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meechybee
10/27/09

In reply to AIG Only Wanted to Give Goldman Sachs 40 60 Cents on the Dollar, Then Geithner Stepped In
The only good that can come out of this mess is the death of the "kill Social Security and let Wall Street run it" movement. Then again, (collective) we have very short memories. #goldmansachs
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nowimpissed
10/27/09

In reply to AIG Only Wanted to Give Goldman Sachs 40 60 Cents on the Dollar, Then Geithner Stepped In
I don't understand the proposed solution that the government could have given Goldman Sachs a haircut on their insurance without giving the troubled banks one as well. Goldman had legally binding contracts with AIG for the full amount. Goldman owes their shareholders a fiduciary duty to get as much as possible for those contracts. Once the government stepped in to prevent AIG's bankruptcy, the government did not have a legal leg to stand on to pay some contracts but not others, so Goldman could not have taken less than the full contract amount without their shareholders (e.g. your 401K) rightly being up in arms over it. Yes, everyone was willing to negotiate for less when they thought AIG might go bankrupt, but once AIG was not in danger of bankruptcy, the negotiations effectively ended. Cook seems to accept that the failing banks would not have been able to take a substantial loss on the contracts and thus would have forced AIG into bankruptcy (or gone bankrupt themselves), which means the AIG bailout was necessary. Once that happens, why negotiate for less than your contract when the counter-party (now the government) can afford to pay 100% and has no legally valid reason not to? I don't know where the idea comes from that Geithner could have just unilaterally decided to not pay Goldman on its contracts while at the same time paying other banks. It's not a matter of Geithner favoring Goldman, it's just basic contract law and the reality of having a deep pocket behind AIG's legal obligations. #goldmansachs
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Novaload
10/27/09

In reply to AIG Only Wanted to Give Goldman Sachs 40 60 Cents on the Dollar, Then Geithner Stepped In
Geithner (and Summers) will go down as two huge Obama mistakes. The favoritism, the secrecy, the cozy Wall St. relationship---just disgusting. #goldmansachs
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lackadaisical
10/27/09

In reply to AIG Only Wanted to Give Goldman Sachs 40 60 Cents on the Dollar, Then Geithner Stepped In
Have we all forgotten the fact that Goldman has already repaid the gov't money - that they never wanted - plus interest?

If Goldman were losing money like every other bank, would we like them better? #goldmansachs
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registered
10/27/09

@lackadaisical: The AIG payment to GS is a separate matter from the TARP money that GS returned to the government.

"If Goldman were losing money like every other bank, would we like them better?" I’d hope not, but you have a point. I think the problem is not that GS is minting money this year, it’s the fact that it is proposing astronomical bonuses this year. Lloyd B could have been a bit more sensitive to how this would be perceived. It’s not written in stone that compensation has to be 50% of revenues. It would have been more prudent to add $10 billion to reserves to cushion the blow should another 2008 happen. Believe me, everyone at GS would still be more than adequately compensated. #goldmansachs
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charliebabbles
10/28/09

@registered: Well, that's only part of the problem. The real problem is two-fold: number one, Goldman most certainly DID need the TARP money. Technically they may not have actually needed the dollar amount, but they needed the gov guarantee which it represented. And number two, the main reason they're minting money now is because the gov has tilted the field in their favor. The gov stood by and allowed Lehman to fail, one of Goldman's major competitors, so Goldman is now eating Lehman's lunch. Additionally, the favorable funding rates which the gov is providing to GS (and others) makes it nearly impossible to not make money. So yeah, they're taking advantage of the opportunities presented to them (and good for them), but those opportunities exist due to gov largesse, not due to GS creating them. #goldmansachs
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registered
10/28/09

@charliebabbles: I don't disagree that every financial institution probably needed some sort of guarantee during the worst days of the crisis. Did I say they didn't?

I also agree with you that GS benefitted from Lehman's collapse, and the subsequent capital raising efforts of other financial institutions. Did I say they didn't? I just said they were minting money (w/o saying what was helping) and had no need to pay 50% of their windfall revenues to employees.

Please re-read my comment. I don't think we disagree. #goldmansachs
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Crucifictorius
10/27/09

In reply to AIG Only Wanted to Give Goldman Sachs 40 60 Cents on the Dollar, Then Geithner Stepped In
Dark pools are a bit overhyped thanks to a terrible name. The only real problem with them is that they run counter to the ECMH. If you can trade against a dark pool, then you can buy and sell shares based on your knowledge of the firm without that knowledge becoming built into the exchange price that everyone else sees. That's the whole thing about executing at the right price. Without the pool, major buyers and sellers end up front running themselves as they can't get all the shares they want at the same price. Supply tightens and the price goes up as a result of illiquidity. If enough people use dark pools, the ECMH is unequivocally false in practice regardless of whether it is true in theory. If you trade against the pool, no one sees your trade and you avoid the short term liquidity crunch but you also get away with making the transaction without 'showing your cards' to the broader market. So the issue of dark pools really comes down to whether you think that ma and pa shareholder are entitled to rely on a stock's price as a reflection of everyone's valuations, or if you are ok with saying that share prices are just a function of what people on the exchange are willing to pay today - if you want a valuation go do it yourself. #goldmansachs
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friend_of_a_friend
10/27/09

In reply to AIG Only Wanted to Give Goldman Sachs 40 60 Cents on the Dollar, Then Geithner Stepped In
One of his goals was to persuade the banks to accept discounts of as much as 40 cents on the dollar...

That means they wanted to pay 60 cents on the dollar. #goldmansachs
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John Cook
10/27/09

@friend_of_a_friend: You are correct. It's fixed. #goldmansachs
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Unsolicited Advice
10/27/09

In reply to AIG Only Wanted to Give Goldman Sachs 40 60 Cents on the Dollar, Then Geithner Stepped In
Dark pools were established so institutional and UHNW clients could set market orders to transact extremely large amounts of shares without disclosing them to day-traders and other entities that would bid those positions up or down. Do you know what actually happened when Blue Horseshoe loved Anacott Steel, John? Dark pools were established strictly because of scenarios like that scene in Gekko's office where the foreign banker implores him to stop screwing up his acquisition of a controlling stake by convincing other buyers to jump into an otherwise-moribund investment. This only benefits Goldman insofar as it makes them able to service their clients better. The real victim in a world without dark pools would be institutional buyers and sellers. #goldmansachs
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DahlELama
10/27/09

In reply to AIG Only Wanted to Give Goldman Sachs 40 60 Cents on the Dollar, Then Geithner Stepped In
Sorry, can't help you--the only guy I know at Goldman is currently on a beautiful cross-country trip in the Middle East... Oh, wait. #goldmansachs
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FormerEnglishMajor
08/04/09

In reply to ~~Someone's~~ No One's Lying About the Price of Tim Geithner's House
What Goldman VP lives in a $1 mil house? Shouldn't there be another 0 there? Millette must be just a back-office guy if he's living in New Roc City.
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Uncle_Billy_Slumming
08/04/09

@FormerEnglishMajor:
No evidence that gold man lived in the house. No evidence that Geithner lived in the house. Maybe this is just a little piggy bank rental house and/or Mossad safe house.
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Uncle_Billy_Slumming
08/04/09

In reply to ~~Someone's~~ No One's Lying About the Price of Tim Geithner's House
So he took out about $930,000 in 2004, spent a couple hundred on the blue tiles of democracy, and did what with the rest? Private island up in Lake of the Woods? (In fairness though, nice ones were going for only $150-$250k back then)
That video was just an ad for Keller Williams real estate though, wasn't it?
Both Nino Pascolati, your NoCal Foreclosure Specialist! featured on the sign at the beginning (with phone number clearly shown) and Debbi Meiliken, the Westchester House Honey with the world class legs, both work out of Keller Williams real estate. The real estate-industrial complex strikes again!
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Unsolicited Advice
08/04/09

In reply to ~~Someone's~~ No One's Lying About the Price of Tim Geithner's House
That's interesting.
If you have conflicting reports, it means the 1.6 likely came from a 2004 refinancing. Rates were pretty much spot-on from 1998 to 2004, you can check them out here:
[mortgage-x.com]
Your mission, should you choose to accept it, is to find out if he refi'd out of an adjustable-rate or interest-only mortage in 2004. Or, better yet, if he was using his home price's appreciation to generate cash via refinancing. Since rates were the same, it was one of the three, and none of them will look good!
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lobstr
08/04/09

In reply to ~~Someone's~~ No One's Lying About the Price of Tim Geithner's House
So who is the asshole with $7500/mo to burn on that house that doesn't give a shit about equity ? :p
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naugahydeinplainsight
08/04/09

@lobstr: And does he/she have any business with the federal government. I sure hope someone checked.
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shostakobitch
08/04/09

@lobstr: goldman sachs
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Unsolicited Advice
08/04/09

@lobstr:
Higher-end home prices (this qualifies) have been collapsing much faster than houses in "conforming" price ranges. Year over year, houses from 1-2 million are dropping in price at a 27.9% clip nationally.
[www.cnbc.com]
If you're looking for a place in that price range and you fear price collapses, renting is the right move.
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overunderover
08/04/09

@lobstr: Rentals like that are most likely corporate relocations. For instance, the company you work for rents you a house for a year or until you can find/purchase your own, or something along those lines. This way, you can move your family and not live out of a hotel room.
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Forgetitjake
08/04/09

@overunderover:
Larchmont is a sort of a ghetto for foreign diplomats and executives who get transferred to New York for a term of maybe three or four years. The French-American School of New York is there. Lots of landlords who live off pricey and stable employer rentals. Also, Geithner did not live in one of the most expensive areas of Larchmont. (Okay, technically the house is not in Larchmont at all; it's in "the unincorporated area of the Town of Mamaroneck" with a Larchmont zip code.)
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FormerEnglishMajor
08/04/09

In reply to ~~Someone's~~ No One's Lying About the Price of Tim Geithner's House
You're missing the thousands he did in renovations. Blazingly bright tiles don't come cheap, y'know.In all seriousness, he did spend a lot fixing it up. $705,000 may have been his initial cost, but his all-in is over a mil, with bathroom and kitchen reno.

And I would argue that $1.6 makes him seem even MORE clueless. It's one thing to pay $1.6 and want to get out whole (ridiculous in this market though that is). But it's insanity to try to get +127% (based on $705,000) or even up +60% (based on $1 mil all-in cost) when all info points to the market having round-tripped back to 1997 levels.
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Edited by FormerEnglishMajor at 08/04/09 1:58 PM FormerEnglishMajor was starred

allyzay
08/04/09

@FormerEnglishMajor: Fair enough, but he didn't tear down the house and rebuild a palace that added nearly an additional million to the cost, though.
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son of spam
08/04/09

@allyzay: It would be a very dumb investment to put an additional million bucks into that house. My guess is that whoever is reporting the $1.6MM number has it wrong. He probably refi-ed the house based on that appraised valuation, got a $600,000 mortgage, and has $515,000 left on it. Or something like that.
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econdave
08/04/09

@son of spam:
We have a winner!
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FormerEnglishMajor
08/04/09

@son of spam: I doubt he paid $705,000 cash back in 1998. I'm thinking it was more like 25% down (so, $175,000), and that $515,000 makes more sense.
Anyhow in the early 2000's, home equity loans were cheaper, and for all we know he has one outstanding (hence why he's asking so much). The original purchase doc only has how the house was financed THEN; it would not have an update for a later home-equity loan.
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son of spam
08/04/09

@FormerEnglishMajor: Good point. Still, it's unlikely that he wouldn't have refi'ed along with the rest of America somewhere around 2004.
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Trulymadlyme
04/30/09

In reply to Tim Geithner's Brother Thinks He's Sexy
He looks like Jason Mraz.
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DorothyBarker
04/30/09

In reply to Tim Geithner's Brother Thinks He's Sexy
i don't know if i'd say 'most beautiful'. what i wold say: vulcan. seriously, look closely: the man is a vulcan who had a little cosmetic surgery to make him look more earthling-like...the ears, the eyebrows. and 'geithner'? that totally sounds like it could be spock's cousin's name. only thing that punctures this theory; his brother would then be a vulcan too and vulcans don't do cheesy nepotism fluffing. or work for people magazine. they're way above that shit.
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