Someone recently asked in the comments about the political reach of Goldman Sachs. Here is the first installment.
Simon Johnson, the former International Monetary Fund economist, in his book 13 Bankers, argued that Goldman Sachs and the other large banks had become so close to government in the run-up to the financial crisis that the US was effectively an oligarchy. At least European politicians aren't "bought and paid for" by corporations, as in the US, he says. "Instead what you have in Europe is a shared world-view among the policy elite and the bankers, a shared set of goals and mutual reinforcement of illusions."
This is The Goldman Sachs Project. Put simply, it is to hug governments close. Every business wants to advance its interests with the regulators that can stymie them and the politicians who can give them a tax break, but this is no mere lobbying effort. Goldman is there to provide advice for governments and to provide financing, to send its people into public service and to dangle lucrative jobs in front of people coming out of government. The Project is to create such a deep exchange of people and ideas and money that it is impossible to tell the difference between the public interest and the Goldman Sachs interest.
Read the whole post at The Independent
Goldman Sachs conquers Europe
(h/t Kevin Fathi via email)
Give "the revolving door" new meaning.
Give "the revolving door" new meaning.
Are any of these guys behind the deficit spending that created buildings and aeroports without owners, tenants, and airplanes in Spain ?
ReplyDeleteWhat does MMT say about the excessive construction in Spain fueled by cheap monies which from appearance would be an MMT dream date, but here we are morning after in Spain and there is no one using these "assets" ?
What would MMT say?
ReplyDelete1. Minsky's financial instability hypothesis (recently promoted to a a law). Low borrowing cost is never the major problem. Low rates don't force either lending or borrowing. The borrowing cost is one one consideration among many. The problem is imprudence.
2. It's the demand, stupid. If you are going to build out, you had better be sure that the effective demand is available to support it.
OK that's right
ReplyDeleteThe demand was forecasted by same brilliant folks who governed and implemented the derivative equations of the glorious quant financial engineers.
It's the derivatives, stupid