Only Paul Krugman could do what he's done this morning, and that's absolutely, positively ream the total crap out of Goldman-Sachs for frontrunning America, in: "
Rewarding Bad Actors."
(Yes, there is a god!)
What a wonderful way to start the week on Wall Street (IMHO). And, on top of that, the guy also goes to town on Citigroup for speculating in the commodities markets, particularly with regard to crude oil.
Rewarding Bad Actors
New York Times
By PAUL KRUGMAN
Published Online: August 2, 2009 In Print: August 3, 2009
Americans are angry at Wall Street, and rightly so. First the financial industry plunged us into economic crisis, then it was bailed out at taxpayer expense. And now, with the economy still deeply depressed, the industry is paying itself gigantic bonuses. If you aren't outraged, you haven't been paying attention.
And they're still at it. Consider two recent news stories.
One involves the rise of high-speed trading: some institutions, including Goldman Sachs, have been using superfast computers to get the jump on other investors, buying or selling stocks a tiny fraction of a second before anyone else can react. Profits from high-frequency trading are one reason Goldman is earning record profits and likely to pay record bonuses.
On a seemingly different front, Sunday's Times reported on the case of Andrew J. Hall, who leads an arm of Citigroup that speculates on oil and other commodities. His operation has made a lot of money recently, and according to his contract Mr. Hall is owed $100 million.
--SNIP--
....What they do is bad for America...
Krugman makes quite the point of telling us that "...speculation can serve a useful purpose."
But, he notes it's when Wall Street speculates on information that's not available to the general public which is where the train goes off the tracks.
He paints a picture that tells us that the actions of Goldman and Citi are actually harmful to the public, at large. And, I couldn't agree more! He comes right out and says this about Goldman's actions: "...it has a negative effect on national wealth."
Lastly, we have this gem...
Neither the administration, nor our political system in general, is ready to face up to the fact that we've become a society in which the big bucks go to bad actors, a society that lavishly rewards those who make us poorer.
If you'd like to read more about Goldman's high-frequency trading misadventures and/or their dalliances in crude oil speculation--both matters which have cost the American public dearly--checkout the Zero Hedge blog, or my numerous diaries on both of these travesties over the past month.
Thanks Professor Krugman...you just made my night! And, Goldman, I'd say you now have a bonafide, major public relations problem.
Yes, the volume intensifies...turn it up, people!