Goldman Sachs

A New Outrageous Excuse! Unfortunately, It Was True…

/ Jack Marshall / Leave a comment

When the African nation of Togo protested that its embarrassing soccer loss to the Bahrain national team was due to a group of imposters masquerading as the Togo squad, I was excited: at least I had a new desperate, brazen and hopeless lie to enter the Ethics Alarms Futile Lie Hall of Fame, joining Jimmy Durante’s immortal “Elephant? What elephant?” line in the musical “Jumbo” (in response to being caught red-handed stealing the largest elephant in captivity, Lindsay Lohan’s explanation to police officers who had found cocaine in her pockets that “these aren’t my pants,” and comedian Michael Richards’ claim that he has no idea why he started yelling “Nigger!” at two black audience members when he has not a bigoted bone in his body—the  controversial “I was possessed!” excuse.

The “It’s not our fault: someone was impersonating me!” lie has great promise, not just for other disappointing athletic teams, but for politicians, John Edwards, the Democratic Congress, the producers of the “Sex in the City” movie sequel, Kanye West and Goldman Sachs. Thus I was devastated to find out that Togo wasn’t lying at all: their soccer team had been replaced by imposters.

Oh, well. And because the excuse now has validity, the “Someone was impersonating us!” excuse no longer qualifies as a sufficiently desperate and hopeless lie. It looks like Li-Lo, Kramer and “the Schnoz”  will have to wait a bit longer for their quartet.

Summer Rerun: “Ending the Bi-Partisan Effort to Destroy Trust in America”

/ Jack Marshall / 2 Comments

[TV is full of reruns these days, and sometimes I am grateful for them, for it gives me a chance to see episodes of favorite shows I had missed for some reason or another. Back in early March, I posted the following essay about the origins of America’s current crisis of trust in our government, and how it might be cured by our elected leaders. Since then, the crisis has deepened, and as I was doing some routine site maintenance, I reread the post. It is still very timely (unfortunately), and since far fewer people were visiting Ethics Alarms in March, I decided to re-post it today, with just a few minor edits. I promise not to make this a habit. Still, trust is the reason why ethics is so important in America: if there is a single post of the more than 700 I have written here since October 2009  that I would like people to read, this is it.] Continue reading →

DeLay and Blagojevich: Not Vindicated, Not Innocent, and Not Ethical

/ Jack Marshall / Leave a comment

Both Rod Blagojevich and Tom DeLay were taking victory laps this week, Blago because a jury failed to come to an agreement on his trial for selling political favors, DeLay because the Justice Department dropped its prosecution of  him. In the minds of both of these corrupt and shameless politicians, they were indeed vindicated, because both operate under the delusion that if one’s conduct manages to avoid breaking laws to the point where one could be found guilty beyond a reasonable doubt, then that conduct is “ethical.” This same delusion has been shared by many other human blights on American society and ethical corrupters in business and politics, including Presidents Richard Nixon, and Bill Clinton, Ken Lay, the executives at Goldman Sachs and AIG, Marion Barry, Maxine Waters, and too many others to mention. It is still a delusion. Continue reading →

Sec. Geithner’s Dead Ethics Alarm

/ Jack Marshall / 11 Comments

The ethics problems in the financial sector are rooted in conflicts of interest, some willful, some systemic, some naive. The presumption of the Obama administration when it chose Timothy Geithner to be Treasury Secretary at this time of collapsing trust in bid business was that Geithner, a supposedly canny insider, would bring to the job an invaluable understanding of the systemic problems, and perhaps he has. But the fact that he also brought a stunning insensitivity to basic conflicts principles is disturbing. Continue reading →

Sunday Ethics Round-Up: Cynical Fines, Drunk Norwegians, Lazy Newsmen and Pitiful Ballplayers

/ Jack Marshall / 5 Comments

Here are some ethics issues to ponder from the recent news and around the Web:

  • Who says it pays to be ethical? The astounding insistence, under oath, by Goldman Sachs executives that they had done nothing wrong in selling admittedly “crummy” investment products to clients while using the company’s own money to bet that the same products would fail will not be sufficiently punished or contradicted by the S.E.C.’s cynical cash settlement of its suit against the firm. For a $500 million penalty, Goldman Sachs is off the hook for the equivalent of four days’ income, as the Obama Administration claims to the unsophisticated public (“Isn’t $500 million a lot of money?”) that it is “getting tough” with Wall Street. The fact is that Goldman Sachs’ unethical maneuvers paid off handsomely, and nothing has happened that will discourage it from finding loopholes in another set of regulations and making another killing while deceiving investors legally and, by the Bizarro World ethics of the investment world, “ethically.” You can read a perceptive analysis here. Continue reading →

Shrugging Off Corrupt Fundraising Practices in Congress

/ Jack Marshall / 1 Comment

While they were debating the just-passed financial reform bill on the floor of Congress, eight members of Congress walked out of the Capitol into fundraising meetings and events where they solicited and received contributions from the very financial institutions that the bill would regulate. Some of the contributions came as crucial votes were taken.  From a New York Times report: Continue reading →

The Amazing, Versatile and Unethical Goldman Sachs Code of Ethics

/ Jack Marshall / 6 Comments

Perhaps we all owe Goldman Sachs an apology. Everyone heaped outrage and ridicule the April spectacle of its executives going before the U.S. Senate and asserting under oath that they saw nothing at all unethical about intentionally selling “crappy” investment products to their trusting customers, then making money for their own firm by betting that the products would fail. Many were reminded of the tobacco executives, in the famous AP photo, all raising their hands to swear that they did not believe nicotine was addictive. After all, Goldman Sachs’s own website pledged openness, honesty, trustworthiness and integrity, saying,

“A critical part of running the marathon is acting consistently and playing a fair and honest game. ‘There’s only one thing we sell, and that’s trust.’ This applies to anything, but nowhere more than Investment Management. Clients trust us to do the right thing, and particularly when you’re in investment management and you’re appointed to manage clients’ money, they trust that you’re going to do it in a prudent manner. The worst thing you could do is breach that trust. We look for people who want to run the marathon, and who understand that trust fuels it.”

Now it seems that we were lacking a crucial document: the firm’s internal Code of Ethics, which Goldman Sachs recently made public. Under the provisions of this remarkable Code, what Goldman Sachs did to its clients wasn’t unethical at all; deceptive, conflicted, and unfair, yes…but not unethical, in the sense that it didn’t violate the Ethics Code itself. “Impossible!” you say? Ah, you underestimate the firm’s cleverness. Continue reading →

Goldman Sachs Ethics: An Easy Call

/ Jack Marshall / 5 Comments

Sometimes the biggest ethics stories are the easiest. I haven’t written much about Enron, for example. When a company uses deceptive, shell corporations to hide its liabilities so profit reports look artificially rosy and investors keep buying company stock, it is obviously unethical. Even the ethics-challenged management of Enron could figure that out. The Goldman Sachs scandal, once one clears away the static and spin, is almost as straight-forward.

Are the Democrats seizing upon Goldman Sachs as a scapegoat for the financial meltdown they, like the Republicans, were complicit in as well? Obviously. That doesn’t mean that the firm doesn’t deserve all the abuse that is being heaped on it. Did the S.E.C., supposedly an apolitical and independent agency, time the announcement of its suit against Goldman Sachs to help rally public opinion behind the Obama Administration’s proposed Wall Street reforms? It wouldn’t surprise me. We have seen previous Justice Departments, the C.I.A., the F.B.I. and other supposedly “non-political” entities act blatantly partisan over and over again. The S.E.C. trying to give Obama’s reforms a boost would be one of the least dastardly of these breaches, especially since the public should be informed about the kind of conduct the culture of Wall Street permits. G.O.P. complaints about the timing of the announcement are, to say the least, strange. Would it be better to hide this story from the public? What matters is whether the S.E.C. has a legitimate case. It is clear that it has. It may not turn out to be a winning case, but it is legitimate. [Note: Personally, I think it is  more likely that the S.E.C. announced the law suit to counter the embarrassing revelation that so many of its regulators spent endless hours on the job surfing and downloading pornography off the internet.]

The legal issues will probably be settled in court; the topic now is ethics. After watching the testimony of various Goldman Sachs officials before the Senate, I find it hard to see a credible argument that what the firm did—selling what its own employees referred to as “crappy” investment products to firm clients, and then betting its own funds that those products would end up losers—could be called anything but unethical. Continue reading →

Ethically Irresponsible Headline of the Month: The Drudge Report

/ Jack Marshall / Leave a comment

“WILL OBAMA RETURN $994,795 IN GOLDMAN SACHS CAMPAIGN CONTRIBUTIONS?” screams the Drudge Report, in response to the Obama Administration’s charges of fraud and corruption at Goldman Sachs.

What exactly is this headline trying to imply? Continue reading →