Monday, April 26, 2010
Tomorrow the Senate's Permanent Subcommittee on Investigations, chaired by Senator Carl Levin, will hold another hearing on the causes of the financial crisis. This one focuses on The Role of Investment Banks, and every single witness will be from Goldman Sachs. Interest will center on two speakers, Fabrice Tourre, the only individual defendant in the SEC's enforcement action, and Lloyd Blankfein, the CEO.
Last week Goldman posted on its website a 12-page document, Goldman Sachs: Risk Management and the Residential Mortgage Market, in order to, as it said, to put the matter in context. According to Goldman, it "did not engage in some type of massive 'bet' against our clients," it "maintained appropriately high standards with regard to client selection, suitability and disclosure as a market maker and underwriter," and "never created mortgage-related products that were designed to fail."
The hearing should be interesting.