Daily Archives: April 19, 2010 @ 3:14 pm (Monday)

SEC Said to Vote 3-2 to Sue Goldman Sachs Over CDO

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With this vote along party lines Dems will look very bad if they don’t win it.

>   
>   (email exchange)
>   
>   On Mon, Apr 19, 2010 at 2:37 PM, wrote:
>   
>   the vote was close but I’m not sure it changes much. However the political angle
>   in light of the Administration’s efforts at financial reform cannot be avoided.
>   Government leverage vs. bank leverage…
>   

SEC Said to Vote 3-2 to Sue Goldman Sachs Over CDO Disclosures

By Jesse Westbrook

April 19 (Bloomberg) — The U.S. Securities and Exchange
Commission split 3-2 along party lines to approve an enforcement
case against Goldman Sachs Group Inc., according to two people
with knowledge of the vote.

SEC Chairman Mary Schapiro sided with Democrats Luis
Aguilar and Elisse Walter to approve the case, said the people,
who declined to be identified because the vote wasn’t public.
Republican commissioners Kathleen Casey and Troy Paredes voted
against suing, the person said.

The SEC on April 16 accused Goldman Sachs, the most
profitable company in Wall Street history, of creating and
selling collateralized debt obligations in 2007 tied to subprime
mortgages without disclosing that hedge fund Paulson & Co.
helped pick the underlying securities. Goldman Sachs also didn’t
disclose to investors that Paulson was betting against the
securities, the SEC said.

SEC spokesmen John Nester and Myron Marlin didn’t
immediately return a phone call and e-mail seeking comment.

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Counter Conference

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Background

Fiscal sustainability is very much in the News these days because of the activities of the President’s National Commission on Fiscal Responsibility and Reform, The Peterson Foundation’s very vigorous efforts to present a point of view on fiscal sustainability that reinforces and expands the outlook of the National Commission’s statement of purpose, The Washington Post’s continuing expression of the deficit hawkism point of view, and CNN’s “news alliance” with The Peterson Foundation. All this and more is part of a steamroller being formed to ensure that only one point of view on fiscal sustainability, namely a neo-liberal point of view dominates the landscape of public discussion.

When that sort of thing happens, as it did in the health care debate, the people suffer, because any policy, based on an alternative framing of the fiscal sustainability problem, is immediately off the table of policy consideration because it is outside the frame of “legitimate debate.” Let’s not let that happen with fiscal sustainability. Let’s keep a number of frames under consideration, so that we can consider all fiscal sustainability policies that might work. The test we use to determine whether a policy will work needs to be an evaluation of its consequences; not an evaluation of whether it’s outside a dominant frame of ideology. Continue reading →

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