wpe50.jpg (1913 bytes)     TigerSoft News Service    10/20/2008      www.tigersoft.com   
        The Foxes from Goldman Sachs
                Are Now in The Hen house.


                   $700 Billion
       Down Paulson's Rat Hole

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                 Updated - 11/17/2008  Goldman is accused of price manipulation using naked short sales.          

                                                                    by William Schmidt, Ph.D. 
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 Should We Trust Paulson and
               His Goldman Sachs Cronies
      To Administer The $700 Billion Bailout

    by William Schmidt, Ph.D.
                                          (C) 2008  www.tigersoft.com  

Right away, something stinks in the administration
                   of the bailout.  We are told that
all the biggest banks are to get
                   $25 billion,  whether they need it or not, to conceal the identity
                   of the banks that need capital the most.  Bank of America
                   insists it does not need the money.  But it will get the $25 billion

                               This means that $80.00 will come out of the pocket of
                   every living American and will go to Bank of America alone,
                   no matter that the country is in recession and many ordinary
                   people would could really use the $80 much better,  for food,
                   needed medicine, a doctor's visit, a new tire... 

                                Paulson is crazy!  If they don't even need the money,
                   don't give it to them.  He is just being palsy-walsy with his buds
                   at our expense.

           wpeF7.jpg (33238 bytes)  
  US Treasury faces, from left: Steve Shafran (formerly of Goldman),
                  Kendrick Wilson III (ditto), Henry Paulson Jr. (you guessed it), Edward Forst (yep)
                  and Neel Kashkari (right again!)

                   Paulson Helped Create The Mess!
                        Why Should We Trust Him?

             Paulson's lobbied repeatedly from 2000 to 2004 for
              increasing the allowable leverage that hedge funds could
              use.    He got a special exemption for Goldman Sachs in
              that allowed them and other investment bankers to give
              hedge funds significantly higher leverage.  His victory
              won Wall Street huge profits, but it lost the American people
              TRILLIONs when hedge funds went BUST in the Fall of 2008
              and they rushed to "deleverage".  

                     Paulson is man used to getting his way.   Arrogant men
              don't quickly admit their shortcomings or the limits of
              what they know.  As US Treasury Secretary, repeatedly denied
              that there could be a financial melt-down and a recession.
                                         January 8, 2008.     No recession is in sight.
                                          February 14, 2008 - "Rate cuts and rebates should
                       keep the economy out of recession." 
                    (1) Others knew better. (2) "Bull Shit"
                                         August 16, 2008  "A recession is preventable"
                      "In Paulson's eyes there isn't much more that the U.S.
                        government can do to help the economy and stock market."

                    Not one to take responsibility for himself, Paulson said
               on September 23rd that Congress would be to blame for the
              recession if they did not pass the $700 billion bankers' bailout .

                                                  Wall Street's Pimp
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                      Look at what  Paulson originally sought to get from Congress.
  1. Advisers from Wall Street to be retained to decide who gets what.
    "Huh? Let the architects of this mess figure out how to fix it?
    Really, I think it just means they get to figure out how to best enrich themselves.
  2. No limits for executive compensation.
  3. No equity share for the government. "If the government is going to bail these guys out, there
    should be at least some sort of way for the government to recover something.
  4. Decisions not reviewable. Unbelievable!  One guy gets the final say??!
    He wants a dictatorship, not responsible government.  Congress better wake up!
  5. Protections from lawsuits. "Everyone involved cannot be held accountable for the results of the outcomes from whatever action is taken. Sounds like what is happening now. Great risks taken, but accountability is limited and the losses are socialized and spread amongst even the innocent."

                               Freedom for the Pike is Death for the Minnows.

                    He refused to urge tighter regulations of commodity hedge
              funds, to seek a limit on the size of their positions in individual
              commodities, to require that hedge funds' short positions
              be a matter of public record.  He would not support an increase
              in margin requirements to curb dangerous speculation in
              Gold, Silver, Platinum,  Wheat, Corn, Rice, etc. - all the
              commodities that boomed and went bust recently. 

               His solution for the collapse of banks' stocks is to
               bail them out with $700 billion.  And his office will
                administer the largesse to his cronies.  But accountability
               is limited to what he chooses to tell the public. 

               So, who has Paulson hired to give the $700 billion away?
               How did you know.  Lots of Goldman Sachs cronies!

From the NY Times - 10/17/2008

arlier this month, when Mr. Paulson needed someone to oversee the government’s
           proposed $700 billion bailout fund, he again recruited someone with a Goldman pedigree,
           giving the post to a 35-year-old former investment banker who, before coming to the Treasury
           Department, had little background in housing finance.  Indeed, Goldman’s presence in the
           department and around the federal response to the financial crisis is so ubiquitous that other
            bankers and competitors have given the star-studded firm a new nickname: Government Sachs.

              "The power and influence that Goldman wields at the nexus of politics and finance is no
            accident. Long regarded as the savviest and most admired firm among the ranks — now
            decimated — of Wall Street investment banks, it has a history and culture of encouraging its
            partners to take leadership roles in public service.

              "It is a widely held view within the bank that no matter how much money you pile up,
            you are not a true Goldman star until you make your mark in the political sphere. While Goldman
            sees this as little more than giving back to the financial world, outside executives and analysts wonder
            about potential conflicts of interest presented by the firm’s unique perch.   They note that the decisions
            that Mr. Paulson and other Goldman alumni make at Treasury directly affect the firm’s own
            fortunes. They also question why Goldman, which with other firms may have helped fuel the
            financial crisis through the use of exotic securities, has such a strong hand in trying to resolve
            the problem.
The very scale of the financial calamity and the historic government response to it have
            spawned a host of other questions about Goldman’s role.

             "Analysts wonder why Mr. Paulson hasn’t hired more individuals from other banks to limit the
            appearance that the Treasury Department has become a de facto Goldman division. Others ask
            whose interests Mr. Paulson and his coterie of former Goldman executives have in mind: those
            overseeing tottering financial services firms, or average homeowners squeezed by the crisis?
            Still others question whether Goldman alumni leading the federal bailout have the breadth and
            depth of experience needed to tackle financial problems of such complexity — and whether Mr. "
            Paulson has cast his net widely enough to ensure that innovative responses are pursued.
             “He’s brought on people who have the same life experiences and ideologies as he does,” said
             William K. Black, an associate professor of law and economics at the University of Missouri and
             counsel to the Federal Home Loan Bank Board during the savings and loan crisis of the 1980s.
             “These people were trained by Paulson, evaluated by Paulson so their mind-set is not just shaped
               in generalized group think — it’s specific Paulson group think.”...
                "MR. PAULSON himself landed atop Treasury because of a Goldman tie. Joshua B. Bolten,
               a former Goldman executive and President Bush’s chief of staff, helped recruit him to the post in 2006.                           (Source of this quote - NY Times 10/17/2008 )

                              Insiders Are Now Buying Goldman Sachs

Not surprisingly, its people now run the country's finances from
                     Washington as well as from Wall Street

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               WHAT's GOOD FOR GOLDMAN IS

                         I remember that Henry Ford, besides saying "history
                   was bunk", is famous saying that "what is good for Ford
                   is good for the US".  Ford and GM are Main Street America.
                   So, as long as wages were good there, the statement
                   had appeal.  But, I seriously doubt that what's good for
                   Goldman is good for America.  We do NOT need more
                   Wall Street billionaires.  WE do NOT need more exotic
                   derivatives.   We do NOT need more leverage for hedge funds.
                   We do NOT need de-regulation and laissez-faire on Wall Street.
                   Just the opposite.

                         The bailout and its administration are the height of
                   arrogance, cronyism, elitism.   Plutocracy runs the US.
                   We cannot be cynical enough.  And the precedent is
                   horrendous.   The foxes should not run the hen house.
                   And they certainly should be NOT be given a trillion dollars
                   when Main Street is hurting this much.

                          Paulson was not elected to any position, anywhere.
                  Yet he and the Federal Reserve will be giving away

                 the equivalent to  1/12th of the nation's entire annual
                  goods and services with only such accountability as
                  he chooses to offer.  The Congresspersons who voted
                  for this abandonment of democracy and accountability
                  do not deserve re-election.

                          Not surprisingly, reactions are very negative in many

                  From Yahoo - 10/20/2008
Many issues about the rescue plan and the economy remain unanswered, but a more
                         fundamental question remains: Are the Fed chairman and Treasury secretary up to the job?
                         A resounding "no" is the answer from Christopher Whalen, managing director at Institutional Risk
                        Analytics, who is particularly critical of Paulson.   The Treasury secretary is "grotesquely conflicted"
                         in his efforts to bail out his former employer, as detailed here, and has found "common cause" with
                        an overly lenient Fed chairman.   "They have a bias to preserve the derivatives market" --
                        the riskiest part of Wall Street, Whalen says, noting the government let Lehman and Bear fail
                        but bailed out AIG and (according to Whalen) rescued Goldman Sachs and Morgan --
                        at least for the time being." ( http://finance.yahoo.com/tech-ticker/Newsmakers   )

                           All this publicity of the political and financial power is surey helping
                        Goldman Sachs' stock.

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