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SEC vs. Goldman Sachs

Prediction: Under the law, Goldman wins. SEC has no case.
For public consumption: They’ll call it a draw so the government can make a statement.

Issue #1: Goldman sold securities, and somebody lost a billion dollars.
Answer: That’s what happens every second in the world markets. Two sophisticated players wanted to put up big money, betting the opposite way on the housing market. Goldman Sachs arranged the wager. Guess what? Somebody was going to lose, and everybody knew it.

Issue #2: Goldman didn’t reveal the counter party.
Answer: Goldman is not allowed to reveal who takes the other side of a transaction.

My Question: So what’s the real reason the government is making a stink?

Posted in Financial Markets, Political Commentary.

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