Matt Taibbi on where we are with a Goldman Sachs prosecution

Great update from Matt Taibbi, referencing his recent article on a possible Goldman Sachs prosecution in Rolling Stone (link here). The interviewer is Sam Seder of Majority.fm.

I’m presenting this not just for the news, but for the great explanation of what was actually illegal about the housing bubble — how it got pumped up (starting 8:13 in the clip) — and just what Goldman did to defraud its own customers (12:00).

Note the mention of hedge fund king John Paulson at 20:00 in the interview. He’s the guy who got Goldman to create Abacus, a toxic derivative designed to fail, so he could short it.

Seriously — Paulson asked Goldman to create Abacus, which they then sold as “good” to to their other customers, so Paulson could bet against it. They not only did that for him (he was apparently a better customer than the rubes they sold Abacus to); they allowed Paulson to suggest which mortgages Abacus should contain. Stunning.

John Paulson’s also the guy we talked about here. Funny how that works, money and corruption. And Paulson still walk the streets.

A transcript of the interview is here. A lot to digest. There may not be fire, but there’s plenty of smoke. Good on Sen. Levin and the Senate Investigations Committee for fanning it. Let’s see where it leads.

GP


Gaius Publius is a professional writer living on the West Coast of the United States.

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