If you’ve been reading my blogs, you know I am convinced the financial collapse of 2008 and the subsequent bank bailout was an elaborate scheme to defraud investors and taxpayers. And you know I predicted that people would go to prison as a result.
And if you’ve been reading the news you know financial giant Goldman Sachs was accused Friday of committing fraud by selling investors securities they knew would fail. The immediate losers were pension funds, foreign firms and private investors, who were taken for more than $1 billion.
According to a civil suit filed by the Securities and Exchange Commission, the winners include a wheeler-dealer named John Paulson (no, he’s not related to former Treasury Secretary Hank Paulson but I wouldn’t be surprised if they’re connected somehow). Paulson (photo above) allegedly raked in a cool billion dollars by setting up a deal in which he paid Goldman Sachs to create and promote mortgage based bonds that were designed to fail. His profit came from insuring the bonds against failure (through credit default swaps).
His firm reportedly made $15 billion in 2007 by betting that Americans would default in droves on their home loans.
You may also have read that Wall Street analysts say the suit against Goldman Sachs is just the beginning as federal regulators and investigators comb through the wreckage of the financial disaster. There are undoubtedly many more charges to come.
In view of these eye-opening developments, you might be surprised to learn that all 41 Republicans in the U.S. Senate have announced – as a group – they will oppose legislation to clean up the finance industry. You would think even those banker-backed Republicans would recognize that if something isn’t done it’s only a matter of time before Wall Street con artists pull off another monstrous heist.
The Republican senators have come up with elaborate reasons for their astonishing opposition to reform. And, as is now their custom, the reasons are riddled with half-truths, buzz words, “talking points” and downright lies.
Obviously, they believe a sucker is born every minute. But – after being robbed of billions (perhaps trillions) by the Republican abetted banking industry – even the American public should be smart enough to see through the scam this time.