Lloyd Blankfein, CEO of vampire squid Goldman Sachs, is being grilled about how he's been doing God's work by a congressional committee today:
From Bloomberg: Blankfein Says He Wasn’t Asked to Take AIG Haircut
Reuters: Goldman's Blankfein defends business practices
Huffington Post: I didn't see Blankfein honestly answer one question
Here's some snippets of the questioning from New York Times:
"Mr. Angelides pressed Mr. Blankfein about selling securities tied to subprime mortgages while at the same time betting against them. Mr. Blankfein said he “really needs to explain this because the press swirling around this. Because the firm was accumulating positions, “we have to go out ourselves and source the other side of the transaction,” he said. He said there was no simultaneous selling of securities and then betting against them."
"Mr. Angelides asked Mr. Blankfein what the two most significant instances of negligent behavior by Goldman Sachs. In response, Mr. Blankfein said his firm got caught up in extending more and more leverage to private equity firms and other and, thus contributed to the froth in the market. Mr. Blankfein stops short of saying the firm was negligent."
"Mr. Blankfein said that his firm noticed that lending standards and covenants on large corporate loans were much lower than usual, but that like the rest of the industry, the firm rationalized those looser standards by arguing that the world was getting wealthier and other excuses. “We talked ourselves into a place of complacency,” he said."
"“When was Goldman first alerted to the fact there were serious problems with subprime mortgages?” Mr. Wallison asked. Mr. Blankfein didn’t know exactly when the firm became aware of the the crisis, but he said the firm had turned bearish on housing prices in late 2006 and thought problems in the mortgage market would grow out of declining home prices."
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