ΒιΆΉΤΌΕΔ

How much did RBS eventually lose from this deal, and will they sue GS to recover any outstanding losses and reimburse UK taxpayers?
Will the FSA investigate/censure GS over this incident?
How many more cases like this of mis-sold CDO's are there out there waiting to be discovered?

Mr Peston
As you say, "every little helps". You could have said "look after the pennies and the pounds will look after themselves".
The RBS directors have duties to shareholders, as well as others. Yet they didn't even know of this "cashback". G Sachs admit they gave "incomplete" info to clients - we should all remember this duty.
Β£100M for free - try telling this to the jobless, single parent families and students! Β£100m can buy approx 30,000 free student fees.
Get real please - exchange your "generous" ΒιΆΉΤΌΕΔ lifestyle for a less fortunate person's for a month (remember your advice on BB3 recently)
Oh-and let us know how much RBS legals are paid for "chasing" any more !

I think we need to follow the logic associated with the oil-spill in the Gulf. The polluter pays.

This judgement suggests to me that certain financial institutions which can be named have played a strong hand in facilitating the destruction of the global economy. So can we have ALL our money back, please?

This is a polite and respectful request. If the money is not forthcoming then we will have to take a different, more robust approach.

It is rather odd that between businesses the idea that they should act in the utmost good faith does not exist. After all this is exactly the condition of contracts for things like insurance between the little people and the financial institutions. If one of us, the little people, had acted in this way (and had the gigantic assets with which to pay for the legal team!) we would have been in prison for dishonesty and fraud - even fiddling your expenses can land you jail, but deliberate acts that set out to do what Goldmans did is not even properly prosecuted. There really is something rotten at the core of the judicial and legal system when this disparity exists.

The answer, of course, is to break up Goldmans and all similar institutions that are too big and to prevent then from acting in concert with others to perpetrate and promote such deals in the future. The penalty being life imprisonment for the people concerned and the directors of the company and an unlimited confiscatory fine. All deals must be publicly traded on an exchange - all back-door (over the counter) deals must cease. Will we do it?

Why do IKB get all their money back, but RBS only get $100m out of $841m?

Better than nothing I guess.

Sounds like more transatlantic politics to me ... with the UK as the 'loser'

3 & 4 Well said!

GS should be squeezed for every penny - where are the risk assessments for all of these products they were selling.

HMG should demand that Goldman pays $20Bn into and escrow account to pay claims for all of those affected by their actions - now! $100M is just the start!

'Goldman Sachs agrees record $550m fine'

The headline to this story says it all.

We know that the banks are still more powerful than democratic governments when we allow them to negotiate their punishment.

Almost 2 years on from Lehmens - have things really changed?

annus horribilis for Goldman Sachs? well it certainly is not annus horror bills for them. As for RBS who apparently are chuffed at getting back less than one eighth of the Β£841M sting is this a case of a lack of due diligence that Fred the Shred should answer for. Taking one of the world's biggest banks for a multi-million pound ride might a bit of a hoot but what does this and all the other internecine trickery mean in terms of financial stability and the effects on the wider economy. It demonstrates that banks and financial institutions needs public accountability and supervision not regulation PDQ.

Is not the Goldman Sachs episode the unacceptable face of capitalism?

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While plea-bargaining and the arranging of financial settlements with the regulator have a major role to play in alleged financial crime, the 'pay-off' mechanism should absolutely not be used as the only tool in the box.

Every now and again a case should be taken all the way through the courts.

And generally speaking the bigger the case the better, if the regulators really want to modify behaviour in the market-place. So this definitely should have been one of them.

Otherwise:
- everyone playing the game simply cannot understand where exactly a player has gone wrong and what they must not do next time if they want to stay inside the law
- the law will be brought into disrepute for only applying to those without money, while those with money can live their whole life supposedly stain-free with "no implication of any guilt".
- companies will simply build up regulatory pay-off funds as part of a "normal" course of business.

Goldman has not admitted the charge, but it has acknowledged that marketing material for the CDO was "incomplete"

This must be a new meaning to the word incomplete that I have not yet come across. Its rather like that other favourite "being economical with the actuality!"

Within three hours of the fine, the Goldman Sachs share priceincrease had paid it for them. RBS, meanwhile, gets 10cents on the dollar.

Nice work if you can get it.
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I am with #7 Start Again

BP have been forced to set aside $20 Billion to cover ALL COSTS!

Livelihoods have been lossed in the US due to the oil spill, but much more have been lossed around the globe due to the toxic cr*p enleashed by Wall Street (and London)!

Where is the Anti-Banking rhetoric from Obama?

Why is Obama not promising to put 'the boot to neck' of Goldmans?

Why is he not looking to find 'who's a** to kick'?

I bet being sold a dodgy product never tarnished the relationship between GS and RBS. I am sure RBS still use GS for many many of their services. If your mechanic told you he serviced your car, but it turns out that he put in old parts from his mates car and mislead you, would you go back to him?

Interesting extract from an article in the Telegraph written on 20/04/10.

"Goldman has been one of the Government’s most trusted advisers, particularly during the financial crisis when it advised the Treasury on the nationalisation of Northern Rock. The bank is on a roster of approved advisers to help the Government with its debt issuance. Banks are eyeing hefty fees when the Government sells its stakes in Northern Rock, Royal Bank of Scotland and Lloyds Banking Group. Other state-owned assets that are expected to be sold include stakes in the Tote bookmaker, the Student Loans Company and the Channel Tunnel rail link."



GS has done over others in the past too, under the premise of being a key partner to their objectives.

Extract from GS website

"* Q. Does Goldman see any conflicts in the fact that it offers countries like Greece financial advice and help raising funds in the capital markets while also simultaneously engaging in trades that profit from financial woes in those same countries? Does Goldman have internal guidelines detailing when the firm can take negative trading positions on the debt of sovereign entities when Goldman is also advising those states?

* A. We have an obligation to our shareholders and, more broadly, to the financial system, to manage our business prudently. We, and other financial institutions, aggregate our risk exposure and hedging. This is considered prudent risk management. The fact that we may hedge our exposure is well known to our clients.

Implicit in the question is the suggestion that we have been β€œshorting” Greece. We have, in fact, had a generally net β€œlong” bias in our exposure to Greece for a number of years, and that has also been the case recently."



Goldman Sachs has its grubby mits in every pie going. Isn't it about time we dismantled this syndicate of deceit and lies? Bankrupt it, and let its 'shareholders' foot the bill, who it claims it is working on behalf of.

If BP can be banned for 7 years from deep sea drilling - Goldman et al should be banned from trading derivatives!

I am not defending BP, but the Banks were spreading their toxic rubbish on purpose!

5. At 09:37am on 16 Jul 2010, Scott wrote:
Why do IKB get all their money back, but RBS only get $100m out of $841m?

Better than nothing I guess.

-------------------------------------------------------------------------

Because IKB was bailed out partly by the state and partly by Germany's two largest banks (Deutsche and Commerzbank). So they have a stronger incentive to recoup losses, unlike the RBS which is owned by UK PLC, which has no incentive to repay the taxpayer.

15. At 10:58am on 16 Jul 2010, newblogger wrote:
I am with #7 Start Again

BP have been forced to set aside $20 Billion to cover ALL COSTS!

Livelihoods have been lossed in the US due to the oil spill, but much more have been lossed around the globe due to the toxic cr*p enleashed by Wall Street (and London)!

Where is the Anti-Banking rhetoric from Obama?

Why is Obama not promising to put 'the boot to neck' of Goldmans?

Why is he not looking to find 'who's a** to kick'?

-------------------------------------------------------------------------

Because Obama is simply a sheep in wolve's clothing. His popularity is waning desperately, and therefore to underpin his support, he will push any agenda that looks like it is protecting US interests and makes him look like a protector of the US. He has no real might, its all spin.

Caveat emptor

What happened to due diligence when IKB & RBS bought the Goldman CDOs?

Perhaps they lost in the same black hole that Clegg, Cable et al have put their consciences.

Derisory fine.

In what way is this "woe" for Goldmans? $500m is small fry to them, they would hand out over a billion in bonuses alone each year. I think Goldman will see this as a result.

When are the banks going to start to be punished for the fiasco of the last 3 years (built on the disastrous deregulatoin of the previous 2 decades?) Nothing has changed since 2007 and the "financial crisis" (which we are still in by the way), no lessons have been learned and no-one has been punished. Au contraire, the banks have benefited from the incredible largesse of governments and the huge generosity of central banks in cutting interests rates for them.

And before anyone says "the banks had to go to zero interest rates to protect the economey", then where is this low interest rate happening in the real economy? Banks are borrowing at 0.5% (or getting money for free from "Quantitative Easing") and lending it out at 5, 5, 7% or 25% on credit cards.

The public have been fleeced so many times in the last 3 years (and that on top of the pillage of the last 2 decades). Yet the public docilely sit there and take it.

Bankers are laughing all the way to the ...err.. bank.

#16

Good post.

Very few people realise the decision to bail out the banks was BASED on the advise from the bankers!

Not a bad afternoon for Golden Taps, fined $550m market cap goes up by $800m so a $250M profit on the day. You couldn't make this stuff up, nobody would believe you.

As far as I can see nobody but Goldman Sachs benefits from this decision. Certainly RBS and other institutions affected by this scam will get back nothing like the sums they lost. On the whole, though, we all lose from this. As GS will not now be taken to court, no one will be found to be liable or personally responsible for the financially irresponsible actions involved. It will become obvious that we have learned absolutely nothing from the crash of 2 years ago when a lack of personal responsibility made a significant contribution to the devil-may-care attitude of the banks.
We desperately need cases like this one to go through full legal process.

"In respect of the deal in isolation, $550m looks like a hefty fine. But it is only 1.2% of Goldman's net revenues last year of $45.2bn and just 3.4% of bonuses and salaries paid to staff."

Good to see justice in action, if you commit crimes it OK as long as you can afford to pay your way out of it. This will not sit well with the American people.

"This may make you chuckle: apparently Royal Bank of Scotland had no idea it was in line for a slug of the SEC penalties paid by Goldman, so it regards the $100m it has netted as something of a windfall."

Good to see those bankers are as sharp as ever - isn't it great that such highly paod people are so unbelievably incompetent. Still, I guess compared to the last lot - they actually are a vast improvement!

10. At 10:28am on 16 Jul 2010, ARHReading wrote:

"Is not the Goldman Sachs episode the unacceptable face of capitalism?"

I hear about the unacceptable face all the time - when was, or when will be the acceptable face of Capitalism?

''Incomplete'' .

Oooooooooh!! That could come back to bite Goldman Sachs. Linguistics is maybe a flaw in the GS diamond.

Companies all over must be reaching for their yellowing pages for the local wordsmith.
[wink1]

Define ''complete''(in a financial/business context).
[wink2]

Slapped wrist for GS then. Good article.

Goldman's boy Obama done good.

After all that has happened over the last three years...evil wins again!

The Great American Bubble Machine

On the day that President Obama presents the world with his new financial regulations which will bring an end to"shadowy deals" it is announced that Goldman Sachs will pay a fine that will have about as much impact on its finances as buying a cup of tea would for the millions of ordinary people affected by the collapse of world markets.
Even by American standards this takes some beating.They scream, threaten,badger,force extradition (remember RBS employees)when they perceive any form of wrongdoing or act which might affect their cozy existence but have no regard for the "so-called" special relationship with the UK.They cannot even be bothered to be seen to be doing the right thing.What would have happened the other way round? They would have probably seized their assets (sorry,my mistake the people's assets).
Clearly,I should have stayed in bed this morning!

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Risk Analyst & Newblogger

"Because Obama is simply a sheep in wolve's clothing. His popularity is waning desperately, and therefore to underpin his support, he will push any agenda that looks like it is protecting US interests and makes him look like a protector of the US. He has no real might, its all spin."

I actually think there is more to it than just Obama's popularity. America is in a real mess (that's not to say the rest of us aren't) - it's in a depression, it is drowning in debt, it's citizens are yet to feel the full force of the loss of it's economic pre-eminence, they have got used to having anything they want - and paying for it with USD which has lost it's lustre. So, they will grab foreign wealth/assets given any opportunity (this is not to say that BP shouldn't pay for the clean up etc. of course it should) - expect to see more of this.

We should tread carefully and need to re-evaluate our one sided relationship with the USA

".....Wall Street's history demonstrates that in the ruthless pursuit of profit, few firms on the planet are more adaptable."

Ruthless indeed! This, supposedly "respectable" bank deliberately set out to "pull the wool over," a competitor. However, what I'd like to hear from RBS is that they accept, as part of the game, that one of their "respectable" opposite numbers will attempt to rip them off and they just have to be clever enough to see through it. However, the piece above talks of RBS mounting further legal challenges. Presumably for no reason other than because that's part of the game? Or is it because GS actually went too far?

That may seem to be all right between banks. But it isn't when their trash spills out onto the rest of us!

Some talk has all been about (fiddling round the edges with) new Regulation and a bit of new regulation is just coming through the US Senate.

We need to reinforce the idea, in banking certainly, that Respectable and Ruthless are completely incompatible. Banker mentality needs to be changed. They can't have both respectable AND ruthless under the same roof!

I'm thinking in terms of The High Street. It's bad enough that one bank is able to fleece one of their peers in such a manner. But one bank against an ordinary Joe Bloggs customer? Sorry, that's a totally unacceptable and unfair position. The bank "holds all the cards." So the consumer should have ALL the consumer protection - even the presumption of bank guilt as the DEFAULT position. Caveat Emptor cannot possibly apply to products which amount to being dozens and dozens of legal conditions. Effectively conditions which relieve you of your common law rights to put the bank in a position of strength in court.

Or legally all bank shares must be Unlimited Liability in future, with Directors, by law, becoming shareholders within months of appointment.

Economic Meltdown and millions of ruined lives - just because a few eggheads want to do "Ruthless pursuit of Profit?" And we then let them off too??? People should realise it's not just how it used to be. It's STILL like that TODAY and it's simply Wrong! Where are our politicians? They need to stop talking and end this widespread immorality.

Profit from this and buy GS stock.

6. At 09:47am on 16 Jul 2010, nautonier wrote:
Sounds like more transatlantic politics to me ... with the UK as the 'loser'
------------------------------

You're close but not there. The kingdom owned by the monarchy is not the loser here, it's us, the "subjects" in it, that are the REAL losers!

The differing treatments of BP v Goldman Sachs are well documented above. I have emailed 10 Downing Street asking for strong representation to get the full amount back for the UK taxpayer from this 'fraud' which was deliberate and intentional or Goldman Sachs to be removed from any future Govt tender list.

Can I suggest others do so also.

Think about it...

American company Goldman Sachs get fined $550 million for knowingly polluting the world with toxic debt

BP a British company get fined (we know not the amount yet), but pay $20 billion (and maybe more) into an Escrow account to deal with losses suffered by the Americans for an accidental blow up of an oil rig (operated by American companies) and also face a ban from drilling for oil for 7 years (but the lawmakers only seem to be getting at BP, not American companies).

American justice?

16. At 11:04am on 16 Jul 2010, RiskAnalyst

Very interesting what Goldman have on their website - allow me to translate (no, not into a foreign language, I've had enough of that)

* A. We have an obligation to our shareholders (The fund managers and hedge fund managers we went to school with who you the people trusted their pensions to) and, more broadly, to the financial system (the 'host' we nearly killed), to manage our business prudently.(make as much profit as possible) We, and other financial institutions,(our friends and ex-college mates) aggregate our risk exposure and hedging.(all bet the same way) This is considered prudent risk management.(by the people who failed to assess the biggest risk of all) The fact that we may hedge our exposure is well known to our clients. (they know we hedge, but we didn't tell them what and when)

What a load of marketing nonsense, anyone would think that the credit crunch never even happened.

The ruling (criminal) class of government and wealth have a different set of rules and they pay fines for what others would be jailed for. This is a transfer of funds for banking to government and as usual left out those who actually lost money. There has been no discussion whatsoever about credits or other instruments to provide for those who lost retirement accounts or pension funds. As everyone assumed and apparently everyone knew but the governmental regulators and politicians, the system was a scam. The governments continue to treat this as a banking problem rather than a theft. The injured parties have been abandoned and their lossses are theirs alone but the governments and banks will pretend that things have changed. The economies will continue to struggle because the money taken from the people, that would be spent on purchases remains unaddressed. They never understand until the collapse. Simply another betrayal of the people by the powerful.

GS are getting off light.

Whose being offered Jobs then ?

How easy it is to be Cynical these days !

What we need is a proper champion of the balance, someone to restore fairdealing and commonsense to the financial system.

Fairdealing ? Is that such an unreasonable expectation ?

Isn't Law and the Right to Govern tied up with grandiose claims to Fairness ?

Shame the Bradford and Bingley Shareholders weren't treated fairly. Will they be compensated for dodgy Bonds sold to their firm ?

Oh wait a certain man has already written them off, arbitrarily ignoring all of their reasoned arguments.

Shameful.

I'm here for at least the next two years, well a bit less now.

# 25 - Capitalism is a bit like democracy - it is not perfect but there is probably nothing better.

36. At 1:18pm on 16 Jul 2010, Basildon Dan

I'm sorry but the American's have always followed American interests - it's just that sometimes the UK's interests are shared, making it look like their acting in our interests.

Just look at how they're dealing with the Yuan situation - trying to goad China into either a trade war, or a real war - so they can dominate world politics once more.

They don't know any other way - I mean don't forget they only entered the war in 1942 because their interests in the Pacific were under threat - our salvation never even came into it.

This is what happens when your society is based on free market self-interest. The biggest threat they face is that they are almost on their own - their past history has not helped them make friends.

This is reflective of the state, not of the people however. Most Americans are decent people who simply want to be productive and useful in their lives - just as the Government of the UK is not reflective of it's people (unless the average person can afford the sorts of sums Zac Goldsmith is alleged to have spent in his campaign to gain a seat)

" 28. At 12:01pm on 16 Jul 2010, DebtJuggler wrote:
Goldman's boy Obama done good.

After all that has happened over the last three years...evil wins again!"

-------------------------------------------------------------------
Evil plays with a rigged Deck of Cards, or in this case, rigged markets.

So called Free Markets in Stock sense, have merely enabled other countries stock markets to be more easily manipulated by the few (wall street bankers), to the detriment of the many (the ordinary people).

Seriously restrictions and limits (in the trade of financial products, shares derivatives etc) are they only way to reduce the risk of them pulling the same stunt all over again in another twenty years or so, when their next batch of Sheep are ready for shearing.

Forget Pension Funds, whilst things stand as they are, these Wall Street creatures will rob them again.

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There is quite a thoughtful expression of good and evil in the intro to Tales of terror and the supernatural.

Ah, Investment Bankers pawns of darkness !

20. At 11:20am on 16 Jul 2010, twinturbo wrote:

'Caveat emptor

What happened to due diligence when IKB & RBS bought the Goldman CDOs?'

This is the excuse Goldman used initially, but Caveat Emptor does not apply when the level of misinformation amounts to fraud.

You are correct though, it is a derisory fine.

With regards to Paulson and Co, are they being investigated yet?

I understand as a hedgie they are not regulated by the SEC, but why has the SFO not been involved yet?

Is this going to cause the Goldman giant vampire squid to release its grip ion the face of humanity, or to stop jabbing away with its blood funnel? Not one bit.

Compare Bhopal, Deep Horizon, and the Credit Crunch and decide which of the following factors dictate the outcome in a world run by the American Empire: justice, morality, effect on global welfare, or whether or not the crime can be pinned on someone other than the Yanks, and whether it's thousands of non-Americans or a handful of Yanks that have been killed or had their livelihoods ruined.

Ok, so RBS lost ~$850m and only get back $100m??? This is crazy, GS got back every dime from AIG. Something is seriously wrong here!!! Now I know what the G in GB stands for - Grape, that's because Britain always gets squashed when it comes to fighting it's corner.

Oh yeah, and was it God's work to settle the claim!!!

"40. At 1:38pm on 16 Jul 2010, ARHReading wrote:
# 25 - Capitalism is a bit like democracy - it is not perfect but there is probably nothing better."

Given that since it was created 100's of years ago, before computers, the internet etc, I think your being a bit quick to conclude there is nothing better. Afterall unlike the laws of physics, we have actually created it ourselves, and therefore we can change it if we have a mind to. I think vested interests are the only reason it has persisted for so long.

#41 WOTW

I agree with you sentiment regarding the US and their motives - although I wouldn't feel too sorry for the Chinese they have their own global domination agenda that is equally sinister.

We are entering a new phase of global power - it's going to look like the Risk board with continental power blocks coming to the fore - in which case we should re-think our stand offish attitude to Europe. many around the world would be happy to see the decline of Europe including Britain. Old colonial scores to settle.

On WW2 - don't forget the USSR ws also happy to stand back and watch until it was attacked. It was only Britain (plus Empire) and France that was prepared to stand up for another without having being attacked first.

49. At 3:43pm on 16 Jul 2010, DoingGodsWork wrote:

"Oh yeah, and was it God's work to settle the claim!!!"

I think the Goldman boss was misquoted - I think he actually said "Doing dogs work".

You know, sniffing each others behinds in the hope of a legover in the park, cocking your leg and doing your business anywhere you please, running around causing havoc and not having your collar on so you cannot be identified.

...oh and of course barking very loudly to scare little children (aka politicians) when you're scared that you (the owner) might put them out in the garden all night for doing your business all over the carpet when you've got guests coming round.

I say they all need some Barbara Woodhouse style training.

No, Mr Peston the real chuckle is that GS shares rose on the 'good' news. ΒιΆΉΤΌΕΔ Radio News reported that the markets had perceived them as 'getting off lightly'.
They know a thing or two those markets. Hi Ho, back to work tending the magic money tree. No harm done.

this reminds me of the story 'David and Goliath' but with a sad ending. i call upon the Count of Montecristo to sort GS out. i have completely lost faith in the judgment of the legal system, governments, regulators, etc. it seems reality is just much too evil and painful.

Chasing profits throws caution to the wind - does this sound familiar?

"Risks created by these industries must be managed effectively because when things go wrong in this sector, the consequences are severe.

"It can destroy lives, shatter local communities and cause damage to the environment which can last for generations."

...not banks, oil companies....

/news/uk-england-10660356

51. At 4:23pm on 16 Jul 2010, StartAgain

True, but....

"On WW2 - don't forget the USSR ws also happy to stand back and watch until it was attacked. It was only Britain (plus Empire) and France that was prepared to stand up for another without having being attacked first. "

I think the USSR was still in a state of internal conflict following the revolution and that they might have had it marginally worse in WWI than we did (although I am open to correction)

What is the burgling of a bank (compared) to the founding of a bank?

Bertold Brecht (1928)

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I forgot to add....great post stanilic....I agree with every word you wrote.

It's difficult not to feel cynical about the whole affair. After all, turkeys don't vote for Christmas.

One would have expected serious criminal proceedings and a bloody corporate nose. Instead we got a limp slap on the wrist for what was, to all intents and purposes, fraud on a grand scale.

Certainly this was a let-off for Sachs, seemingly a good day for the banks and another example, if one were needed, of just how ineffective reform of the dicredited banking model has been.

I don't go in for the easy yank bashing though I do see the hypocrisy in the parallels with the BP incident. Might is right, politics, Christmas and turkeys... as I said, difficult not to feel a bit cynical about it all.

"This may make you chuckle: apparently Royal Bank of Scotland had no idea it was in line for a slug of the SEC penalties paid by Goldman, so it regards the $100m it has netted as something of a windfall.

And RBS's lawyers continue to review whether it has a case for independent legal action against Goldman to recover the rest of that $841m.

RBS would argue that it hasn't been short changed by the SEC settlement with Goldman, but that the $100m is a lottery win (well, almost)."


At the moment, I have Β£3000 in an RBS savings account. Should I find a job, this will (barely) fund moving so I can accept it. So it's really good to have this example of just how serious they are about their responsibilities when handling other people's money. Thank God they're not running the Health Service.

Chuckle? No - this makes me bloody furious.

56 wotw

"I think the USSR was still in a state of internal conflict following the revolution and that they might have had it marginally worse in WWI than we did (although I am open to correction)"

WW1 Deaths

GB & Ireland 994k 2.19% of pop.
France 1.7M 4.3% of pop.
Russian Empire 3.3M 1.89% of pop.

So, on sheer numbers yes they had it worse, as a percentage loss of population that is a different matter although I am sure it was equally horrific whichever side you were fighting on. A trip to Verdun really brought home the sacrifice of life and an understanding of why there was little fight in the French come 1940.

Interestingly (depressingly)-

Italy 1.24M 3.48% of pop.
Romania 680K 9.07% of pop.
Serbia 725K 16.11% of pop.

Okay that's an end to the history blog! Apologies business fans.

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Robert:

I have a strong thought that Wall Street will rise once again, and, no comment about Goldman Sachs ....

(D)

RBS is considering it's options! What is there to consider Goldman has just been fined an enormous amount.They must be sitting ducks and RBS should bring an action under the 'Racketer Influenced and Corrupt Organisation' statute.Under this they could claim massive punitative damages.Also the top American lawyers would be lining up to handle the case for free,inexchange for 30% of any award.

RBS loses, basically got mugged of $841m and they consider Β£100m to be wonderful re-compense and a reason to jump for joy.

The USA is a big peanut producer, they have basically flicked some peanuts at RBS, still, what do RBS have to worry about, they have been provided with Β£billions of UK taxpayers money without having to employ a single lawyer.

I think the main reason why RBS are NOT rushing to seek compensation and return in full, is because it will enevitably and ultimately uncover MASSIVE incompetance within RBS resulting in their present UK taxpayer ownership, after all, they have a history of incompetance which led them into their current financial troubles, hence how can others be made liable for endemic incompetant or deceitful/fraudulent malpractice practice when the victim itself has an unreliable and terrible history.

One of the first lesson in commerce/business, even at secondary school is learning a pretty important piece of latin.

Namely: Caveat emptor

Let the buyer beware,

which is not just associated with consumers or property deals but in ALL things.

Thing is, those in RBS who made such negligent decisions were NOT using their own money, so why should they care, they still got massive payoffs and pensions entitlements, apparantly, a just reward for losing Β£BILLIONS!!!!!!!!!!!!!!

Goldman and Wallstreet may rise again, but not in Europe.
Not even the biggest fine every imposed by the SEC will stop the EU from saying NO MORE to Goldman Sachs: NO MORE to Goldman-Sachs having anything to do with future sovereign bond sales.
Financial persons have been shocked regarding the past financial transactions among Goldman, Greece and Italy. Products were designed by Goldman-Sachs to hide government debt. Greece used Goldman in a bond sale this year, and now is all but one step away from pursuing legal action against Goldman.
Spain has not dealt with Goldman Sachs in 2010;
Italy has not given the bank a leading role since 2007.
France has not used Goldman over the past three years.
Goldman has been criticised for taking short bets, or betting on a price decline against some European sovereign bonds. Goldman-Sachs calls such shenanigans "a mistake". I have better words for it.
Goldman maintains some dealings with Britain, Portugal and Belgium; all I can say to these countries is CAUTION.
The French treasury now only issues debt in euros; like Spain it stays far away from the complex foreign exchange/swap deals that brought trouble to Greece and Italy. European Governments now seem to want to stick to open, transparent simplicity in order to keep their prized AAA ratings.
IKB, the failed bank bailed out by the German government, is still considering suing Goldman because of its exposure to the structured products sold by the US Investment bank. Following the settlement between Goldman and the SEC, IKB said the German lender was "reviewing the settlement documents carefully".
Royal Bank of Scotland, awarded a pathetic $100M in the $550M settlement agreed to by the SEC, is considering options to sue Goldman for the full $841M in losses which its acquisition, the Dutch Bank ABN Amro, lost in the Abacus deal.
The Abacus deal had two prime suckers:
1. ABN Amro the Dutch Bank, a previous player in the housing mortgage CDO market (got sold the bigger chunk of the synthetic CDO’s worth $841M) and
2. the German Bank IKB had bought CDO's of $150M.
The buyers of ABN Amro have been offered a measly $100M as compensation.
Both ABN Amro as well as IKB have reserved the right to consider legal action against Goldman Sachs; this may well be done in an EU court.
The SEC settlement is pretty stinky WHEN viewed from the angle of settlement to the aggrieved investors.
The SEC has allowed Goldman to
1. avoid tough penalties as well as
2. an admission of guilt.
Goldman was allowed to say: it had made a mistake. It did not inform investors that the mortgages contained in the CDO package had been picked with the help and guidance of the hedge fund firm Paulson & Co. and that Paulson & Co. had bet against the bonds.
This "mistake" led to the two European Banks loosing at least one billion; this was the sum originally charged against Goldman, but somehow it evaporated to $550M.
However, there is good news:
The judge who approved the Sec settlement OR any EU court may call for full compensation to victims including interests and associated administrative costs.
ABN Amro collapsed under CDO losses; ABN AMRO had been one of the leading Banks of Europe. It had operations in 63 nations. I doubt that we've seen the last of ABN Amro vs. Goldman Sachs.
Regardless of the 4.4% jump in Goldman stocks, it's clear to me that we've also not heard the last of Abacus deal.
ABN Amro, owned now by a consortium consisting of RBS Bank and the Netherlands Government (and shareholders) can take action against Goldman in the EU courts, and the EU courts are not easily manipulated. Lastly, I heard that Senator Levin is leading the Senate committee investigations; apparently it has enough documents & evidence to start even more actions against Goldman-Sachs for creating the misleading instruments and then betting on the structured products.

Well put - amazed that did not get moderated (out)

How about sorting this with some imaginative accounting? BP can pay the next Β£741m to RBS, and so settle the books without having to stick extra postage on it to go to the US.

The fines should have killed Goldman Sachs. This was a clever scam with clever victims. Goldman's argument that the sophisticated victims should have seen what they were getting into was outrageous.

Interesting to see the latest profits for Goldmans Sachs are well down, they may find that their reputation is now tarnished and wise investors should exercise caution and steer clear of a company that was recently forced to pay compensation to it's customers - They may be the next unfortunates
After all even if I was a sophisticated customer that bought a service or goods that had "issues" known to the Trader but not declared I would be very reluctant to do any form of repeat business or make positive recommendations to friends or colleagues - or am I naive

By announcing a drop in profits, it does not resolve much in the way of compensating RBS (and the British taxpayer) for the full amount. And come on, it was on the cards for a drop in profits. If they announced an increase, it would only attract more publicity - good tactics GS.

Anyway, if they are starting to see a decline in their business lines, then it's down to "what goes around comes around..."

When you do God's work unlawfully, God has to punish!!!