I had missed this wonderful yarn about Goldman Sachs, which I now pick up from Michael Lewis, via Alea. Apparently Goldman is a big winner in the mortgage meltdown; they were betting against the mortgage biz, when everybody else was still in favor. Except.
Except what? Except they weren't really. Except that part of the firm was going one way and part going the other: one part was betting against the mortgage biz, while others were betting in favor.
This is means, in effect, that while one hand was putting dollars into the hands of GS investors, another hand was taking them out again. This is so goofy that it cries out for an abstruse explanation. But I'll cut with Occam's Razor: my guess is that individual trader/investors were concerned with their own trading strategies--and the compensation that flowed therefrom--and they really didn't give a rat's patootie whether the firm made money or not.
No comments:
Post a Comment