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“Condensed, Cliff Notes edition, Goldman has the most shortable share price of all the big banks at around $100 and is quite liquid; it is more susceptible to mo-mo traders than it is to it's own book value, it is highly levered into the European debt/banking mess, and last but not least, Goldman is the derivatives risk concentration leader of the world - bar none! So, if anyone is in need of CDS as a good solid hedge, it should be Goldman, no?”From here http://boombustblog.com/BoomBustBlog...-Probably.html
The problem is bailout. They have access to the Federal Reserve hush fund....shh....
Not big enough. You've said debt is money try turning the world's debt into cash. GS has lots of sovereign debt on its books. They have it on lots of leverage. "They" are trying to get the Greek debt write off to not be a credit event to trigger the debt coverage. If "they" succeed then those sovereign debt bonds are naked. GS is in a bad way.
Not big enough. You've said debt is money try turning the world's debt into cash. GS has lots of sovereign debt on its books. They have it on lots of leverage. "They" are trying to get the Greek debt write off to not be a credit event to trigger the debt coverage. If "they" succeed then those sovereign debt bonds are naked. GS is in a bad way.
"They"= the governments in the EU.
I understand that, but there is a huge risk our government will still bail them out. Goldman Sachs is our de facto government as far as I am concerned. This is not a business issue. This is a political one. The US may even find a way to blackmail Europe.
You need to realize that the only thing between GS and printing money is they need to buy something with high face value. Then they insist on getting its face value even though they know they bought junk. The FED says, "oh OK here you go" sorry it did not work out so well. Please try harder next time not to make such easy money." That's the game.
The problem with GS and these banks is how intertwined they are with the government, the fed (how many white house and fed officials worked at goldman?). They're all kind of the same.
-It's not like Joe's plumbing going public. Then they hit a rough patch and you short it, and make money. Capitalism goes up and down for Joe's plumbing.
Does capitalism work for goldman?
-A longer term arguement that I would support....shorting goldman or the financials on the theory that financials have peaked. It ties into Jim Rogers commodity super cycle theory. We are in an era of "Stuff", and paper/money shuffling is in decline. We go through these 20-25 year cycles. Wall St, money shuffling, then agriculture, hard assets.
Goldman Sachs only weakness is their potential future growth. The government will not let them fail and will also allow them to literally destroy the American economy by letting them handout supremely crappy loans to people who they know cannot repay them. Then GS makes billions by betting that the loans they handout will fail. Then the taxpayers foot the bill for bailouts on AIG, who insured Goldman Sach's retarded loans in the first place. It's government backed legal fraud that we're all paying for.
With that kind of power and influence, I wouldn't short them. They're also trading near their 52 week lows. I do personally hope that they go bankrupt but I don't see it happening. Besides, the criminals who run the joint would just run across the street to JP Morgan & Chase.
Goldman Sachs only weakness is their potential future growth. The government will not let them fail and will also allow them to literally destroy the American economy by letting them handout supremely crappy loans to people who they know cannot repay them. Then GS makes billions by betting that the loans they handout will fail. Then the taxpayers foot the bill for bailouts on AIG, who insured Goldman Sach's retarded loans in the first place. It's government backed legal fraud that we're all paying for.
With that kind of power and influence, I wouldn't short them. They're also trading near their 52 week lows. I do personally hope that they go bankrupt but I don't see it happening. Besides, the criminals who run the joint would just run across the street to JP Morgan & Chase.
Also they now have a 0 interest rate cash register to buy up, oh I don't know, Australia.
I wonder if there's ever been a company as quasi government as goldman in the last 30-50 years.
They seem even more intertwined, than say, Chrysler 30 years ago. I think shorting goldman would be like shorting a 20 year old criminal in a town....and his dad is the booking officer. Or his dad owns the booking officer. Is he really going to go to jail?
Also, goldman is about where it was 10 years ago. I think that it went public at such a high price, the $100 price is kind of an illusion. I wonder if it will ever really collapse.
Well... It is only as strong as the government. So how stable is the current system?
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