April 24th, 2010
03:00 PM ET
4 years ago

Goldman knew it profited from mortgage crisis

Goldman Sachs officials knew their bets against mortgages profited the firm, according to Senate documents.
Goldman Sachs officials knew their bets against mortgages profited the firm, according to Senate documents.

NEW YORK (CNNMoney.com) – Goldman Sachs officials knew their bets against mortgages, whose dramatic decline sparked the financial crisis, profited the firm, according to documents released Saturday by a Senate panel investigating the crisis.

"Of course we didn't dodge the mortgage mess," Goldman CEO Lloyd Blankfein told company executives in an e-mail dated Nov. 18, 2007. "We lost money, then made more than we lost because of shorts," or trading bets aimed at profiting when a bond drops in value.

Blankfein added: "Also, it's not over, so we don't know how it will turn out ultimately."

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Filed under: Goldman Sachs
soundoff (28 Responses)
  1. Illinoistom

    Goldman Sachs could give a rat's rear end what you populists call them, as long as they continue to get to make the rules. They have just as much power over Obama as they had with Bush.

    April 24, 2010 01:26 pm at 1:26 pm |
  2. Ken in NC

    Goldman Sachs is fortunate that they are before a Senate Hearing Panel and the SEC. After what they did to investors and our economy with the securities they put together, I suspect that if they were before the public, they would see their trial proceedings taking place and off to the right they would see the barrels of tar being heated up and the bags of feathers being unloaded in preparation for the TAR PARTY to be held immeadiately following their trial.

    ALL IN THE NAME OF GREED. Without regulations all things are possible. Just ask the greedy.

    April 24, 2010 01:26 pm at 1:26 pm |
  3. hobart

    So Republicans, remind me again, exactly why is it you oppose any and all regulation of this industry?

    Please do tell us how a bailout fund that uses only the banks' own money constitutes "endless taxpayer bailouts?!" Let me guess, you all are so rich and heavily invested in these companies that you don't want one red cent of your dividends to go to such a fund? And the only taxpayer connection is that you yourselves pay some taxes, but the funds at stake are from your expected dividends, rather than from your taxes. Is that pretty much your lame excuse for logic?

    How on earth do you all lie with a straight face, and tell us you represent Main Street, when in fact you represent Wall Street?

    April 24, 2010 01:49 pm at 1:49 pm |
  4. Chuck Anaheim, Ca

    This is why the republicants are opposing the financial reform bill, their rich friends wont be able to rape and pillage the public anymore. Wake up America, don't fall for their same old crap of protecting the CEO and shareholder over the American citizen.

    April 24, 2010 01:52 pm at 1:52 pm |
  5. Jeff Spangler

    We are witnessing the piecemeal exposure of a vast criminal conspiracy, consisting of "affordable housing" policies at Fannie Mae and Freddie Mac, low-doc and no-doc "liar loans" by dumb and greedy mortgage bankers, and time bombs set by deliberately manipulative securitization of these loans and sale of "protection" by smart and greedy folks like GS and AIG. And our government either sanctioned all of it or else was asleep at the regulatory switch. Heads should roll and people should do time, but I'm not holding my breath.

    April 24, 2010 01:56 pm at 1:56 pm |
  6. MCD

    I remember from the 60s... this man would have been called a "Greedhead."

    It's not how you play the game, but rather how much money you can make!

    April 24, 2010 02:04 pm at 2:04 pm |
  7. Denna

    No! Really? They profited from people losing their homes. Wow. All of this went on under the 'watchful' eye of the Rethug party. Anybody miss the Bush years yet? If you do, then you probably profited from the downfall of many Americans. Gotta love those Conservative values.

    April 24, 2010 02:07 pm at 2:07 pm |
  8. jd

    Yes. They knew the reforms the Democrats fought against 2004 on would cause the failure. But you idiots keep blaming one party.

    April 24, 2010 02:16 pm at 2:16 pm |
  9. S Callahan

    Imagine that....and look at this...the only one , so far, being held accountable is a 'middle manager' while they others just glide through and get high end government jobs, essentially protectcing themselves and the evil corporation(s)......Don't worry, there will come a day when each one of you will stand before the Lord and be absolutely accountable to the devestation you have done to individuals and families, buisnesses, etc. .....There will come a day!

    April 24, 2010 02:21 pm at 2:21 pm |
  10. Brandon

    So? They have every right to try and profit in every situation that presents itself.

    If you all are mad about, I suggest you get a life.

    April 24, 2010 02:31 pm at 2:31 pm |
  11. jules sand-perkins

    Of course they made money.
    Goldman Sachs officials went to "business" every day to do "business," so do you think that they did the business in a way designed so that they should LOSE money?

    April 24, 2010 02:37 pm at 2:37 pm |
  12. jules sand-perkins

    Goldman Sachs made money because they weren't gambling blindly with the hope of helping Americans realize their dreams through mortages.
    Professionals! Right, baby!
    Didn't you guys ever hear of professionalism?

    April 24, 2010 02:52 pm at 2:52 pm |
  13. ben san roda

    This is a situation where big companies like GS can do anything no matter the situation is as they are well connected with politicians who are crooks also benefiting from them in the process. I fear it is now impossible to right things when the same politicians are making the new rules.

    April 24, 2010 03:20 pm at 3:20 pm |
  14. ThinkAgain

    The Glass-Steagall needs to be re-instated. That way, these out-of-control gamblers on Wall Street will only have access to investment bank money, put their by others who want to take crazy risks (and they won't have access to savings bank money, put there by people who DON'T have a gambling problem).

    April 24, 2010 03:22 pm at 3:22 pm |
  15. Bob in PA

    duh – and this is illegal ?

    April 24, 2010 03:39 pm at 3:39 pm |
  16. aware2u

    Oops! Obama's buddies will be taken care of but small banks and small businesses won't! :(

    April 24, 2010 03:46 pm at 3:46 pm |
  17. L

    Doing business under today's conservatives is like playing a sports game with no rules, no umpires, no penalties, ....

    It's an insane way to play any game!

    Government plays an important role as the rule maker to keep the game fair. It's sad that the deregulation push of the last 20 years has made it not only possible, but acceptable, to cheat and steal.

    April 24, 2010 03:47 pm at 3:47 pm |
  18. Dick

    I wonder how many Goldman employees are making more money than they are losing now by shorting Goldman stock?

    April 24, 2010 03:52 pm at 3:52 pm |
  19. leanderjim

    Well, I am shocked, shocked I tell you, to learn that there is gambling going on...............just shocked.

    April 24, 2010 04:03 pm at 4:03 pm |
  20. TOTUS FOR PRESIDENT

    Meanwhile, Barack Hussein Obama plays TWO MORE rounds of golf, already outpacing 8 YEARS of George Bush, whose modest amount of play greatly enraged the dangerously whacked out loony lib Dem fringe....

    April 24, 2010 04:09 pm at 4:09 pm |
  21. Anonymous

    Hey don't worry about it. The repos don't want to pass any reform so whats the problem???? Tax payers will pick up slack if we have problems. They are so busy trying to get Obama that they could care less if Sachs screws the whole country. The party of No and they are so proud of it.!!!

    April 24, 2010 04:17 pm at 4:17 pm |
  22. They call me "tater salad"

    Gee!.......Ya think?!

    April 24, 2010 04:29 pm at 4:29 pm |
  23. Leslie

    I hope this issue is not dropped! Goldman-Sachs needs to be held accountable for their selfish acts.

    April 24, 2010 04:37 pm at 4:37 pm |
  24. Sorensen

    If it looks like a crook, sounds like a crook, behaves like a crook,
    lies like a crook, etc. what do you think it is?
    Yes.

    April 24, 2010 04:38 pm at 4:38 pm |
  25. Michael

    In China, criminals like this are simply taken out and shot.
    We could learn a few lessons from the folks who own half our deficit.

    April 24, 2010 04:42 pm at 4:42 pm |
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