Moneybox: Goldman's Perjury Distraction

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moneybox Goldman's Perjury Distraction Did Goldman con the government? Who knows. Did it con its customers? You bet. By Bethany McLean Posted Tuesday, June 14, 2011, at 2:20 PM ET Starting in late 2006, Goldman Sachs made trades that would pay off if the housing market tanked. Was this a massive bet that the housing market was going to crash, as Goldman's critics maintain? Or was it merely a hedge, an attempt by the firm to reduce its risk, as Goldman claims? This debate, which has raged for more than three years, has lately taken on a new significance. Sen. Carl Levin, D-Mich., stops just short of accusing Goldman's top executives of perjury for describing the position as a hedge in their testimony before the Permanent Subcommittee on Investigations, which he chairs. Goldman, for its part, says its executives were telling the truth. To my mind, the perjury question is a distraction. Any claim that Goldman lied to Levin's subcommittee will probably be hard to prove, and, anyway, the subject obscures more fundamental questions about Goldman's behavior. The evidence that Goldman misled the government is murky. The evidence that Goldman misled its customers, on the other hand, is fairly compelling. And if that is indeed the case, then there are suitable remedies. To continue reading, click here. Bethany McLean is a contributing editor at Vanity Fair and the co-author of All the Devils Are Here: The Hidden History of the Financial Crisis. Join the Fray: our reader discussion forum What did you think of this article? POST A MESSAGE | READ MESSAGES Also In Slate Did Goldman Con the Government? Maybe. Did It Con Its Customers? You Bet. Now I Know Why It's So Difficult To Design a Search Engine That's Safe for Kids Coke and Pepsi's Plant-Based Bottles Are Just as Bad for You as Regular Plastics	Advertisement
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