Goldman Sachs Win Again
Discussion
From here:
Article said:
They've called it the $30bn speech - that's the value wiped off shares in top US companies in the minutes after President Obama announced on Thursday that he was to introduce measures to reduce the size of financial institutions and limit their ability to take on risk.
Almost without exception, big bank shares headed south on the news, with stock in Goldman falling some 8% Thursday and Friday. But Goldman staff are doubtless delighted at the effect Obama's statement had on the firm's shares, as the award price used for calculating the number of shares that go into individual bonus packages (as deferred equity) is thought to have been based on Friday's close. In other words, thanks to the President's obsession with bankers and their bonuses, Goldman staff will actually receive around 8% more stock in their bonus sacks than they would have before he opened his mouth. Such is The Law of Unintended Consequences.
This does of course assume that the shares rebound but still a great bit of timing!Almost without exception, big bank shares headed south on the news, with stock in Goldman falling some 8% Thursday and Friday. But Goldman staff are doubtless delighted at the effect Obama's statement had on the firm's shares, as the award price used for calculating the number of shares that go into individual bonus packages (as deferred equity) is thought to have been based on Friday's close. In other words, thanks to the President's obsession with bankers and their bonuses, Goldman staff will actually receive around 8% more stock in their bonus sacks than they would have before he opened his mouth. Such is The Law of Unintended Consequences.
theaxe said:
From here:
Obama is failing so badly on all fronts that the latest attempt at distraction is to take the "populist" stance against big business and evil capitalism.Article said:
They've called it the $30bn speech - that's the value wiped off shares in top US companies in the minutes after President Obama announced on Thursday that he was to introduce measures to reduce the size of financial institutions and limit their ability to take on risk.
Almost without exception, big bank shares headed south on the news, with stock in Goldman falling some 8% Thursday and Friday. But Goldman staff are doubtless delighted at the effect Obama's statement had on the firm's shares, as the award price used for calculating the number of shares that go into individual bonus packages (as deferred equity) is thought to have been based on Friday's close. In other words, thanks to the President's obsession with bankers and their bonuses, Goldman staff will actually receive around 8% more stock in their bonus sacks than they would have before he opened his mouth. Such is The Law of Unintended Consequences.
This does of course assume that the shares rebound but still a great bit of timing!Almost without exception, big bank shares headed south on the news, with stock in Goldman falling some 8% Thursday and Friday. But Goldman staff are doubtless delighted at the effect Obama's statement had on the firm's shares, as the award price used for calculating the number of shares that go into individual bonus packages (as deferred equity) is thought to have been based on Friday's close. In other words, thanks to the President's obsession with bankers and their bonuses, Goldman staff will actually receive around 8% more stock in their bonus sacks than they would have before he opened his mouth. Such is The Law of Unintended Consequences.
zac510 said:
I don't understand how the GS staff are benefitting. Are they getting more volume of shares because the value of them are less (ie the same $ amount of shares) hence will profit more if the shares return to pre-speech level?
Yeah, they get more shares because of the cheaper price. The assumption that the article makes is that they'll bounce back to some 'normal' level. It hasn't happened yet.Jimbeaux said:
theaxe said:
From here:
Obama is failing so badly on all fronts that the latest attempt at distraction is to take the "populist" stance against big business and evil capitalism.Article said:
They've called it the $30bn speech - that's the value wiped off shares in top US companies in the minutes after President Obama announced on Thursday that he was to introduce measures to reduce the size of financial institutions and limit their ability to take on risk.
Almost without exception, big bank shares headed south on the news, with stock in Goldman falling some 8% Thursday and Friday. But Goldman staff are doubtless delighted at the effect Obama's statement had on the firm's shares, as the award price used for calculating the number of shares that go into individual bonus packages (as deferred equity) is thought to have been based on Friday's close. In other words, thanks to the President's obsession with bankers and their bonuses, Goldman staff will actually receive around 8% more stock in their bonus sacks than they would have before he opened his mouth. Such is The Law of Unintended Consequences.
This does of course assume that the shares rebound but still a great bit of timing!Almost without exception, big bank shares headed south on the news, with stock in Goldman falling some 8% Thursday and Friday. But Goldman staff are doubtless delighted at the effect Obama's statement had on the firm's shares, as the award price used for calculating the number of shares that go into individual bonus packages (as deferred equity) is thought to have been based on Friday's close. In other words, thanks to the President's obsession with bankers and their bonuses, Goldman staff will actually receive around 8% more stock in their bonus sacks than they would have before he opened his mouth. Such is The Law of Unintended Consequences.
chippy17 said:
was Golman bailed out?
Back in the '90s and through the mid-'00s, major figures from Goldman Sachs such as Robert Rubin, Gary Gensler and Hank Paulson stood fast against derivatives regulation (Rubin and Gensler) and lobbied successfully for higher leverage ratios so they could bet more of their capital on the market boom (Paulson). When those policies came to grief and Wall Street imploded, and the Feds scrambled to rescue stricken insurance giant AIG, Goldman CEO Lloyd Blankfein was reportedly the only bank executive invited to an emergency meeting at the New York Federal Reserve (convened by then-Fed president Tim Geithner).Now Treasury Secretary Geithner—a Rubin protégé, of course—has assigned two more ex-Goldman men to fix the vast mess their colleagues helped to create.
http://www.newsweek.com/id/187705
Fittster said:
Jimbeaux said:
Obama is failing so badly on all fronts that the latest attempt at distraction is to take the "populist" stance against big business and evil capitalism.
Do you think Paul Volcker is wrong on the subject of the banks and is giving incorrect advice to Obama?fido said:
Fittster said:
Jimbeaux said:
Obama is failing so badly on all fronts that the latest attempt at distraction is to take the "populist" stance against big business and evil capitalism.
Do you think Paul Volcker is wrong on the subject of the banks and is giving incorrect advice to Obama?Paul Volcker is one of the most respected central bankers alive today and all his statements suggest that he think the action of investment banks need to be reformed. It is far easier to attack Obama than Paul Volcker.
But Volcker, who tamed soaring inflation in the 1980s, had pleaded in vain for months for government action to stop commercial banks from engaging in so-called "prop trading."
In an interview published Friday on a Wall Street Journal blog, Volcker said he was not surprised by the president's choice.
"We've discussed this proposal for a year," Volcker said, adding that he always believed that Obama was "sympathetic" to his point of view, the online article said.
Volcker is seeking a new version of the law but, until just recently, he had seemed to be a voice in the desert facing countervailing winds from Summers, his former protege, Treasury Secretary Timothy Geithner, and other Obama economic counselors.
The New York Times article highlighted that Volcker's "disagreement with the Obama people on whether to restore some version of Glass-Steagall appears to have contributed to published reports that his influence in the administration is fading and that he is rarely if ever in the small Washington office assigned to him."
As recently as a few weeks ago, Volcker said in a BusinessWeek interview: "The president has heard my arguments a number of times" but he added: "I am one voice in the conversation, and there are others."
Ultimately, he told the magazine, "He's the president. He decides."
Obama finally listened.
Some observers, like economist Peter Morici, a University of Maryland professor, said that Obama's change of heart appeared to occur amid falling public approval ratings as Americans grow more critical about his handling of economic policy.
source
Fittster said:
chippy17 said:
was Golman bailed out?
Back in the '90s and through the mid-'00s, major figures from Goldman Sachs such as Robert Rubin, Gary Gensler and Hank Paulson stood fast against derivatives regulation (Rubin and Gensler) and lobbied successfully for higher leverage ratios so they could bet more of their capital on the market boom (Paulson). When those policies came to grief and Wall Street imploded, and the Feds scrambled to rescue stricken insurance giant AIG, Goldman CEO Lloyd Blankfein was reportedly the only bank executive invited to an emergency meeting at the New York Federal Reserve (convened by then-Fed president Tim Geithner).Now Treasury Secretary Geithner—a Rubin protégé, of course—has assigned two more ex-Goldman men to fix the vast mess their colleagues helped to create.
http://www.newsweek.com/id/187705
Fittster said:
Jimbeaux said:
theaxe said:
From here:
Obama is failing so badly on all fronts that the latest attempt at distraction is to take the "populist" stance against big business and evil capitalism.Article said:
They've called it the $30bn speech - that's the value wiped off shares in top US companies in the minutes after President Obama announced on Thursday that he was to introduce measures to reduce the size of financial institutions and limit their ability to take on risk.
Almost without exception, big bank shares headed south on the news, with stock in Goldman falling some 8% Thursday and Friday. But Goldman staff are doubtless delighted at the effect Obama's statement had on the firm's shares, as the award price used for calculating the number of shares that go into individual bonus packages (as deferred equity) is thought to have been based on Friday's close. In other words, thanks to the President's obsession with bankers and their bonuses, Goldman staff will actually receive around 8% more stock in their bonus sacks than they would have before he opened his mouth. Such is The Law of Unintended Consequences.
This does of course assume that the shares rebound but still a great bit of timing!Almost without exception, big bank shares headed south on the news, with stock in Goldman falling some 8% Thursday and Friday. But Goldman staff are doubtless delighted at the effect Obama's statement had on the firm's shares, as the award price used for calculating the number of shares that go into individual bonus packages (as deferred equity) is thought to have been based on Friday's close. In other words, thanks to the President's obsession with bankers and their bonuses, Goldman staff will actually receive around 8% more stock in their bonus sacks than they would have before he opened his mouth. Such is The Law of Unintended Consequences.
chippy17 said:
Fittster said:
chippy17 said:
was Golman bailed out?
Back in the '90s and through the mid-'00s, major figures from Goldman Sachs such as Robert Rubin, Gary Gensler and Hank Paulson stood fast against derivatives regulation (Rubin and Gensler) and lobbied successfully for higher leverage ratios so they could bet more of their capital on the market boom (Paulson). When those policies came to grief and Wall Street imploded, and the Feds scrambled to rescue stricken insurance giant AIG, Goldman CEO Lloyd Blankfein was reportedly the only bank executive invited to an emergency meeting at the New York Federal Reserve (convened by then-Fed president Tim Geithner).Now Treasury Secretary Geithner—a Rubin protégé, of course—has assigned two more ex-Goldman men to fix the vast mess their colleagues helped to create.
http://www.newsweek.com/id/187705
Blue Meanie said:
Just curious, but if you are going to give Obama credit for this massive drop, are you also going to give him credit for the largest stock market gain in a Presidents 1st year since before WWII?
If you are addressing me, of course, let him have the credit. He can put that in his one page book of accomplishments in 2012 back in Chicago. Mervyn King told MPs on the House of Commons Treasury Select Committee that for Britain to house a banking system that is “five times GDP” and reliant on the taxpayer for support is “simply not credible”.
Giving evidence on the debate over whether banks should be allowed to be “too big to fail”, Mr King strongly suggested that Britain should follow the radical overhaul of the banking system announced by President Obama last week.
http://www.telegraph.co.uk/finance/financetopics/f...
So it isn't just a bunch of lefties who hate banks calling for reform.
Giving evidence on the debate over whether banks should be allowed to be “too big to fail”, Mr King strongly suggested that Britain should follow the radical overhaul of the banking system announced by President Obama last week.
http://www.telegraph.co.uk/finance/financetopics/f...
So it isn't just a bunch of lefties who hate banks calling for reform.
Jimbeaux said:
Blue Meanie said:
Just curious, but if you are going to give Obama credit for this massive drop, are you also going to give him credit for the largest stock market gain in a Presidents 1st year since before WWII?
If you are addressing me, of course, let him have the credit. He can put that in his one page book of accomplishments in 2012 back in Chicago. Fittster said:
chippy17 said:
Fittster said:
chippy17 said:
was Golman bailed out?
Back in the '90s and through the mid-'00s, major figures from Goldman Sachs such as Robert Rubin, Gary Gensler and Hank Paulson stood fast against derivatives regulation (Rubin and Gensler) and lobbied successfully for higher leverage ratios so they could bet more of their capital on the market boom (Paulson). When those policies came to grief and Wall Street imploded, and the Feds scrambled to rescue stricken insurance giant AIG, Goldman CEO Lloyd Blankfein was reportedly the only bank executive invited to an emergency meeting at the New York Federal Reserve (convened by then-Fed president Tim Geithner).Now Treasury Secretary Geithner—a Rubin protégé, of course—has assigned two more ex-Goldman men to fix the vast mess their colleagues helped to create.
http://www.newsweek.com/id/187705
so strictly speaking they never got 'bailed out' as it were
Gassing Station | News, Politics & Economics | Top of Page | What's New | My Stuff