The Corner

Goldman v. Enron Cont’d

From a reader:

Jonah:

Goldman is NOT being thrown under the bus.  This is a rope-a-dope scam and Goldman is in on it.  A politically divided SEC has brought a very weak case that will never see a court room.  It will be settled with a wrist-slap.  In return for being made the whipping boy — which Goldman is very used to and even thrives on — it will get a “regulation” bill that enshrines too-big-to-fail status upon it and which will give it the same competitive advantages that Fannie Mae and Freddie Mac enjoyed.  That is, an implicit taxpayer guarantee.  It will then be able to borrow at lower rates and engage in riskier behavior at a lower cost.  Meanwhile, smaller competitors will not enjoy this advantage, thereby making Goldman even more powerful and profitable.

Don’t buy the spin on this.  Obama is not throwing Goldman under the bus.  Goldman willingly jumped and will receive a huge payoff for its “sacrifice.”  But the rest of us will pay.  This is all a political scam from start to finish.

I think I hear someone playing “The Entertainer” in the lobby of the SEC.

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