Epstein's analysis

Reader comment on: Edward Jay Epstein on Goldman Sachs and the SEC

Submitted by J.Johnson (United States), Apr 28, 2010 15:12

Epstein's entire argument collapses if Goldman actually did not, as it claims, lose many millions of dollars on the deal. Despite the SEC's incredible past incompetence, it is hard to believe that they could have missed, or deliberately left out, this extremely relevant fact from their complaint. Moreover, at the time of this deal, Goldman had already turned negative and was shorting the housing market, so it is not at all clear why they would reverse direction and go long in the Paulson deal.

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The Future of Capitalism replies:

The accusation by some of the senators yesterday was that Goldman wanted to unload its share of the long position but couldn't find a buyer. The fact that they wanted to get net short or "closer to home" as they claim doesn't mean that they didn't have individual long positions as they did here.

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