Fed eyes insurance contracts on Greek debt (Goldman sach)

Discussion in 'Economy' started by hvactec, Feb 25, 2010.

  1. hvactec
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    hvactec VIP Member

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    Bernanke says central bank looking into Goldman Sachs and other Wall Street firms' use of a sophisticated investment instrument to make bets Greece will default on its debt

    Jeannine Aversa

    Washington — The Associated Press Published on Thursday, Feb. 25, 2010 10:07AM EST Last updated on Thursday, Feb. 25, 2010 3:20PM EST

    Federal Reserve chairman Ben Bernanke told lawmakers Thursday that the central bank is looking into the use by Goldman Sachs (GS-N156.03-2.30-1.45%) and other Wall Street firms of a sophisticated investment instrument to make bets that Greece will default on its debt.

    Mr. Bernanke said the Fed is looking into companies' use of credit default swaps, a form of insurance against bond defaults. Mr. Bernanke made the comments at the start of a Senate Banking Committee hearing, where the Fed chief delivered his twice-a-year economic report to Congress.

    “Obviously, using these instruments in a way that intentionally destabilizes a company or a country is counterproductive,” Mr. Bernanke said, adding that the Securities and Exchange Commission probably will be looking into this matter as well.

    “We'll certainly be evaluating what we can learn from the activities of the holding companies that we supervise here in the U.S,” Mr. Bernanke said.

    The panel's chairman, Sen. Christopher Dodd, D-Conn., said he is troubled that this practice could worsen Greece's debt crisis.

    “We have a situation in which major financial institutions are amplifying a public crisis for what would appear to be for private gain,” Mr. Dodd said.

    Mr. Dodd wondered whether there ought to be limits on the use of credit default swaps to prevent “the intentional creation of runs against governments.”

    On another topic, Mr. Bernanke said that the snowstorms and bad weather that has recently plagued the country is likely to have a short-term – but not permanent – impact on unemployment and layoffs. He said policy makers will “have to be careful about not overinterpreting” coming data.

    Even though the economy is growing once again, senators on both side of the aisle worried about high unemployment – now at 9.7 per cent – rising home foreclosures and difficulties people and businesses have in getting loans.

    “The state of our economy as a whole may be improving, but if we're talking about the situation of ordinary American families, I think I can sum up this recovery in three words: not good enough,” Mr. Dodd said.
    full story Fed eyes insurance contracts on Greek debt - The Globe and Mail
     
  2. Neubarth
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    Neubarth At the Ballpark July 30th

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    Goldman Sachs set Greece up against failure so that GS could then take CDS positions that would pay off handsomely if Greece defaulted. GS has no morals or ethics. That is the reason why I want all of their officers hung by the neck until dead when we have our revolution..
     
  3. Neubarth
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    Neubarth At the Ballpark July 30th

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    Ya say ya wanta Revolution?
    Wel-lll ya know, We all wanna save the world.
     
  4. georgephillip
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    georgephillip Gold Member Supporting Member

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    Where's John Lennon when we really need him........?

    Do you see similarities between Goldman and Enron? Specifically, in reporting bigger and bigger profits but losing more money in cash every year?

    If it's proven in court the entire relationship between Goldman and AIG was a sham,i.e., "Goldman didn't merely buy insurance on a bunch of random CDOs. It actually bought insurance on special CDOs it had put together and sold to its own clients.

    "In other words, Goldman knew more about these CDOs than anyone else. Goldman bought insurance on these CDOs because it knew they would COLLAPSE." (My caps)

    See: "The Daily Crux (Friday, February 26, 2010)>Porter Stansberry:This is one of the biggest Wall Street Frauds ever...

    Ya know, Wall Street OWNS the US Treasury Department and the Federal Reserve.
    Huey Long saw that decades before Lennon was born.

    Huey thought the American government functioned like a resturant that served only one dish.
    There were Republican waiters along one wall,
    and Democrat waiters lining the other.

    But whichever party delivered your order "...all the grub comes from Wall Street's kitchen."

    Huey would know how to use the Internet to FLUSH Wall Street's handmaidens, Republicans AND Democrats, from the US Congress starting next November 2nd.

    That would be the beginning of Revolution..........
     

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