Goldman Says "Trust Us"

...our exposure to AIG is offset by
collateral and hedges and is not material
to Goldman Sachs in any way...

So, two things, Lucas (Lucifer, surely? - Ed) van Praag, spokesman for Goldman Sachs (GS). How about:

1. Disclosing net exposure to AIG (AIG), including details of the alleged collateral and hedges, and the alleged financial viability of the alleged counterparties to those alleged transactions, and

2. Applying to the New York Stock Exchange for removal from the protected species list. 

I thought so. 

Goldman Sachs faults NY Times story on AIG risk
Reuters Sep. 28 2008

Earlier on NakedShorts:

Porkie du Credit Shambles
Sep. 29 2008

Comments

[FatPat:]

Somehow I get the feeling that Goldman is in really bad trouble, worse than Morgan Stanley. People do not notice since Goldman, due to its reputation and influence, can afford to be even less transparent than other financial instutions. They will have a reason for giving options worth USD 2 Billion to Buffett for free just to get him to lend money at 10%.

Goldman is way to expensive. Short Goldman if it will be allowed again!

2008 Oct 02 09:32 AM

[kotika98:]

what they mean to say that they've made a lot more money shorting AIG stock than the net amount AIG owned them, after taking into account the collateral. whats not to believe? you can count on goldman to take advantage of any situation.

2008 Oct 02 10:12 AM

[Vox Rationalis:]

Does anybody believe that Warren Buffett wrote a $5,000,000,000 check without seeing under the GS kimono?

2008 Oct 02 10:17 AM

[tom shane:]

"Applying to the New York Stock Exchange for removal from the protected species list."
- why give away a free protection? that would be stupid.

"Somehow I get the feeling that Goldman is in really bad trouble, worse than Morgan Stanley."
- don't forget it's 10% perpetual lending! if GS goes down, Buffet loses 5B! i guess you must know something Buffet doesn't? please be my guest to short GS in a big way, follow your own advice.

2008 Oct 02 10:20 AM

[venividivici:]

I think these investments by Buffet are motivated by a fear that the market is teetering on the brink of systemic collapse, which of course would be disasterous for him. I think he is trying to show that he has faith in these "titans" of the market. MInd you, the very harsh terms he has exacted from both Goldman and GE would hardly fill anyone with great confidence because it shows how desperate they are for money at any price. It also shows that ordinary shareholders are always going to be shafted in the effort to survive

2008 Oct 02 11:43 AM

[helplessobs...:]

I agree with venivindivici and was stunned when GE finds itself bleeding badly and needing a costly infusion. Sold my GE on the news at a loss, but my $8k will be around to fight another day. Wow, if this can happen to AAA rated GE what about F and GM? For what its worth we need to use taxpayer money to inject funds into the banks, capital accounts, forget about buying the toxic waste to improve their capital accounts. My prediction, in a year the $700k will be gone and banks will still be in trouble.

2008 Oct 02 01:39 PM

[Vox Rationalis:]

Do you really think Buffett believes that his $8B can have a significant impact on a market "on the brink of a systemic collapse"? Really?

BRK is better equipped to handle a significant downturn than perhaps any other company you can name. These investments were made because they were fantastic opportunities. Period.

As for GS and GE, they chose the cover of a BRK investment because of the very real possibility of a more expensive or a failed secondary offering. Could Goldman without Buffett have raised $7.5B at $110 rather than $2.5B at $125? Could GE without Buffett have raised $15B at $21 rather than $12B at $22.5? I don't know the answers.

2008 Oct 02 02:18 PM

[User 274372:]

Looks like the market has has enough of human greed and is adjusting itself. Just like mother earth.....

2008 Oct 03 11:38 PM