Greg Smith Isn't The Only One Who Testifies To The Rot At Goldman-Sachs

Wallace Turbeville, whose tenure as a VP at G-S predates Smith, gives testimony as well.

From The American Spectator:

Having spent 12 years at Goldman prior to 1997, I sympathize with Smith’s feelings of loss and betrayal. I left just at the beginning of the institution’s evolution into its current form and have observed the process with despair—not only for the organization but for the loss suffered by the nation.

He speaks with respect and fondness of his earlier days there, and with despair at what followed.

The world shifted. Trading exploded, largely fueled by information technology. It seemed that every number on earth could be divided by every other number, all in real time. Everything could be priced, and, once priced, could be traded. Markets were deregulated and carved into pieces, each representing a trading opportunity. The Wall Street firms, and Goldman in particular, with their enormous capital resources, could dominate more and more of the price points in the American economy, extracting value from the producers and consumers. Software programs could be written to access electronic trading platforms so that the enormous force of the trading houses could be brought to bear without the inefficiency of human intervention. It seemed that a business model relying on dispassionate exploitation of immediate opportunity had been perfected.

The golden rule kicked in—“He who has the gold makes the rules.” The predominance of trading profits reversed the balance of influence in favor of the traders. Clients were no longer just clients; instead, they were counterparties to be dealt with at arm’s length. In the end, the traders achieved Nirvana—using asset pools, they were able to synthesize their own clients as sources of securities to trade. The business of trading, focused on short-term profits, became dominant at Goldman Sachs, and every firm on Wall Street tried to emulate it.

There is more here, much more. It presents a problem for G-S, because it affirms what they loudly deny: They have been playing the ends against the middle, shamelessly.

Our culture has been gutted, not only because of these people, but they certainly have encouraged the process along.

Our Saviour's haunting question lingers in the air:  

What doth it profit a man if he gain the whole world and lose his own soul?

And, in that loss of the soul, what happens to the world you attempt to gain? Will it be worth the energy spent in the acquisition?

This story is just beginning to ramp up, ya'll. Don't listen to the noise the PR shills will be creating. Look at what has happened in your own homes and businesses and in the places you live, to your friends and family, your city and county, and your country.

Christopher Tappin Update

He was denied bail--surprise, surprise.

All that evidence the US Justice Department should have been required to disclose to a British judge in order to obtain a legal extradition was presented in court in El Paso, complete with much bluster from the prosecutor--who knows he damned well better win if he doesn't wish to spend the rest of his career defending DUI's in some county in New Mexico.

He is considered a dangerous man, a flight risk, an evil-doer. Therefore, he is in jail, being slowly broken down in the attempt to extort a guilty plea.

Really? Perhaps the US government does not want this man on the street because he has a story to relate about the behavior of the US government--the one that used him as an informant (a reliable, upstanding informant) in order to obtain a conviction in another case. 

So, boyz--which is it?  This from the Forbes article listed above:

Simultaneously, the U.S. government is citing Tappin for his valuable cooperation in a federal crime (Sky), while at the same time claiming that he is involved in activities of shipping military goods to Iran. So which is Tappin, friend or foe?...or both?

Again, OS won't judge one way or another regarding Mr. Tappin's guilt or innocence--who can say from this distance?

But we know this about the US federal government: It sold missile batteries to the Iranians, then later set up a dummy company to see if it couldn't entrap people supposedly aiming to sell electric batteries for the missiles it had sold the Iranians. (Following this so far?) It managed to entrap a UK citizen, and force him to roll over, which he did not do--likely because he may well be innocent. Remember the concept of 'innocent until proven guilty'? Then it decided to make him An Object Lesson, and trampled on both UK law, treaty law, and US law to haul him out retirement, stick his ass in a south Texas jail, where he had to request solitary confinement for his own safety. He's not allowed even a book, and the light never goes off. Once he becomes borderline suicidal, they'll offer him a 'deal'. Otherwise, they'll just let him die in jail, forever silenced.

OS does not care whether Mr. Tappin is guilty or innocent of the charges. He is no threat to our safety whatsoever, compared to a US government that has decided it is the law, and our lives are subject to being ground up in its maw at any moment.

David Cameron's complicity with the US government is tragically shameful. Words fail to describe a man who happily scarfs down hot dogs at a basketball game in Ohio (which event, by the way, set the taxpayers back several million borrowed dollars) and lets his countryman rot in a Texas jail. By the way, Obama still plans to throw the people of the Falklands to the Argentine wolves. Enjoy that hot dog, Dave--that picture will circulate and circulate and circulate at your next election.

People such as this are capable of anything.

NCAA Tourney: UNC Asheville v Syracuse, And The Erosion Of Credibility

It was exciting to see UNC Asheville hustle and keep things close with Syracuse, truly one of those games that everyone can enjoy.

Then, it became obvious that the outcome had been decided in the referees' locker room before the game began: No matter how ugly, Syracuse must win. Too much money on the line, too many viewers in those 'large-market' slices of the TV audience. The western bits of North Carolina don't have enough people to begin to make up for the losses of market share if upstate New York switches off the tube.

The goal-tend call that wasn't, the lane violation that maybe occurred but would have never been called unless the refs needed a way to turn the tide, and then the obvious blatant missed call of the out-of-bounds handed to Syracuse. Followed by CBS spinning and spinning, trying to tell us we and the entire crowd didn't see what we actually saw, followed by John Adams of the NCAA officiating office magically on hand to tell we didn't see what we saw--after all these are great guys doing a great job under tough circumstances and nobody dare question our competence much less our integrity. Talk talk talk spin spin spin.

It is becoming endemic, and OS has refrained from writing on it, thinking perhaps he was simply not seeing what he was seeing up to this point. But now, it has become blatant, shameless, unapologetic.
The Final Four must include at least two top seeds from large markets, no matter how ugly the process.

In 2010, OS noted the shameful conclusion of the PGA Championship, where he noted that professional golf had that day become just another professional sport, where officials decided who they wished to win. That day has long come and gone for the NCAA.

In our culture, since about the late 1960's, almost all trust has eroded. Sports matter a lot to people, because it gives respite from the greyness of so many lives, and there is that knowledge that a Tom Watson will penalize himself a stroke for an inadvertent infraction; that even though everyone is human, balls are balls and strikes are strikes; that players will refrain from the temptation to deliberately injure one another; that officials will let the game unfold and not attempt to enter into it.

This is all going away in the NCAA. Someone will end up getting badly injured in a game this March, OS fears, and the NCAA will not have enough credibility to handle the situation, OS knows.

The Spinnnnnnnnn Beginnnnnnnns For The Vampire Squid Team

And, boy oh boy, it's gunna take some real spinning to get past Greg Smith's tightly-written and horribly damning account of his reasons for his departure from G-S.

For those who haven't taken the time to read it--this is as good a time as any.

The first salvo appeared in the WSJ, a memo ostensibly written by Lloyd Blankfein (suuuuuuure-he-wrote-it-honest-injun!) which circulated to the employees.

Needless to say, we were disappointed to read the assertions made by this individual that do not reflect our values, our culture and how the vast majority of people at Goldman Sachs think about the firm and the work it does on behalf of our clients.

In a company of our size, it is not shocking that some people could feel disgruntled.  But that does not and should not represent our firm of more than 30,000 people. Everyone is entitled to his or her opinion.  But, it is unfortunate that an individual opinion about Goldman Sachs is amplified in a newspaper and speaks louder than the regular, detailed and intensive feedback you have provided the firm and independent, public surveys of workplace environments.

In other words: He's just a disgruntled little fish in our big ocean here, never amounted to much, never will. Every time we come 'round and ask ya'll if ya'll are happy, ya'll all say 'Why, sho' nuf Massah Blankfein, we all jest luuuuuuuves working fer you heah at Goldman-Sachs.' That's good enough for us, so get back to work and rape more muppets--I mean clients--this week. Churn out those bond issues you know belong on the toilet paper rolls in the basement lavatories. Flip those stocks, churn those derivatives. Remember above all our motto--IBG/YBG--I be gone, you be gone, long before the muppets--I mean clients--understand how we raped them.'

There is a problem with that approach: Greg was not that small a fish, matter of fact he was very much on the rise and on the inside. His essay makes that clear. His essay makes a lot of things clear, but mainly all those voices that have been screaming that G-S is a corrupt enterprise have been telling the truth.

The attacks on Smith begin in earnest tomorrow. He may need a bodyguard, and he will find out just how completely bought-off both the US and UK governments are. His family, out to the second cousins, will be terrorized. He will be made An Example, An Object Lesson--don't mess with us boy. It would be a shame if your little five-year-old nephew were to end up in some sort of terrible accident, wouldn't it?

When the noise begins in earnest, OS hopes his readers will not be distracted by it.

'Get The Culture Right Again': Greg Smith's Final Words Upon Departing Goldman-Sachs

(HT Jesse, who has an uncanny ability to shuffle through millions of words to find the best ones to share.)

This sort of little announcement usually means little to the outside world:

Greg Smith is resigning today as a Goldman Sachs executive director and head of the firm’s United States equity derivatives business in Europe, the Middle East and Africa.

OK, another banker/broker type has made his wad by making great deals from which he made profits, and he's off to do other things with his wealth that interest him more.

No biggie, happens every month somewhere.


This little announcement is different, because it is attached to Mr. Smith's Op-Ed piece in the YewNorkTimez, announcing the reasons for his departure. It is a wonderful thing to read, in no small part because Mr. Smith tells us in tones loud and clear that Culture Shapes Economy Before Economy Shapes Culture, which is what OS has been saying alllllll along.

Every paragraph is pithy, and the article is pre-loaded to blow up in the faces of the G-S PR hacks who will go to great lengths to destroy his reputation. (OS assumes Mr Smith has great lawyers to protect him when G-S calls in its favors to the SEC and Justice Department to have him prosecuted and sued for his public departure. The Corleones used the garotte and decapitated heads of favorite horses. Our modern-day Corleones use the bought-and-paid-for government.)

One of the best portions--it is difficult to choose--is this:

It makes me ill how callously people talk about ripping their clients off. Over the last 12 months I have seen five different managing directors refer to their own clients as “muppets,” sometimes over internal e-mail. Even after the S.E.C., Fabulous Fab, Abacus, God’s work, Carl Levin, Vampire Squids? No humility? I mean, come on. Integrity? It is eroding. I don’t know of any illegal behavior, but will people push the envelope and pitch lucrative and complicated products to clients even if they are not the simplest investments or the ones most directly aligned with the client’s goals? Absolutely. Every day, in fact.

It astounds me how little senior management gets a basic truth: If clients don’t trust you they will eventually stop doing business with you. It doesn’t matter how smart you are.

Mr. Smith writes of humility, integrity, working for the best interest of the client, respect, work ethic--all the hallmarks that make a great business, a great family, a great house of worship, a great city, a great country. When those things go away, it is only. a. matter. of. time. before things cave in upon themselves.

So, thanks to Mr. Smith. He will undoubtedly go through the swamp full of alligators and sewage once this article gets around, and OS assumes he has a book deal in place, for which this essay was a teaser. If not, he'll have one by the end of April. OS hopes he carefully tucked plenty of very damning evidence away in his briefcase for these past several years. One always needs a bit of leverage in dealing with sociopaths--they respond only to the prospect of gaining more money or power, or to the fear of exposure and humiliation. An appeal to ethics or any greater good simply does not register anywhere within what little may remain of their souls.

Three Minutes Of Inspiration From Count Basie

Shared by one of OS's friends and colleagues.

Basie's band always played well, but sometimes all the planets aligned, the clouds parted, and the divine made a brief visit, just to remind us all of what might yet be possible.

A simple blues riff song, yet drummer Harold Jones and the entire band seemed to absolutely think as one.

OS hopes ya'll enjoy it, and share it along to cheer the world a bit.

DanHan: Comes A Point When You Run Out Of Track...

OS watched in horror a few years ago as Clarkson and the boys undertook their ill-advised journey through Florida, across the Gulf Coast, terminating their travels in NawLeenz. It got so ugly, so quickly.

There was, however, a truly funny moment when the boys were told they were to engage in the classic timed quarter-mile straight sprint in their junker cars, on a track that was only a quarter-mile plus about fifty yards. At yard fifty-one lay the ditch full of alligators.

Fahr-'em-up boyz!! And off they went, with brakes that were definitely not up to the task. No one was injured, blessedly, but things ended badly for one of the cars, if memory serves.

This episode is not unlike what we now see happening in both the United States and Europe. February 2012 was the highest monthly deficit this nation has ever recorded, in over two hundred years since the Constitution was ratified. The Senate will not pass a budget. The White House is a runaway freight train.

This can only end badly, and OS, in his darker moments, wonders if perhaps folks in the White House have some sort of train-over-the-cliff moment in mind for us all. It explains their behavior, when nothing else will.

Meanwhile, DanHan (as always) states the case succinctly. OS does wish we could lease this gent for a couple of decades. Sort of a reverse Lend-Lease back to Great Britain. We'll even give them Puerto Rico in the bargain, since we took some islands from them in the 1940's.

Chicago NorthSide Riot Reported--Near Wrigley Field

You can read and follow the trail here.

For those not too familiar with Chicago, the area around Wrigley Field, home field of the beloved (and usually inept) Cubs, is a very nice part of the city. The SouthSide, where the White Sox play, has always been a gritty part of the world. Group muggings and street violence just aren't part of life up in Wrigleyville.

Things are becoming increasingly unglued in Chicago, ya'll.

OS shares this, just to remind one and all that this is Obama's city and state,  run by his former campaign manager and chief of staff.

This is a city that has been in the hands of Obama's political ancestors and current chums for decades.

This is the future that awaits the country, if it is left in their hands.