Senators Slam Goldman, Schiff Slams Senators: "They Have Some Nerve"
Posted Apr 28, 2010 07:15am EDT by Aaron Task in Newsmakers, Banking
Related: XLF, GS, JPM, MS, BAC, C, FAZ
Goldman Bruised, Defiant in Senate - WSJ
Not us: Goldman execs deny wrongdoing in crisis - AP
Panel's Blunt Questions Put Goldman on Defensive - NY Times
Goldman executives face grilling - Washington Post
Goldman Sachs CEO defends firm at hearing -USA Today
Goldman execs stand their ground at Senate hearings - LA Times
Predictably, most of the coverage of yesterday's Senate hearings on Goldman Sachs focused on what the firm's executives, including CEO Lloyd Blankfein, said or didn't say.
Just as predictably, Euro Pacific Capital's Peter Schiff looked at things from a different perspective.
"The most frustrating part is hearing these Congressmen question Goldman Sachs...and point the finger at them," Schiff says. "What about Congress' action? I'm not saying Wall Street was blameless, but the greater blame lies with government, with the Federal Reserve, with Congress, with these Congressmen."
I get the sense Schiff is unlikely to be greeted warmly by many sitting members of that august body should he win his long-shot candidacy for U.S. Senate. Then again, I'm pretty sure he doesn't care about making friends.
"They have some nerve," he says of the members of the Senate Permanent Subcommittee on Investigations. "I wish someone had the guts to turn it back on them [and say]: ‘Of course we're making all these crazy loans - you guys promoted them. You wanted loans to be made to people who couldn't pay them back.'"
As you might expect, the fiscally conservative author doesn't have much faith in Congress to pass meaningful financial regulatory reform.
"It's just going to be like Sarbanes-Oxley," he says. "Very onerous [and]
does nothing to address the root cause of the financial crisis," which were:
-- The Fed keeping rates too low, too long after the dot.com bubble burst.
-- Fannie Mae and Freddie Mac guaranteeing mortgages of all shapes, sizes and dubious quality.
-- Government subsidies and insurance programs like FDIC deposit insurance that created a moral hazard.
"It isn't a free market problem - it's not a capitalistic problem," he says. "It's a government problem -- government intruding into capitalism and creating the problem."
If you like what you see and hear in the accompanying clip, click here to learn more about Schiff's Senate campaign.
finance.yahoo.com |
