Beware the Conflicts of Interest in Money Management
In 1954, after 25 years, the Dow Jones Industrial Average regained its previous all-time high set in August of 1929. Coincidentally, that same year Harvard economist John Kenneth Galbraith published his landmark study of the debacle, The Great Crash: 1929. Galbraith was no fan of unfettered capital markets, and blamed the crash on rampant speculation, among other things, .. read more
Caveat Emptor
Caveat Emptor – let the buyer beware – is a principle that applies to any transaction where no warranty exists. The buyer bears the risk and should therefore exercise care and due diligence prior to purchasing such products, especially when the person doing the buying is acting on behalf and for the benefit of others. This principle is .. read more
SEC Sues Goldman Sachs
The SEC has filed suit against Goldman Sachs: Goldman Sachs, which emerged relatively unscathed from the financial crisis, was accused of securities fraud in a civil suit filed Friday by the Securities and Exchange Commission, which claims the bank created and sold a mortgage investment that was secretly devised to fail. The move marks the .. read more
Nattering Nabobs
One of the most interesting debates in economic and investing circles today concerns the mental state of investors. Are they overly optimistic about the state of the economy, buying stocks with no regard for the risks? Or are they still so shell shocked that they’re willing to pay Uncle Sam to hold their money in T Bills? Stocks .. read more
No Bonuses For Goldman Execs
Via MarketWatch: Pressured by an almost-unprecedented financial meltdown and a gathering outcry over executive pay on Main Street, Goldman Sachs Group Inc. reportedly will pay no bonuses in 2008 to its top management — a move that may set the precedent across a troubled Wall Street. The executives will only receive their base salaries of .. read more
Meet the New Boss
The Treasury Department yesterday named Neel Kashkari as interim assistant secretary for financial stability. Will Kashkari be working for the Ministry of Truth? And who was Mr. Kashkari’s last employer? None other than Goldman Sachs. As Arnold Kling points out: Instead of thinking of the pending bailouts and financial regulation as a new era of government supervisions of .. read more
Buffet Buys Into Goldman
Via WSJ: Warren Buffett’s Berkshire Hathaway announced plans to invest $5 billion in Goldman Sachs Group Inc., which recently decided to change its structure to a bank-holding company from an investment bank. In addition to the $5 billion from Berkshire Hathaway, which comes in the form of perpetual preferred shares, Goldman will raise at least .. read more
