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Friday, December 09, 2011

How State Capitalist revolving door between Washington and Wall Street works: "public officials" provide private sector cronies inside information

Turns out the ‘Government Sachs’ conspiracy theorists were right all along

(Activist Post) -- by Madison Ruppert --

In a shocking article published in Reuters, Felix Salmon confirmed what the so-called conspiracy theorists have said all along: former Secretary of the U.S. Treasury Hank Paulson was giving insider tips to his cronies at Goldman Sachs and other Wall Street titans which directly benefited them.

The article is entitled, “Hank Paulson’s inside jobs,” emphasizing the fact that this wasn’t some one-off lapse of ethics on Paulson’s part, but instead a disturbingly regular practice.

For those who are unaware, Paulson was the CEO and chairman at Goldman Sachs from 1999-2006 and he clearly provided them with actionable information that epitomizes the plague upon our economy, and the greater global economic system, that is crony capitalism.

However, this isn’t quite a brand new revelation given the fact that in October of 2009 Andrew Ross Sorkin exposed that Paulson met with the entire Goldman Sachs board in a hotel suite in Moscow at the end of June 2008.

Salmon covered this at the time, after Sorkin’s book was released, which detailed the meeting held after the Goldman Sachs boys had dinner with Mikhail Gorbachev...

This wasn’t just a friend going over a speech with some old pals, as everyone knows the words of the Treasury Secretary heavily affect global markets almost instantly, just like speeches by the likes of Ben Shalom Bernanke, the Chairman of the Board of Governors of the private Federal Reserve.

Getting this kind of information ahead of time is critical, and through Sorkin’s writing it is clear that Paulson enlightened them as to the situation with Lehman Brothers, giving Goldman Sachs an unfair advantage over those who didn’t happen to have someone on the inside.

Paulson spoke of the possibility that Lehman Brothers very well might collapse, along with giving the Goldman Sachs board other insights into how he was viewing the economic climate and what was to come.

As Salmon points out, “Maybe it’s not so surprising that Goldman Sachs turned out to be so well positioned when Lehman did indeed [blow up] a few months later.”

This egregious breach of ethics is a perfect example of the corporatism that pervades Wall Street and has brought us to the brink of collapse where we are precariously perched today.

Paulson’s Moscow meeting with Goldman Sachs wasn’t an isolated incident as just a few weeks later on July 28th, 2008, Paulson met with what Salmon characterizes as “a who’s who of the hedge-fund world” in the Eton Park Capital Management headquarters.

Unsurprisingly, Eton Park Capital Management was created by Eric Mindich, formerly of Goldman Sachs as well.

In a Bloomberg article published yesterday, Richard Teitelbaum details the meeting between roughly a dozen hedge-fund managers and Wall Street executives, including no less than five former colleagues of Paulson’s from Goldman Sachs...MORE...LINK

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