Goldman Sachs Chairman & CEO Says Company Is Part of a “Virtuous Cycle” With a “Social Purpose” Even as It Apparently Moves Markets in “Miraculous” Ways (SEC, Where Are You?)

~~By InsightAnalytical-GRL

A couple of weeks ago we brought you this little ditty about how some executive at Goldman Sachs explained how moral the marketplace is (See: This Would Be the Laugh of the Day if It Weren’t So Aggravating: Pious Rationalizations About “Morality in the Marketplace” from Our Buddies at Goldman Sachs (Posted 10/21/2009). 

Goldman Sachs’s Griffiths Says Inequality Helps All

A Goldman Sachs International adviser defended compensation in the finance industry as his company plans a near-record year for pay, saying the spending will help boost the economy.

“We have to tolerate the inequality as a way to achieve greater prosperity and opportunity for all,” Brian Griffiths, who was a special adviser to former British Prime Minister Margaret Thatcher, said yesterday at a panel discussion at St. Paul’s Cathedral in London. The panel’s discussion topic was, “What is the place of morality in the marketplace?”

Goldman Sachs Group Inc., based in New York, set aside $16.7 billion for compensation and benefits in the first nine months of 2009, up 46 percent from a year earlier and enough to pay each worker $527,192 for the period. The amount set aside this year is just shy of the all-time high $16.9 billion allocated in the first three quarters of 2007. Goldman Sachs spokesman Michael DuVally in New York declined to comment.  (MORE)

Now, we’re in for ANOTHER treat from the grand poobahs at Goldman…From The Sunday Times (U.K.) profile on Goldman’s chairman and CEO, Lloyd Blankfein:

November 8, 2009

I’m doing ‘God’s work’. Meet Mr Goldman Sachs

John Arlidge

…

Luckily for him and his firm, he’s a damn good salesman. He starts with a little humility. He understands that “people are pissed off, mad, and bent out of shape” at bankers’ actions. Goldman played its part in the meltdown that almost destroyed the global financial system. It, like most other banks, lent too much money, made its first quarterly loss for more than a decade last year and ended up taking bail-out cash from Washington. “I know I could slit my wrists and people would cheer,” he says. But then, he slowly begins to argue the case for modern banking. “We’re very important,” he says, abandoning self-flagellation. “We help companies to grow by helping them to raise capital. Companies that grow create wealth. This, in turn, allows people to have jobs that create more growth and more wealth. It’s a virtuous cycle.” To drive home his point, he makes a remarkably bold claim. “We have a social purpose.”

Social purpose? Those who have lost their jobs or seen their pay slashed thanks to bankers who flogged dodgy mortgages and dreamt up investments so complex not even they understood them, would gladly tell him where to stick his social purpose…

This piece goes on for 7 web pages and gets deep into the secretive Goldman Sach spider web and its political force, so it’s worth taking your time to rummage through it all.

Meanwhile, over at one of my favorite sites, Chris Martenson has been doing some analysis in a piece out on 11/6/200 titled “Market Recap – Ridiculous Productivity“. The start of the piece takes a look at Goldman Sach’s pattern of amazing level of investment success in the current financial markets (italics mine). (And, just for the record, Goldman Sachs profit last quarter was $3.2 billion and the average pay of the 30,000 on staff is going to be around $700,000 this year with top earners making LOTS more…)

After digging around and sifting through the things both said and not said, I have come to the conclusion that what we are seeing are the likely effects of a rescue operation.

By this I mean a large injection of stabilizing cash to one or more parties, possibly related to the recent large bankruptcies.  Two of my friends, who have been actively trading for more than 20 years between them, threw in the towel this week, as their patterns and methods are no longer working.

Their conclusion is the same as mine; this market is not trading like it used to.  It is trading chaotically, counterintuitively, and as if there’s some sort of distorting influence involved.

First, we might just wonder if this isn’t the impact of a rogue firm with entirely too much power moving the market for its own benefit.

When we examine the results of Goldman’s latest quarterly trading results, obviously we have a strong suspect.

He quotes from a piece discussing how Goldman Benefits from Trading Bonanza and concludes:

Only one day with trading losses out of the entire quarter?  A 98.5% win-rate?  Sorry folks, this is so far beyond the realm of statistically possible that we must search for other reasons.  There can be no doubt that Goldman is enjoying an advantage not shared by the rest of the market.

He has a chart up which shows some of the shenaigans in the market following certain data reports.  But there’s one market move in particular that seems to have resulted from perhaps a bit of advance knowledge?

We see the volatility as the market first surged on the GDP report and then slumped the day after.  Then there was a spike on the ISM (mfg) data that also gave up the gains shortly thereafter.  Then we had the FOMC follies where the market looked like an EKG of a heart attack victim for a while before finally slumping away all the day’s gains.Today’s [Friday, November 6] 200 point Dow spree was said to be due to favorable unemployment data and excellent productivity gains, but if you were watching the overnight futures, you noticed that the lift-off actually began at 3:00 a.m.  As a trader, I am quite familiar with this pattern.  When large futures gains are recorded beginning at 3:00, you can nearly always count on those gains holding through the day.

Inquiring minds would like to know how the future traders seemingly know about the excellent economic news that has not yet been released.  Hello, SEC?  I have a job for you.

Well, apparently, part of doing God’s work involves getting a nice leg-up so that markets can move in miraculous ways.

It’s clear that while Goldman Sachs is apparently the OTHER “chosen one” (with Barack Obama the one placed in the White House), the rest of us who are trying to restore our personal wealth so that we’ll be able to eat during our golden years are plainly stuck somewhere near hell…

The Financial Filter: How CNBC Handles Howard Dean vs. Susan Boyle

~~By  InsightAnalytical-GRL

Lately, I’ve been testing my mettle by actually tuning into CNBC occasionally. We don’t have FOX Business here, but you get enough of their angle on the regular FOX shows featuring Neil Cavuto and the weekend financial panels.

Yesterday, I caught Howard Dean just around the Noon hour ET (on Power Lunch), slugging it out with that panel they have which features Larry Kudlow among others.  I was wondering what Dean was doing on there following the latest Geithner comments, but perhaps he’s getting warmed up to defend the upcoming healthcare “reform” that will be vomited out of the Congress and Obamaville soon.

Anyway, Kudlow was yelling again about “why can’t the markets be allowed to correct themselves” to which Dean retorted in perfect Obot fashion “Look what the markets did to the American people!” (sic).

Well, I waited for the comeback…I waited to hear one of these panel people, including Kudlow, respond snappily with how Congress, particularly Democratic members, failed to provide oversight over the housing mortgage debacle, which seems to have precipitated much of the mess we’re in.

CRICKETS!

But, as I thought about it, I figured that’s exactly what I was expected to hear. The GE family of companies that “bring good things to life” don’t consider history and full debate healthy for the 5th-grade level critical skills level of the American viewer. Kudlow is probably under orders “not to go there,” so he doesn’t go there. He’s loud and passionate about “the markets” but he pulled up short with Dean.

But that’s the way it is now. The media is in a permanent state of coitus interruptus when in it comes to discussing financial matters…or most political news. Especially since the Obama folks are so cozy with GE…

Sue Herera and Bill Griffeth, still at it after all these years,  are stuck in the middle of all this.  They’ll get a couple of people on and ask some serious questions, but the upcoming segments which follow always involve some provocative pugilism.  After listening to the Dean segment, which included another guest plus Dean and the four CNBC panelists,  I felt whiplashed, not informed. Mission accomplished!

After 3 PM, we get a lot more sober discussion for a brief time as The Closing Bell airs and things settle down.   Gone is the screaming on the panels and the minute-by-minute, breathless spewing that sounds like the coverage of a sporting event while the market gyrates. Maria Bartiromo anchors and does interviews and the discussions are less hysterical. Today, I caught a young guy from the NY Times and a few experienced hands getting down to the real problems with the financial sector…including the one-time things done this quarter courtesy government largesse that won’t be around to play with over the next few quarters when the rubber meets the road.

Yeah, but then it’s over as we get Fast Money then Jim Cramer’s Mad Money to liven the pace for evening prime time with their gameshow approach to finance and to appeal to the young dreamers who want to get rich quick and don’t have a clue. And then Kudlow returns.

In a comment to yesterday’s post, Lee M. had a musing which captures the zeitgeist of CNBC these days, too…I’ve done some word substitutions where appropriate:

…the cretins over at MSNBC CNBC, having crossed the Rubicon, have no where else to go.

They know that those of us who value our Constitution [journalistic integrity] have written them off, so they keep pitching their wares to the far left and the Obots because without them they would have no audience at all.

Like Julius Caesar before them, the die is cast, and they can’t go back. So they will continue their vile jokes [obvious bias and omissions] that would have gotten anyone else censored [fired] before this. They are tolerated because that is the way TPTB want it for now.

So Howard Dean is treated with kid gloves, the facts be damned!

Oh, but the folks at CNBC certainly DO have somewhere to go, if I may quibble a bit with that first line of the above comment. Where? Well, let’s visit the CNBC website where yesterday afternoon I found somebody dragging Susan Boyle along in a “humor” piece that ties the global economy to her performance…with an odd mixture of  admiration (?) and the requisite mockery (of course).  How appropriate…the taunts begin the day after I write about “Smeargate” in the UK and the level of “discourse”  we have here in the U.S.:

Apr.21

1:49 PM ET

As she concluded the song and the crowd jumped to its feet cheering, Susan Boyle blew a kiss. A kiss that, like the butterfly that flapped its wings, set in motion a flutter of dollars, pounds, euros and yen that will get this global economy humming again.

Will YouTube Sensation Susan Boyle Save the Global Economy?

Posted By:Cindy Perman

As the world grapples with headlines about troubled loans at Bank of America [BAC 8.76 +  0.74 (+9.23%)
and pirates wreaking havoc on the high seas, a lone dove has emerged to save the global economy.

SNIP

Boyle rolls her unknown-to-man hips.

Teenage girls roll their eyes. (Yeah, we saw you, eye-rolling girl at 1:24)

SNIP

Susan Boyle has given people a reason to hope.

A reason to look up from their flaming 401(k) statements.

I dreamed a dream in time gone by

A reason to walk over to their computer and log on to YouTube.com.

When hope was high

A reason to buy Kleenex in bulk at Costco. [COST 46.48 + 2.14 (+4.83%) ]

And life worth living

A reason to go to Amazon.com [AMZN 78.75 + 1.18 (+1.52%) ]

I dreamed that love would never die—

SNIP

I dreamed that God would be forgiving

A reason to watch the made-for-TV movie about her on Lifetime and expose themselves to millions of dollars in advertising. [DIS 19.47 + 0.06 (+0.31%) ]

Do you get the feeling that someone RESENTS the fact that Susan Boyle wasn’t manufactured by the entertainment industry and the mass media, but simply appeared and touched people’s souls without a filter? If the “money machine” were cranking up for one of their fake creations, would you get the slights and mockery that we see directed at Susan Boyle in this piece? Or the cheapening of a great performance (and a pretty darned good song, too) ? The vultures find it so distasteful that the the plebes responded spontaneously even though the entertainment biz types will be trying to make money off  her until the well runs dry?  Personally, I hope she makes a bundle on her own terms and then walks away…before we start getting the “whispers” about her single life that will probably be started up to shove her aside for some plastic doll that can be marketed and controlled for public consumption… Like, what? She doesn’t deserve to make any money off her REAL talent??  Mark my words, Simon Cowell will look like a compassionate saint compared to what could come down further along this road…

Yes, just like the filtering of political and financial news, we have to get a filter in place for Susan Boyle so the public can be redirected to enable the opinion/money makers can move onto creating a fab NEW item for which they can take full credit and reward themselves with extra executive compensation bonuses.  Maybe TPTB can recycle the filters they used with Sarah Palin, Hillary Clinton and a “feeble” John McCain as they deal with Susan Boyle.

Heart seems to have a short shelf-life these days…