---- How the Teamsters Beat Goldman Sachs ----
[You can stop Wall Street. The Squid is not invincible]
-SNIP-
With strategic input from Greenberger, the Teamsters were able to identify whom they were up against. “We picked up intelligence that Goldman (Sachs) was making markets (in CDS) and then we got some direct evidence,” Teamster spokesman Ian Gold tells me. But Goldman was not alone. “All of Wall Street” was trying to bring the company down.
In response, the union made it clear that they were prepared to name names. “We would make it our mission to hold people accountable,” says Gold. Following advice from Greenberger on strategy, Teamster President James Hoffa wrote to relevant Senators, Congressmen, State Attorneys General and regulators detailing how “Certain financial firms, have been or are marketing and/or underwriting a strategy where bonds in YRCW would be bought by investors with the intent of voting against the exchange, thereby triggering a bankruptcy that would pay the investors and possible other financial firms huge profits from the high CDS payments which would be triggered by a YRCW bankruptcy or liquidation. The profit from the YRCW CDSs would far outweigh losses from the failed YRCW bonds.”
Widely reviled as “the vampire squid” of the financial world, Goldman proved unwilling to be charged with throwing 30,000 truckers out of work. The bank not only caved, but offered its help. “As well it should have,” notes Greenberger. In a sudden turnabout, the company began cooperating in an effort to recruit bondholders who would do the right thing and vote for the restructuring. Even so, time was running out. YRCW was forced to postpone the crucial vote on the structuring no less than six times. By December 30, Brigade Capital, a $5 billion New York hedge fund, was the last major holdout. Only when the Teamsters prepared to picket Brigade’s Park Avenue offices did the fund fold.
counterpunch.org
Jim |
