Goldman Sachs bets credit crisis will worsen

Source: The Independent

Goldman Sachs, the feted investment bank and the only major Wall Street firm to have avoided giant losses from the credit crisis, is betting that the chaos in the American mortgage market will continue to get worse.

As some of the finance industry's most powerful executives gathered for an industry conference in Manhattan, Lloyd Blankfein, the chief executive of Goldman Sachs, said his firm was still holding to its lucrative bets that the value of mortgage-backed securities will fall.

And at the same conference, an executive from its smaller rival Bank of America announced that it would probably be writing down the value of its mortgage portfolio by a further $3bn (£1.45bn) at the end of the year.

An array of complex debt products, such as mortgage-backed securities and collateralised debt obligations (CDOs), collapsed in value over the summer as Americans began defaulting on the underlying mortgages in record numbers. Many of the most obscure products are now virtually untradeable, and Wall Street has struggled to work out the scale of the losses on which they are sitting. So far, firms have written off a total of about $45bn, but Mr Blankfein and other presenters at the Merrill Lynch banking and financial services investor conference said that figure would go higher still.

Read more: http://news.independent.co.uk/business/news/article3157810.ece

:eyes: Fuckwittages.

Thought that sub-prime loans were a good idea then provided the credit and bought the debt.

I paid off my loan in 2002 'cause I saw this coming.

:hi: :loveya: :hi:

:hi::loveya::hi:

"An array of complex debt products, such as mortgage-backed securities and collateralised debt obligations (CDOs), collapsed in value over the summer as Americans began defaulting on the underlying mortgages in record numbers."

:crazy:

William Strunk is rolling in his grave.

punctuation is good... reminds me of the wind parts in the Brandenburg Concerti (J.S. Bach)...no damned place to take a breath in long passages of 16th notes (gasp, wheeze, gasp)...

How about some very low interest loans to bail people out?

But HELL NO! That would be too easy! :puke:

I can't afford to buy a home and continued to pay a rent. Why organize the bail-out of people who knew they were paying too high a house with interests moving upwards, it was a speculative move ! Buy a house no matter the interets, the inflated prices, they just wanted to sold it higher a few years later. No bailout for the speculators, the realtors and the banks ! Btw, nice move by GS, they're the best in Wall Street they warned long ago about the shitty business around housing and the securtization of its debt (CDO MBS etc), they deserve what they reap.

the tax payers?

When those of us who saw disaster written on the winds of war that George W. Bush was stoking in Afghanistan and Iraq, we were accused of wanting more people to die by reporting that disaster was imminent. That somehow, identifying the blunders would call them into being, and that we were somehow going to gain an advantage of some sort by naming the catastrophe. Oh, the pearls that were clutched! The fainting spells that reduced otherwise strong, macho men to reclining on chaises!

Well, here we have clear-eyed, green-visored bean counters on Wall Street betting on more financial misery for their fellow citizens, and the collapse of a crucial segment of the economy, and trying to inveigle big money investors into funding their plunder as people go under. When will Billo (who famously claims to be looking out for the little guy) and Seanie use their valuable platforms to decry this despicable behavior? Or are they too busy reaching for their overstuffed wallets, looking to make a killing off others' misfortune?