Buffett Vigorously Defends Goldman; Berkshire Posts Profit

Buffett Defends Goldman; Berkshire Posts Profit

By SCOTT PATTERSON And ERIK HOLM


OMAHA, Neb.—Warren Buffett offered a vigorous defense of Goldman Sachs Group Inc. at Berkshire Hathaway Inc.'s annual meeting Saturday, saying the firm hadn't engaged in improper activity.

Goldman has been reeling from Securities and Exchange Commission allegations that the bank had engaged in fraudulent activities in relation to a mortgage deal called Abacus. Goldman says it did nothing wrong.

His comments offer a powerful vote of confidence in Goldman, which has seen its shares slide since the SEC announced the investigation on April 16. Goldman's shares fell 9.4% on Friday after it emerged that the Manhattan district attorney's office was conducting a preliminary criminal probe into its mortgage-trading activities.

"We have had a lot of very satisfactory transactions with Goldman Sachs," Mr. Buffett said.

more...

http://online.wsj.com/article/SB10001424052748704608104575218071029226354.html?mod=WSJ_hpp_LEFTTopStories

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Goldman didn't tell SEC about mortgage moves for months

By Greg Gordon and Chris Adams | McClatchy Newspapers


WASHINGTON — In December 2006, Goldman Sachs embarked on a frantic effort to shed billions of dollars in risky mortgage securities and purchase exotic insurance to protect itself against what it had concluded could be the collapse of America's housing market.

Yet for nine months, until Sept. 20, 2007, the Wall Street giant didn't disclose its actions in key filings with the Securities and Exchange Commission, in telephone conferences with analysts or in its press releases.

A McClatchy review of hundreds of pages of subpoenaed company records released by a Senate panel Tuesday, as well as Goldman's SEC filings, has revealed how closely the company guarded its secret exit plan.

Goldman's failure to tell the investors who bought its risky mortgage securities that it had made an array of wagers against housing is at the heart of the furor now enveloping the nation's premier investment house, the only major Wall Street firm to exit the subprime mortgage market with minimal damage.

By the time Goldman finally began to divulge its strategies to the SEC, credit markets were freezing up and the investment bank was well on its way to making billions of dollars in revenue from its negative bets, known in the industry as "shorts."

more...

http://www.mcclatchydc.com/2010/04/30/93252/goldman-sought-to-shed-risky-mortgage.html

fwiw, they are cousins

fwiw, they are cousins

:hi:

:) :hi:

He knows a helluva lot more about all of this sh*t than we do and he isn't saying no one did anything wrong, he is specifically saying that Goldman weren't the instigators of the charges the SEC has filed against them but rather the other company he mentions.

It certainly is true that there were multiple companies playing a role in the housing market collapse, so while I think he's naive to think that Goldman "did nothing wrong" it is definitely possible that other companies may have been more at fault than them.

I don't know, I'm just an idiot on my computer on a Saturday afternoon, but I'm sure none of us knows the whole story especially when you start getting into subsidiaries and partners and whatever other companies out there connected to other companies, connected to other companies, etc.

and that is that Buffett has some skeletons in his closet the likes of GS and is trying to justify them. I don't know that for a fact - but him defending GS makes me awful suspicious.

http://www.cnbc.com/id/32982928

'...In a late-day news release, Goldman announced a private deal to sell Berkshire $5 billion of perpetual preferred stock. In effect, Berkshire was giving Goldman a massive loan. And you don't loan that kind of money to a firm you think could follow Lehman down the drain.

Goldman agreed to pay Berkshire a 10 percent annual dividend on the preferred stock. That's $500 million a year, and the payout didn't depend at all on what happened to Goldman's common stock price.'

more at link

been for Mr. Buffett to defend them. Not very, seems like.

I also wonder if he might have a different opinion if he had no investments with Goldman.

civil suit was released.

I definitely agree I could be dead wrong. As disagreeable as the Goldman testimonies were, I think they did what they are paid to do: make markets.

But this may be a huge learning experience for me, and I admit I could be HUGELY wrong on this issue.

I have never been one of those DUers who is afraid to change his mind, and this may well be another instance.

Whatever. It wasn't a speculative risk, so Buffett is wrong. No wonder this 'to big to fail' jumbo made such an impact...they actually believe it. The gravitas of some people.