Goldman Sac(h)s America

The stock market recently enjoyed a huge rally on the back of the latest earnings statement from Wall Street's premier company - Goldman Sachs. Goldman Sachs is also known among its critics as 'Government Sachs' for the firm's close ties to the Treasury department and the Federal Reserve.

Wall Street was celebrating the return of "business as usual" for them as evidenced by Goldman's results. Goldman Sachs "earned" $3.44 billion for their fiscal second quarter, up 65% from last year.

One should recall that Goldman Sachs was "bailed out" with $10 billion of taxpayers' money last fall. Goldman Sachs also received directly another $13 billion of taxpayers' money from the government's bail out of AIG. Goldman Sachs also had $28 billion of their debt insured by the FDIC - Federal Deposit Insurance Corporation - that normally insures bank deposits.

So what does Goldman Sachs give the taxpayers as a "thank you"? A hard slap in the face! The company has set aside 33% more (as compaed to last year) for compensation to its employees.

Goldman Sachs set aside $6.6 billion for employee compensation for this quarter and a total of $11.3 billion for employee compensation for the first six months of 2009. Goldman Sachs can do this legally now because they paid back the $10 billion government TARP "loan" last month.

Estimates are that Goldman Sachs will set aside enough to reward its 28,000 employees about $700,000 per employee. Obviously, the top producers will earn much more. Where is the "change", when it comes to Wall Street?

Besides being extremely well connected to the US government, what other factors allow Goldman Sachs to always do so well? A recent news story may shed light on that.

An ex-Goldman Sachs computer programmer, Sergey Aleynikov, was arrested for theft of a software trading program from Goldman Sachs. He intended to sell it to Goldman Sachs' competitors.

U.S. attorney Joseph Facciponti said in a statement "The bank has raised the possibility that there is a danger that somebody who knew how to use this program could manipulate markets in unfair ways."

Yet no one in the media has questioned Goldman Sachs about this sophisticated software trading program that the company admits could to be used "to manipulate markets".

Why? Do they think everyone who works at Goldman Sachs is a saint who would not even think about manipulating markets? That they are of a high moral standing? The company's bonus structure is evidence that this is not so.

Don't worry - Goldman Sachs will NEVER be investigated. The company has too many influential friends in too many high places.