Goldman Sachs and Morgan Stanley are now bank holding companies

[olivegreen]

And what does this mean, she asked...


Breaking News Alert
The New York Times
Sunday, September 21, 2008 -- 9:37 PM ET
-----

Goldman, Morgan to Become Bank Holding Companies

In one of the biggest changes to Wall Street in decades,
Goldman Sachs and Morgan Stanley, the last two independent
investment banks, will become bank holding companies, the
Federal Reserve said Sunday night.

Read More:
http://www.nytimes.com/?emc=na

[metalman]

Re: GGoldman Sachs and Morgan Stanley are now bank holding companies

And what does this mean, she asked...


Breaking News Alert
The New York Times
Sunday, September 21, 2008 -- 9:37 PM ET
-----

Goldman, Morgan to Become Bank Holding Companies

In one of the biggest changes to Wall Street in decades,
Goldman Sachs and Morgan Stanley, the last two independent
investment banks, will become bank holding companies, the
Federal Reserve said Sunday night.

Read More:
http://www.nytimes.com/?emc=na

it means hank's pals are now set up to swallow a pile of other banks' assets on the cheap.

[GRG55]

Re: GGoldman Sachs and Morgan Stanley are now bank holding companies

And what does this mean, she asked...


Breaking News Alert
The New York Times
Sunday, September 21, 2008 -- 9:37 PM ET
-----

Goldman, Morgan to Become Bank Holding Companies

In one of the biggest changes to Wall Street in decades,
Goldman Sachs and Morgan Stanley, the last two independent
investment banks, will become bank holding companies, the
Federal Reserve said Sunday night.

Read More:
http://www.nytimes.com/?emc=na

It confirms what most already suspected...the "temporary" lending facilities the Fed created for the broker/dealers is to become permanent.

"...Being a bank holding company would also give the two access to the discount window of the Federal Reserve. While they have had access to Fed lending facilities in recent months, regulators had planned to take away discount window access in January..."

[olivegreen]

Re: GGoldman Sachs and Morgan Stanley are now bank holding companies

And so they take what they want and eventually walk away... the ones leading the orchestra... i suspect...

How did it ever come to this? I was reading Hudson and one thing he said right off the bat is that futurists never plan on "deconstruction" of a capitalist economy or something like that...

Makes one wonder about the nature of human beings and how we are...

oh well...

OG

[orion]

Re: GGoldman Sachs and Morgan Stanley are now bank holding companies

Oh wait, read the Bloomberg piece;

http://bloomberg.com/apps/news?pid=2...w9g&refer=home

"
The change suggests the inclusion of instruments such as car and student loans, credit-card debt and any other troubled asset. That may force an eventual increase in the size of the package as Democrats and Republicans in Congress negotiate the final legislation with the Bush administration, analysts said.
``The costs of the bailout will be significantly higher than originally considered or acknowledged,'' said Josh Rosner, an analyst with independent research firm Graham Fisher & Co. in New York. ``How, given these changes, can the administration and Federal Reserve believe they are being forthright in their unrevised expectation of future losses?''
In another change today, the Treasury said it would limit its $50 billion plan for insuring money-market funds to those held by investors as of Sept. 19, excluding any subsequent contributions."


Hey I am running out to max all my credit cards and go in debt to the hilt, Yahoo (not really I am throwing up and crying in total disgust of my country ..)

[jtabeb]

Re: GGoldman Sachs and Morgan Stanley are now bank holding companies

Hey I am running out to max all my credit cards and go in debt to the hilt, Yahoo ..)

This is the BRIBE it will take to get J6P to go along with this. "What's good enough for them is good enough for me."

It could all work out very very well, but only in one case.

The debt gets repudiated via all this stupid money printing (inflate all the debts to hell). Then the US accepts a parallel monetary system. FIAT dollars and Gold currency AND allows competition between the two, no taxing gold appreciation for example.

THAT'S THE ONLY way this will end without shots being fired by someone, someday.

[Slimprofits]

Re: Goldman Sachs and Morgan Stanley are now bank holding companies

http://nymag.com/news/business/58094/

Lost in the haze of Goldman’s recent record profits is the fact that the firm nearly went under even after the AIG bailout last fall. As the market continued to plunge and Goldman’s stock price nose-dived, people inside the firm were freaking out, says a former Goldman executive who maintains close ties to the company.

Many of the partners had borrowed against their Goldman stock in order to afford Park Avenue apartments, Hamptons vacation homes, and other accoutrements of the Goldman lifestyle. Margin calls were hitting staffers up and down the offices. The panic was so intense that when the stock dipped to $47 in intraday trading, Blankfein and Gary Cohn, the chief operating officer, came out of the executive suite to hover over traders on the floor, shocking people who’d rarely seen them there. They didn’t want staffers cashing out of their stock holdings and further destroying the share price. (Even so, many did, with $700 million in employee stock liquidated in the first nine months of the crisis.)

Meanwhile, there were huge losses for Goldman’s clients in souring investments, many of which Goldman executives and their network of alumni were also vested in. Its premier hedge fund, Global Alpha, which had already been crushed in 2007, was getting pummeled again. Its Whitehall real-estate funds suffered $2.4 billion in losses, hammering not only clients but also employees, including COO Jon Winkelried. In a panic, Winkelried put his $55 million estate in Nantucket up for sale and likely would have had to liquidate his stock to raise funds. To avoid that outcome, Goldman agreed to buy Winkelried out of his investment, paying him $19.7 million. Another of the higher-ups, the firm’s general counsel Greg Palm, was covered for $38.3 million. (Winkelried has since resigned. His Nantucket estate is still on the market, at a reduced asking price.)

As more employees were hit, the company started a loan program to bail out more than a thousand staffers. Rogers says very few ended up taking loans from the company. Only a handful of people had difficulties, he says. I wouldn’t describe it as a crisis. It was a stressful time for everyone, and some people might have questioned whether they had made the right career choice.

[..]

Salvation came on November 25, a few days after Goldman’s stock price plunged to $52 a share, down from the year’s high of $200 and the lowest price the company had seen since it went public. Again, the white knight was the government. It turned out that Goldman’s conversion to a garden-variety bank-holding company offered an amazing advantage: Goldman now had access to incredibly cheap money. Exploiting its new status, Goldman became the first financial institution to sell $5 billion in government-backed bonds through the Federal Deposit Insurance Corporation, which allowed Goldman to start doing deals when the markets were at a near standstill. Goldman was desperate for it, says a prominent Goldman alumnus. Everybody knows it. Those FDIC notes they got were lifesaving because they couldn’t issue any debt. If it had gone on another week or two, Goldman would have failed, they would have gone the way of Lehman, and you’d be talking about Lloyd the way you talk about [Lehman CEO] Dick Fuld.