Ignoramus9593 wrote:
On 2010-04-19, Winston wrote:
Let's say that I sell you a product that I know is worthless
and will almost certainly cause you to lose a large amount
of time and money. Let's say that I game the system
so that the product appears to be well regarded and a good
value; I use that to convince you to buy.

Exactly.

Let's say that I sold you a lathe that was made of parts handpicked to
fail, greased with abrasive added to grease, pee instead of oil, etc.

Furthermore, assume that my client actually built this lathe so that
it will fail as early as possible, say to eliminate competition (just
to make this example more realistic).

I know that full well, sell you a lathe like that, and say "here's a
lathe, as far as I know it is great, it runs, but it is sold AS IS".

Then the lathe fails in 2 weeks.

Would I be a fraud? Yes. Would saying something like "but the buyer
considered hilself sophisticated", absolve me from responsibility?
No.


They haven't been charged with, or done, anything criminal.
Goldman also didn't do what your hypothetical implies. At least it doesn't
appear so. You, of all people, should know that.
The deals were done by separate divisions of Goldman by people that had
never even heard of each other, let alone conspired against their customers
and it isn't against the law to for one house to take both sides of the same
deal.
They certainly appear to have a civil problem but they didn't break a single
criminal statute and that's what it takes to end up in prison.
I distinctly recall "a long prison sentence" being mentioned in the original
post.

Unless the civil case uncovers criminal wrong doing, there won't be any jail
time and there shouldn't be.
That might, however, be exactly what happens and at the highest level. It's
starting to look like all of this was orchestrated by GS's executive
officers and management. That's an entirely different kettle of fish and it
is criminal.

All of this is a perfect example of the reason behind keeping insured
deposit instruments and the companies engaged in that financial activity
completely divorced from speculative enterprises/hedge fund activity. When
that isn't done, stealing has been legalized.
That is exactly what has been going on between the law and a concerted
effort not to rigorously enforce laws, rules and regulations that are
already on the books.

Enron, on the other hand, did violate a multitude of criminal statutes.
The first among those was money laundering, not ****ed off investors or
shareholders.

--
John R. Carroll