событие. Пятнадцать ведущих американских банкиров, среди посетителей были руководители банков GoldmanSachs, JPMorgan и так далее, 02 октября посетили президента США и доступным для понимания языком постарались объяснить ему, чем может закончиться технический дефолт американских казначейских облигаций. Несмотря на то, что среди посетителей были руководители гораздо более крупных банков, чем GoldmanSachs, именно его руководитель Ллойд Бланкфейн высказал общую позицию банкиров по этому вопросу. Вкратце это выглядело следующим образом: «Вы можете спорить по политическим вопросам или даже выносить их для публичного обсуждения, но не надо использовать в качестве дубины угрозу отказа США погашать долг по своим обязательствам. Прецеденты с остановкой правительства были, прецедентов с дефолтом пока не было. Мы такого раньше не видели, и я не горю желанием оказаться свидетелем этого процесса.» Поскольку банкиры вполне ясно представляют себе, во что может вылиться отказ США расплачиваться по своим обязательствам, в том числе и для них лично, то они донесли до президента США всю серьезность происходящего, предварительно выслушав его позицию. Каких-либо дебатов о том, что США всерьез решат не оплачивать долги, не было. Этот визит был довольно показательным с разных точек зрения. Фактически представители истинных хозяев или, иными словами, совет директоров ООО «Соединенные Штаты Америки» посетил единоличный исполнительный орган данной лавочки и публично вручил ему черную метку. Вряд ли президент США рискнет ослушаться такой рекомендации. На мой взгляд, это может случиться лишь в одном единственном случае: если хозяевами Америки было принято политическое решение полностью сменить правила игры, и ответственными за надвигающийся крах было решено назначить Федеральный резерв и приближенные к нему банки. Хотя это и выглядит крайне маловероятным, но богатые люди – это особые люди, и полностью исключать такого развития событий все-таки не стоит.