I was going to post something earlier in the week about banker bashing at Goldman Sachs and how Carl levin seemed to be going over the top, but I had flu and I reckoned that it would just be read as an apology for bankers so I passed. However, since the Guardian is running something on similar lines, here goes.
The essence of Mr Levin's charges appears to be that Goldman made less than full disclosure about their own commercial position to customers when selling them assets, and furthermore that Goldman's held a different commercial view on the assets (which Mr levin thinks is wrong).
Both of these statements are of course tosh.
Goldman, or the creator/promoter of any other security, has always had an obligation to provide adequate information to potential purchasers of a security. They have an obligation to be diligent in the preparation of the information, to not mislead or withhold relevant information, but that is as far as it goes. They do not have to think the product is the best - the customer may well share their view. As ever, best advice in business is caveat emptor.
But the second point is more absurd. In business, there is always a difference of view between a buyer and a seller. A seller thinks the sellers are worth less than the cash price, and a buyer thinks they are worth more. That is why the deal goes through. If we all put the same value on every asset, nothing would ever be sold.
Wise up, Mr Levin.