"If there must be madness, something may be said for having it on a heroic scale"

July 1, 2009 6:40 PM

The Great American Bubble Machine."From tech stocks to high gas prices, Goldman Sachs has engineered every major market manipulation since the Great Depression - and they're about to do it again." Matt Taibbi's latest piece for Rolling Stone. [Via]
posted by homunculus (29 comments total)

The Daily Show: Clusterf#@k to the Poorhouse-Goldman Sach's Connections
posted by homunculus at 6:41 PM on July 1, 2009 [1 favorite]

So that's the shadow government!
posted by Roman Graves at 6:59 PM on July 1, 2009

They do what they do because they are enabled and empowered by the people we elect to protect us and our interests.
posted by Postroad at 7:09 PM on July 1, 2009 [3 favorites]

I wish to hell I could read this, as it seems very interesting, but that interface is impossible.
posted by TheNewWazoo at 7:24 PM on July 1, 2009

So that's what's up with gas prices!
posted by qvantamon at 7:29 PM on July 1, 2009

I think the problem with GS is just one of size. What they are doing is what any Wall St. company would do if it was smart or big enough. Hedging on the real estate bubble was just a sensible thing to do.

The problem when you get too big is that you are no longer either a buyer or seller you become the market. Maybe we should limit the size of these companies.
posted by bhnyc at 7:30 PM on July 1, 2009 [2 favorites]

They do what they do because they are enabled and empowered by the people we elect to protect us and our interests.

And because it makes them money.
posted by The World Famous at 7:31 PM on July 1, 2009

bhnyc: limiting the number of Alumni from them that can be part of the federal government (in paper or in practice) would be a good start
posted by qvantamon at 7:36 PM on July 1, 2009

Jewish bankers, eh? They're behind all of it!

The quoted sentence in the OP really sounds like tinfoil hat territory.
posted by Chocolate Pickle at 7:44 PM on July 1, 2009 [2 favorites]

I was prepared to be outraged before realizing the first link points to Scribd (which represents all that is wrong with the Internet today) and had my Sachs outrage replaced by a burning desire to see Scribd removed from the Interwebs.

fleetmouse: That link is not direct.
posted by null terminated at 7:47 PM on July 1, 2009 [2 favorites]

limiting the number of Alumni from them that can be part of the federal government
Paulson, Corzine, Rubin, Friedman... it's scary yes.
posted by bhnyc at 7:52 PM on July 1, 2009

Jewish bankers, eh? They're behind all of it!

Right. The fact that the named partners are Jewish indicates that every employee, ever, has also been Jewish, including all the alumni involved in government at some point, and therefore criticizing the power of the company and its alumni network is tantamount to antisemitism. Good point.
posted by rkent at 8:09 PM on July 1, 2009 [5 favorites]

How do you get it, read it, and post it...before I even get my RS delivered?

Conspiracy, indeed!
posted by hal_c_on at 8:10 PM on July 1, 2009

Best of the illegally redistributed print media?
posted by GuyZero at 8:10 PM on July 1, 2009

Maybe we should limit the size of these companies.

lololol you think that's possible
posted by Electrius at 8:11 PM on July 1, 2009 [1 favorite]

The problem when you get too big is that you are no longer either a buyer or seller you become the market.

Precisely. There really IS a conspiracy here. It's the conspiracy to make a profit, which every business expresses and acts upon. The problem is that companies like AIG and GS are so large that their influence is so pervasive and their little internal profit-making conspiracy monumentally manipulates a large swath of our economy.

Too big to fail? Then you should be too big to be afforded the prerogatives of being a corporation.
posted by darkstar at 8:18 PM on July 1, 2009 [1 favorite]

lololol you think that's possible
Yes, you just make a law. monopoly laws are for this. The FCC has rules on the size of companies. I know these laws weren't enforced during the bush years but it's different times now.
posted by bhnyc at 8:22 PM on July 1, 2009

I don't totally get the last section. Why is it evil to try and make money off alternative energy? If GS makes money because they own companies that invest in alternative energy sources, like windpower, how is that necessarily a bad thing?
posted by Falconetti at 8:26 PM on July 1, 2009

monopoly laws are for this.

But won't that stand in the way of a bunch of old white people becoming extraordinarily wealthy?
posted by !Jim at 8:40 PM on July 1, 2009

If this is true, then you have all you need to know to make money in the next bubble. Bet big early on whatever scheme Goldman Sachs comes up with next and then pull out your money and place bets against it right before the house catches on fire.
posted by jefeweiss at 8:47 PM on July 1, 2009

Yes, you just make a law.

De jure it's a simple matter to do this, but the reality— a hopelessly corrupt Congress overseeing "regulatory" agencies that are essentially controlled by the very entities they purport to control— means that it is essentially impossible to "just make a law" about the size of corporations. Nobody has enough independence, good will, and concentrated power to do so.
posted by Electrius at 8:48 PM on July 1, 2009 [2 favorites]

I don't totally get the last section. Why is it evil to try and make money off alternative energy? If GS makes money because they own companies that invest in alternative energy sources, like windpower, how is that necessarily a bad thing?

I believe it is about GS participating in the cap-and-trade carbon credit market, which is in the form of a type of market GS has been able to exploit in the past. Couple that with the steady rise of prices and gradual scarcity of credits that is built into the system, the author seems to fear that GS will be able use this not-yet-existent market to once again shift billions of dollars from the middle and lower class into board member pockets.

"If it's going to be a tax, I would prefer that Washington set the tax and collect it," says Michael masters, the hedge-fund director who spoke out against oil-futures speculation. "But we're saying that Wall Street can set the tax, and Wall Street can collect the tax. That's the last thing in the world I want. It's just asinine."
posted by hippybear at 8:52 PM on July 1, 2009

Well, then. I have absolutely no idea what to do with the money I will make once I leave school and get a job, since it will all get bubbled away.

...Maybe I'll invest in Goldman Sachs.
posted by Grimp0teuthis at 8:55 PM on July 1, 2009

So I how can I get a piece of their latest scam?
posted by Blazecock Pileon at 9:02 PM on July 1, 2009

The reason Goldman is able to do these things is because the Fed backstops them 1000%. They provide the fuel, the lack of oversight, and a bottomless checkbook to bail things out when they go bad.

Goldman is the how; the management at the Federal Reserve is the why.
posted by Malor at 9:09 PM on July 1, 2009 [2 favorites]

While I want to agree emotionally with what Taibbi writes, he neglects the fact that Goldman alumni are everywhere. No matter what the next bubble is, there is bound to be Goldman or ex-Goldman people there to reap some of the profits.

This article by Eric Janszen in Harper's in February 2008 is a much more rigorous and analytical examination of the rise and fall of bubbles over their long history. For what it's worth, the Harper's article concludes that the next bubble will be alternative energy, rather than cap and trade of carbon offsets. IF t he RS article in this posts interests you, you should definitely read the Harper's piece.
posted by Pastabagel at 9:19 PM on July 1, 2009 [4 favorites]

Haven't read this yet—hopefully will get some time tomorrow—but the timing on this story is great. Taibbi yet again has channeled the zeitgeist, or something.

'Cause just yesterday I saw Goldman mentioned in this story and immediately thought to myself (and even put it in my delicious comments for the link), "Goldman is involved with fucking everything—you see a disaster, and there they are."

Nice to know my instincts were telling me right on this one.
posted by limeonaire at 9:25 PM on July 1, 2009

I haven't read this yet. But I would very much like to drop acid with Matt Taibbi.
posted by BitterOldPunk at 9:25 PM on July 1, 2009 [1 favorite]

I'm put in mind of Vaneigem's “Everyone is asked their opinion about every detail in order to prevent them from having one about the totality.” By focussing on Goldman-Sachs Taibbi is able to give some concrete examples of modern finance capitalism in action, but bar a line or two here and there he never broadens the context which might leave the reader with the conclusion that the problem is this or that bad actor.
posted by Abiezer at 9:36 PM on July 1, 2009 [1 favorite]