Goldman Sachs Finds Support in Oracle of Omaha
Wall Street Journal reported that Federal prosecutors are conducting investigation of Goldman Sachs (GS) for bringing possible criminal suit against them. There is no final decision on it, yet, this is a serious escalation from the civil suit that SEC earlier brought against GS. David Weidner went so far to comment in MarketWatch, “The noose is tightening around the neck of Goldman Sachs Group Inc.”
Even Mike Whitney wrote enthusiastically, “Tuesday’s hearings of the Permanent Subcommittee on Investigations laid the groundwork for future criminal prosecutions of Goldman Sachs.”
I nonetheless think, GS would survive, with a little dent may be, but it would not lose its premier trading house position, and now I have none other than Oracle of Omaha to support my position.
Warren Buffet had significantly increased GS portfolio in his Berkshire Hathaway recently, and he is least worried about the company’s long-term future despite its stocks suffering so much in the interim. Referring to GS’s failure to disclose its conflicting interest, Buffett said that he would not care about it when entering a contract.
Even when asked to comment on Blankfein’s vile comment that Goldman was doing “God’s work,” Buffett clarified, “I would bet that was delivered as a throwaway line ... but he’s gotten killed.”
Whitney on the other hand thought, “Blankfein's answer was a triumph for Levin, and he knew it. To the millions of people watching the sequence on TV, Blankfein’s denial was as good as an admission of guilt. It showed that Wall Street kingpins do not share the same morals as everyone else. In fact, Blankfein seemed genuinely confused that morality would even be an issue. After all, it wasn’t for him.”
I too felt the same way watching Sen. Levin’s outstanding performance in the Senate hearing, but sadly accept that Buffet is going to come out triumphant. I also think Buffet would prove to be right because of the reason that American people are not enraged with the actions of GS and other Wall Street giants, and do not demand justice. So long American taxpayers remain aloof things are not going to change for the better.
Democracy does not work in vacuum.