The insiders at Goldman knew the crash was coming.
And saw it as an opportunity to make money hand-over-fist, and leave the taxpayer to bear the brunt of the losses, even as many of them were also losing their homes and jobs.
In 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers it was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting.
Goldman's sales and its clandestine wagers, completed at the brink of the housing market meltdown, enabled the nation's premier investment bank to pass most of its potential losses to others before a flood of mortgage defaults staggered the U.S. and global economies.
Only later did investors discover that what Goldman had promoted as triple-A rated investments were closer to junk.
(Those are just the opening paragraphs--the really bad stuff is buried down the article.)
All in a day's work. Crack dealer, investment banker, both selling poisonous products with high profit margins, and insulating themselves from having to see what their stuff does to the customer.
Problem is, this sort of behavior totally erodes any sense of trust in a culture.
It's difficult to have a culture once trust is eroded. Much less an economy.
But, then again, if they cared about the culture, they wouldn't have been selling this stuff in the first place, would they?
Culture shapes economy.
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