Published on 11 Aug 2009

Paulson and Goldman Sachs: the plot thickens…

The film on the backlash against Goldman Sachs is top of our most-viewed charts.

To catch-up on the backstory read here, and it’s well worth seeing the film here, if only to see lightning burst out of the sky above Goldman’s new HQ in Manhattan.

But the plot has thickened over the connections between the former US Treasury Secretary Hank Paulson and his former company Goldman Sachs. It centres on the decision made to bailout AIG, which saw some $13 billion of US taxpayers money go to Goldman, its biggest counterparty. On this blog last week I wrote:

‘Fascinatingly, Mr Paulson was aware of the potential for a conflict of interest in those decisions so he went to the lawyers. “It would have been wrong to rescue myself, so I got a waiver from the ethics agreement from the Government ethics office,” he recently told Congress, in little-reported remarks.

That waiver has now been published here after sterling investigative work from the New York Times. It can be viewed here

It was granted by a White House counsel on the day of the decision about AIG, which is not the normal course of events according to the New York Times. The newspaper also found out through freedom of information about the disproportionate number of telephone calls being made by Paulson to Lloyd Blankfein, Goldman’s CEO at the time of the bailout.

Two things I would draw from this. First, why don’t we have similar disclosures about the UK bailouts? Second, Hank Paulson’s forthcoming book should make for rather interesting reading.

2 reader comments

  1. Dennis Junior says:

    Faisal:

    Yes, the Plot thickens between Paulson and Goldman Sachs….Because, there WAS some backroom deals that were hatched that were not accepted ….

    NB: I am not affiliated/associated with either side, and not making any allegations….

    =Dennis Junior=

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