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Goldman Sachs & Company
Goldman Sachs CEO and Chairman Lloyd C. Blankfein, left, and JPMorgan CEO James Dimon testify before the House Financial Services Committee in February. (AP)

Goldman Sachs CEO and Chairman Lloyd C. Blankfein, left, and JPMorgan CEO James Dimon testify before the House Financial Services Committee in February. (AP)

The big banks of Wall Street almost took down the American economy. They came very, very close. Millions of Americans are still living every day with the consequences.

But last week, the banks — Goldman Sachs and JP Morgan Chase in the lead — announced record rebounds in profit. Giant pre-crash-scale bonuses are slated to follow.

For a public that just opened its treasury and took on many billions in debt to save the banks, this is hard to swallow.

This hour, On Point: Goldman Sachs critic Matt Taibbi of Rolling Stone, Goldman consultant Charles Ellis, and the battle over the banks.

You can join the conversation. Tell us what you think — here on this page, on Twitter, and on Facebook.


Matt Taibbi, contributing editor at Rolling Stone magazine. His article about Goldman Sachs, “The Great American Bubble Machine” (its subtitle: “From tech stocks to high gas prices, Goldman Sachs has engineered every major market manipulation since the Great Depression — and they’re about to do it again”), appeared in Rolling Stone’s July 9-23 issue.

Charles Ellis, founder and now senior adviser of Greenwich Associates, an international strategy consulting firm he founded in 1972. His book, “The Partnership: The Making of Goldman Sachs” came out last October. He has been a consultant to Goldman Sachs for more than 30 years.

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  • Putney Swope

    Thieves, nothing but a den of thieves. These people will bring this country down to it’s knees and then walk away as if it was not their fault.

    However they seem to have huge hold on our government as do most of the corporate interest. Look at the mess that is happening with health care. This is directly tied to wall street, the insurance corporations are all beholden to the market. They dump people to get there stocks to go up. Letting companies such as Sachs dictate our economy is going to end in a huge disaster.

    Just watch, the republicans are going to use the bailouts and anything else they can and will take back the congress in 2010, then the White House in 2012.

  • Ellen Dibble

    There is a comment at the tail end of a previous forum (by a Martin someone) to the effect that the markets (by which he means the moving around of capital, i.e., upper echelon banks, I suppose) — the market would function smoothly without crises if only there were zero tax on capital (gains, I think) so long as they took place within 7 days. The idea is if everyone would instruct their brokers to swap around their investments really often, then “capitalism” of the American sort would go along without glitches. I was horrified.
    Who invests just in order to enable constant profits? Per formula. Is that responsible?
    As the previous post noted, there is a lemming-like attitude in this: Ride our big computers right off the cliff.
    I can concur; the Republicans (or Democrats of a different stripe) could field the votes: herd enough people into desperate straits, where they have to depend on government supports, so they will vote desperate self-interest rather than national stability and growth. Looking at what the insurers/bankers seem to think they need, I’ll have to get myself declared disabled to land a share of Medicaid, unless we declare national insurance for all, in which case that strategem will not work for the Republicans.
    So I share the skepticism; yet my “socially responsible” investments skyrocketed in the last 3 months. Have the banks latched onto True Value? This may not be “on point,” but gee, I want to know.

  • Joe B.

    Jack Beatty pointed out last Friday that Goldman Sachs stood to make vast riches if Obama’s “Cap and Trade” (a gas and energy tax) becomes law as Goldman Sachs had secured the rights to sell carbon emission limits under “Cap and Trade”. That’s the real crime.

  • Gary C.

    Time we made the rich like they have made all of us: poor.

  • Mike

    even know we got screwed by the banks, the bright-side is there paying use the money back, i think we should lobby our officials to reinstall glass/Seg and create tougher anti-trust laws.(which i feel is all but gone). And not allow goldman to switch back to a investment bank.


    i disagree about your 2010 and 2012 comments, michael steele is a joke and i be shocked if he came up with any sceme to do this, also the racism shown against latino’s amd blacks, no ideas besides low taxes, no program and getting a wood when they say Reagen. they say look in the future but always go back to Reagan

    Anyone coming from the right currently will be from the far-right and will make things worst. i assume most people have watched there inaction i see a repub return maybe in 2014 after the economy is better.

    Sadly much cant be done about goldman cause obama is trying to appease both sides and republicans and some moderate dems will not vote of stricter laws against them and will cry out socialism if obama did.

  • PW

    It’s always about the same thing: corporatism and how we can’t free ourselves from it. Let’s go back to the F-22 for a moment, and the fact that Congress has refused to stop funding the production of a fighter jet which is no longer useful in contemporary warfare (or, euphemistically, “homeland security”). Why? Because the F-22′s manufacture has been planted (by design) in just about every state so every member of Congress has a stake in keeping an obsolete weapon in production.

    In much the same way we, as individuals, have allowed ourselves to become hosts of corporate parasites like credit cards, “life-saving” drugs, tech devices which “have to” be updated constantly, and a media which keeps us from thinking outside the narrow, airless box of our political options — not to mention the food that kills us! The intense need, greed and ambition that marks a company like Goldman echoes throughout every household in the US. We blame the politicians and the bankers and the WalMarts, but we’re no less greedy, ambitious, and dependent than any of them.

    That said, I think Goldman Sachs and its spawn (many of whom are administration and Congressional advisers) will go down in history as this era’s Teapot Dome, Enron. But remember, not a lot of punishment was handed out for the widespread damage done by Enron.

  • Lilya Lopheka

    Bonus = Tax Evasion

    Tax the hell out of Bonuses.

    If the public company is bigger than a certain amount, make Members of the Board and Compensation Committee be Reportable to SEC.

    You scracth my buttocks, and I will scratch yours:
    Management gives Money to the Compensation Committee Members and Comp people raise the Managements Bonus Package.

  • BHA

    The sense of entitlement continues. The people making half a million, a million, a few million will deserve the money when they work 10, 20, 50 times as hard and produce that many times as much in ‘goods’ as the people at the bottom of their companies. Of course the top folks at GS will expect they DESERVE these bonuses because they did such a GREAT job giving the government their money back by writing off the bad debt THEY created.

  • Todd

    Great point Joe B.! Here we go again! It’s business as usual with the Fed and Wall Street: one scam after another ad infinitum; and most importantly, always make sure there’s no time for the public to fully realize they’ve been swindled before they’re distracted by the next “crisis” (i.e., crime).

    As long as we allow our nations money to be manipulated by a private corporation (Federal Reserve Bank), the cycle will only continue–as it has since 1913.

  • Cheryl

    I have a very simple question: If the banks can afford to pay bonuses, why aren’t they required to pay off their bail out loans immediately?

  • Mark Mantho

    How about hump & dump?

    Two words:

    Wallstreet *parasites*.

    Mark Mantho

  • Putney Swope

    Mike I don’t want this to happen, but Americans are conservative by nature. I think the democrat’s will self destruct over the next 18 months giving the republicans an edge. I think it will be hard for them to win, but the might win back one or both houses in 2010 as it’s only a few seats for the Senate.

    I’m an independent and right now I will not vote for Obama. He’s a huge disappointment. I will vote Green or for any decent third party candidate. I’m done with the democrat’s and the republicans are just the party of scary nasty white men.

    He’s blown health care and the democrat’s have shown themselves to be very good at being clowns, but not for handling this huge problem. His handling of the economy has been pretty awful. He has carried on to many of the Bush’s policies in secrecy, and the war in Afghanistan is a mess to name a few things that can derail his presidency over the next few years.

  • Tom Derderian

    Will we hear from Bob Kuttner this hour?

  • DM

    These guys are terrorists in a suit that are silently taking this country down without any spectacular fireworks.

  • http://wbur.org Loren Watson

    It sounds pretty outrageous. And I don’t know that old “joke” about beating one’s wife, but it seems and unfortunate (and makes one think, “these people still don’t have a clue?”)reference. no more profits. GET A CLUE. GIVE IT ALL BACK. ALL OF IT.

  • Bob Keener

    Charlie Ellis is right: we are all responsible for letting Wall Street screw us. Logical answer is that we (the people) need to completely restructure banking and investment in the country so that it works for the majority of folks, not just wealthy investors.

  • Rick L

    Are these people really worth THAT much more than the average guy?

    With 1/3 of the wealth in the hands of 1% of the population isn’t this just an effort to push down others?

  • MargaretB

    The creative bankers may have lifted millions of people out of poverty over the last 30 years. BUT creative bankers returned that many to poverty in the last year. No?

  • Gayle Fedele

    This guest (Charles Ellis) does not even have the nerve to be an active participant?

    How we are as citizens of US suppose to act? Should we lay down and let them roll all over us?

  • Seth F.

    Whoa!! Wait a minute… did I just hear this guy right? He’s criticizing our public outrage as irrational emotionalism? The economic downfall of the USA to stubbing your toe in the middle of the night? Go live in a tent community, sir, or move your family into your mother’s basement if you want to be in touch with the current pulse of the American public. We’ve had enough. How you or any other Goldman Sachs employee can sleep at night is beyond me given your earthly track record. You have a lot of ‘splaining to do!!

  • Margaret

    Banks are kids?????? Not adults???? I’m with Matt 110%!

  • Paul LaChance

    Mr. Ellis has described Goldman Sachs and other financial institutions to children going to a parent to ask for a favor. Wow! But upon closer look, the parents in this situation appear to be the older sibblings. More than guardrails may be needed to get these children to behave and to grow up.

  • Todd

    Putney, sounds like you’ve figured it out. The Left-Right political paradigm is an illusion. In essence, it’s a ONE party system. Democrat, republican, it matters little which one you choose; they’re both merely different wings on the same ugly bird. The face in the Oval Office may change, but the agenda always remains the same. You’re right, the only real option is to vote 3rd party.

    This Matt Tiabbi guy has it right too. It’s refreshing to hear him call this banking deal what it is: an elaborate scam.

  • Don

    I think Charlie Ellis’s initial comment about how this economy is having a terrible effect on people all over the world and then gives as his first itemized example that “people are having trouble meeting their credit card obligations” eloguently exposes the mindset of the suits that have finalcialized the economy to the point where buying food and getting medical care is thought of an obligation that people have to a bank.

    Nothing will change until the of the “masters of the universe” remember that the function of an economy is to serve the needs of the people in it in a way that fairly distributes resources.

  • Felipe

    What would you expect, when Rahm Emanuel controls appointments and the gateway to Conflict of Interest?

    He is the Backroom Operator of Obama Administration with an Agenda that we cannot talk about here.

  • Marc

    While Matt’s critique of Goldman Sachs seems reasonable, his grave mistake is to not put these actions in proper industry context. For example, “pump and dump” tactics are, arguably, the role of private equity generally.

    So, fundamentally, Matt draws the lines too narrowly and doesn’t help people see that it’s a broader industry problem.

  • Doshi

    The reason people resisted bailing out struggling homeowners is the need to encourage people to take “personal responsibility” for their actions and to prevent moral hazard where people have no incentive to minimize excessive risk taking.

    Now, Charles Ellis is saying that it’s the government’s fault (not the fault of individual companies) when those companies reap profits without creating value to the detriment of everyone. It’s the government’s fault that these companies have taken on excessive leverage and packaged and sold junk.

    If, legally, these companies are “persons,” why don’t they have to take any responsibility? Charles arguments don’t hold water. Thank goodness journalists like Matt are continuing in the Cronkite tradition and speaking the truth on this.

  • Bob Keener

    Charlie Ellis says that Goldman will do what’s right for “The Economy.” Who’s economy? If we let it continue to be healthy only for the top 1%, we can only blame ourselves. You go, Matt!

  • Amy

    This Charlie man…he believes that the common american is just as responsible at Goldman Sachs??? What an egotisitical idiot! He believes that the middle class got what they deserved because middle class america is too stupid to know what really goes on. How has he made his riches??? He has benefitted greatly from the underhanded business of big banks.

  • Dana

    Charlie Ellis’s condescension is maddening, and a symptom of the same smug attitude that has brought us to this point. From toe-stubbing in the dark to analogies of children’s behavior, he tries to undermine Matt Taibbi’s well-reasoned, well-researched, and justifiably indignant Rolling Stone Piece by rolling out the notion that this system is too complex for we mere mortals to understand. Truly disgusting. Right up there with the “too big to fail” fiction. I’m surprised that ON POINT couldn’t have found a more qualified proponent to debate Taibbi’s assertions on its merits — and not with the old authoritarian shtick of the Bush years: “It’s complicated, it’s scary, but don’t worry: we’ll take care of you. Now bend over.”

  • Kevin Rich

    Washington answers to money.
    Washington gave all our money to a small number of big banks.
    Now banks run washington.

    Anything more that we hear from apologists for Goldman Sachs is just further obfuscation of the simple facts.

  • Kathleen Schaefer

    Mr. Ellis’s analogy of when children ask parents for something “bad” it’s the parents responsibility to say “No” shot chills through me. The idea that banks, corporations, who are also citizens relate to their government as child to parent is the essence of authoritarianism. This is how things stand in Communist China.

    In America the people, the banks, the corporations are effectively equal to the government. They HAVE RESPONSIBILITIES to the country as well as having rights and privileges.

    Perhaps this mindset is at the heart of the disconnect between financial bigwigs and the rest of u.

    Thank you for allowing me to vent.

  • Dan

    As a finance student I was predisposed to support the bank bailouts to stabilize the markets despite particular reservations. Mr. Ellis is doing more to persuade me to throw Goldman under the bus than any populist I have heard. Mr. Ellis implicitly suggests that business ethics has no place in business. If you don’t get caught or stopped, its not your fault. If Mr. Ellis is right, than we have no cause to prosecute Bernie Madoff. This radical laissez faire economics suggests that America’s strength should come second to Mr. Ellis’ ideology, and the profits of a select elite. He makes Gordan Geko sound like a great patriot and lover of mankind.

  • http://wbur.org Heather

    Regarding executive bonuses: Let’s not forget that most of the people who receive bonuses are not the people who set the financial goals for the banks, nor the ones who make the “big” decisions. Why penalize the same people who have the knowledge and the intellect to make change and make healthy profits – to turn around these banks? Why take away their incentive and encourage them to leave these banks and go elsewhere, when we can leverage them and provide them with appropriate goals and objectives? We’re going after the wrong people for the wrong reasons.

  • Bernard Biales

    So far, this discussion is going after some of the easy, though important, stuff and avoiding a key approach to the issue.
    It is correct to blame everyone — the educational system, the executive, regulators, and Congress, the unregulated and regulated institutions, and greedy ignorant individuals. Goldman Sach was the in some ways the smartest — they headed for the exit door first, but were caught a bit when we unexpectedly had a virtual crown forest fire.
    The missing point is the underlying validity of a non traditional derivatives based financial system (Buffett calls them weapons of financial mass destruction.)The amount of derivatives out there exploded in a short time. And their nature change — they expanded greatly as instruments of pure speculation. Unfortunately Obama’s advisors — and I think they are smart and generally well meaning — come out of a system built on this stuff and would have a great deal of trouble seeing the full range of their destructiveness and uselessness. The regulations proposed are pretty weak.
    If you look at the growth of these things and the parallel evolution of the economy,it is clear that the great majority of these things are useless are destructive. It is reasonable to suggest that 75-90 percent of derivatives could be phased out and the economy would tootle along more transparently and more likely freed than hobbled. Remember, the world did well without this massive level of derivatives of the last decade or so for the previous hundreds of years of capitalism. (Oil seems to be an area where, dispite denials, instability rather than stability has been a result of derivatives speculation.)
    Furthermore, if this system no longer supported jobs for a lot of very bright people, they might use there talents more usefully. The problem of the excessive income of these people comes into the mix at this point.
    Charlie Ellis is actually a moderately famous and highly respected guy. I don’t hear him saying much useful, though.

  • Putney Swope

    Charles Ellis wont answer the question. He’s spinning like a top. He keeps using euphemisms like the one about stubbing my toe. WHAT DOES THAT HAVE TO DO WITH ANYTHING!

    OK he’s claiming that poor old investment banks are victims.

    He’s telling porky pies. Lies. I happen to know someone how is in the middle of this who works for one of the huge investment banks for the legal department. They all knew years ago that the sub prime market was a bad deal. They all knew. They were told to keep quiet. All of this was known, this man is a BSer he has the nerve to come on the air and to blame me? I did not borrow anything. Yet my 401K is now almost worthless. My house has lost a huge amount of equity. This is on these people, wall street controls the game. Bottom line, my fellow citizens and I are not getting one to one access with the congress and the president.

  • http://tombstone001.blogspot.com MIOHAMMED N. RAZAVI, DALEVILLE, AL

    Call me cynical, but when we talk about taking two billion people out of poverty, (which they will be going back to as the imaginary money disappears), can we also talk about the effects of this money creation on the earth, on populations and cultures, on the environment. What will happen as more and more people who were once middle class, roll back into poverty , homelessness, broken homes, and broken families. Right now the US is working on deficit spending and bailout monies, that are also being created out of thin air, that well will also dry one day. Have been talking about it since at least 2003,

  • Todd

    Charlie says it’s Main Street that got bailed out!?? No man, Main Street is the TAXPAYER; it’s Main Street that’s provided the bailout of the swindler’s on Wall Street!

  • Bruce

    Did I hear Mr. Ellis say that Goldman “got it really, really right”? That sounds far-fetched to me!

  • Mary Horowitz

    As a retired teacher, I am enraged at the bonuses. My salary was paid by tax money and the word “bonus” never entered the picture. One obscene half a million dollar bonus would be equal to ten years’ salary for me at the time of my retirement. They have just slurped at the pig trough for years and feel it’s their due.

    I am completely cynical about anything to do with Wall Street. If Goldman Sachs or any of the other greed-mongers said the earth was round, I’d believe it’s flat. They have zero credibility and we ordinary slobs have just been sold down the river as dumb hick saps.

  • Dana

    Good. Lord.

    Now Ellis is bemoaning the personal sacrifices these poor Goldman Sachs bonus-earners are making. It’s a tough, tough job… and when they get it right, they deserve recognition for the blood they’ve spilled? Please.

    And then follows: “It’s very complicated. I’d be happy to try to explain it to you.”

    It makes this old agnostic hope there’s a Hell.

  • Manuel

    ….so let me get it straight:
    its a tough business
    the guys who get to the top are the “best and brightest”
    they met with regulators
    promoted and got approval on bad ideas
    and its the regulators fault for approving.

    lets say thats true…..
    then clearly these best and brightest were not so bright.

  • Bob from New Haven

    The attempts to diffuse blame is amusing as if there is no distinction between those that were responsible for taking a mortgage they couldn’t afford and lost their house, and those that made billions selling complicated derivatives, and got a government bailout. As with most issues relating to the haves and have-nots, it comes down to blaming the victim. As issues relating to welfare, healthcare, education, and affordable housing; the line is “it is those poor people that are going to ruin it for the rest of us”. Poor has long translated to mean minority, and yet few will admit that this is economic racism in its highest form.

  • Bernard Biales

    To put part of the argument more simply — this system, with it’s size and complexity, creates power that shouldn’t exist and puts power in the wrong place

  • Erich Riesenberg

    This is a typically disappointing show on NPR. Charles Ellis is a consultant to the financial industry, and the fact that he ignores the non TARP bailout given to Goldman is a clear sign of his intellectual dishonesty.

    This caller is now talking about the salaries. Stop focusing only on the salaries, it goes well beyond that. All this money should have been used for housing vouchers and food stamps. The economy could have fallen, and the good banks would have taken over from the failed banks. Instead the same losers remain in control and this drama is extended.

  • Rahuldeep

    HOW are you going to let go the comment that “Main Street got bailed out?” If you let him fly on this, and don’t question it before the show is over, you have seriously undermined your integrity. HE SAID MAIN STREET GOT BAILED OUT for god’s sakes!

  • Joe B.

    To Putney Swope: Obama, the Democrats, and Acorn don’t need your vote to win elections. They plan to steal all future elections, the same way Senator Al Franken stole the election in Minnesota.

  • David Williams

    I agree with Kathleen: It is NOT like children asking for a change in rules from their parent: It’s more like a combination of the rich uncle and executor of the family trust responsible for supporting the family asking the “parents” to change the “rules” ‘just a little’ so that the family can continue to receive the support of the uncle and executor… It’s not the parent’s (the commission, the government) who has the power as in the parent/child relationship. It’s those who have the influence, the power, the actual purse strings who have that power..


  • Ed Culver

    Leaving aside the issues of bonuses — most employers would fire an engineer (highly trained; I’ve yet to hear of anybody who switched majors from finance to engineering because finance was too hard), computer scientist, or just about any other non-executive employee for the forcing a company to beg get on its knees and beg for money from the federal government.

    The real problem is not only lack of regulation but close to two decades of political appointees in charge of regulatory agencies who have been appointed by ideologues with a basic belief that regulation was not only unnecessary but antithetical to progress. This shows all the sense of appointing Timothy Leary to head the DEA.

    The method of regulation advocated by some of the ideologues, which is “let the markets decide,” only works if the firms are made quite sure that they will fail. In other words, if you’re regulatory method involves giving corporations rope, you’ve got to be willing to let them hang themselves.

  • http://ravenatyournextevent.com Greg

    Watch Max Keiser rail against Goldman Sachs on French financial news. (You won’t see this in this country.)


  • Nate

    The more I listen to Charles Ellis the more I believe he is speaking out of a bodily orifice that is NOT his mouth.

  • Fran Johnson



    WALL STREET has no values. It has only very new rich thinking, the more money and the more conspicuous consumption, the better seems their only motive.

  • JR

    The first step in rectifying these problems is to stop allowing entities like Goldman Sachs to refer to themselves as “banks”. They do not engage in what most people understand as banking, which is pooling deposits then allocating risk, with their own stake in the game represented by their obligation to repay their depositors. Rather they market “innovative financial products” and facilitate “deals”, often times involving unsophisticated consumers who rely on the cachet inherent in being a “bank”, along with the assistance of ratings agencies that support the sales claims, many of which can only be termed as outright lies. And they are then allowed to bet against the very position they have taken in order to make the sale. In any other profession that handles other people’s money, this would be illegal fraud.

  • Moger

    Charlie Ellis has to be the worst guest I’ve ever heard on On Point. He did not answer one question.

    The most enraging thing about the whole bailout process was that Paulson and Kashkari (another Goldman guy) used the AIG bailout to funnel $12 billion to Goldman, which they don’t have to pay back!

    Goldman made a $3b profit; if they had to pay the $12b back, that would be a $9b loss. Would they have paid out bonuses then?

    Of course we are funding the Goldman bonuses. Anyone who doesn’t think so is nuts.

  • Erich Riesenberg

    JR is right about Goldman being BINO (bank in name only) was it the CFO on a conference call telling analysts they are not really a bank and to not expect lending? Just another part of the bailout hacks like Ellis choose to pretend they do not understand.

  • Erich Riesenberg

    One issue Taibbi ignores in everything he writes is Goldman’s claim they had bought insurance against AIG bankruptcy, so the money received from AIG was not all that important.

    I don’t know how true that is, and I am not a fan of Goldman and think the bailouts mark the failure of Obama’s presidency, though still glad he beat McCain, but it is an important issue that is ignored.

  • Don Bosshardt

    I think the `experts’ should reflect on the fact that that the organized derivative exchanges (Futures and Options) have functioned well even though they are essentially self regulated. Margin (good faith) escrows have workrd well to protect customers, and the times when they fail the clearinghouse/members have stepped in to protect the integrity of the marketplace. It is the over-the-counter markets which were the the problem. The players in that market (big and)are certainly taught to recognize counter-party risk -there is no way we should be insuring them.
    As a minor point, the Commodity Moderization Act (2000?) was intended to give goverment agencies (the SEC and CFTC) more oversight in the over-the-counter market (in response to Enron and other cases).

  • june hamilton

    The fox IS guarding the hen house. My husband has been in the financial advisor business for over 45 years (surviving 19 mergers in that time), and he is sick at heart about the state of our country`s cracked financial foundation. He forsaw the bursting of the bubble,around 4 years ago when deregulation was put into place.His newly-formed company has spent his pension. No bonus for him or his associates !!!

    Our combined worry is not for our personal survival, but our grandchildrens` and their chidren. The burden of payback will be on their shoulders.

  • Ellen Dibble

    The name David Stockman is surfacing in my mind as the beginning of this era, leading to the current money fiasco. I hope that name’s right. He was very young, the guy who reshaped taxes to better favor the well-to-do. The year was about 1983, and Reaganonmics dawned, asserting the theory of trickle-down economics, and that a rising tide lifts all boats.
    Uh-oh, we’re going to have to let this play out, it seemed. It seemed by what we were told that only the rich were the creators of jobs (the laws would make pretty sure that that was the case). And we were told that the makers of yachts would have no jobs if the rich were not securely rich. And we were told unless money was in the private sector, it was not lubricating the economy. I hear that still: that government jobs do not contribute to the economy (because profit is not allowed to be part of government undertakings).
    Oh, everything is up for re-thinking now. And that is a good thing.

  • Tom

    Although I can’t dispute the facts of Matt’s article (but I’m no expert) and tend to believe he is probably right about all this, I cannot take him seriously as a journalist. I’ve seen firsthand the distortions, exaggerations and errors in the accounts of events he has covered where I also was in attendance. It makes it harder for me to believe him now….even if he is right.
    Journalism, and not just banking, is in a sorry state.

  • Putney Swope

    Joe B. you and chicken little have a lot in common.

  • CR

    I’m curious where Mr. Ellis called from…. Please don’t tell me he was at “work”. I don’t believe he actually knows the meaning of the word.

    I have not been this offended by a single individual on the radio in quite some time. Mr. Ellis’ comments were at times contemptible to the people whose money make his world go around. He was transparent and hollow. Mr. Ellis began his interview with a posturing of defensive hostility and excuses…. his thin attempt at courtesy was pathetic. Shame on Mr. Ellis for telling me that the American public caused this problem.

  • Putney Swope

    Tom I agree. I read his article, I do think there is some truth behind all the distortions.

    The bottom line is we the tax payer have been taken to the cleaners. There is a long historical proof that the financial profiteers are to pillage and game the system.

    This has a long history. John Law comes to mind.


  • Scott Robinson

    Regarding the child analogy for the meeting between then Goldman-Sachs head Henry Paulson and the SEC in 2004: please. When children ask to change the rules? Are you serious? We then don’t allow the children to be in charge of the consequences of their actions as we did with Paulson as the Treasury Secretary in 2008.
    What happened to conflict of interest?
    That giant crackling sound is the cracking foundations of a rigid ideology represented by Charles Ellis et al.
    What was the per capita cost for the $23 trillion in “estimated” total bailout (http://www.bloomberg.com/apps/news?pid=20601087&sid=aY0tX8UysIaM)?
    About $77,000 for each of the 300 million US citizens.
    On top of this disaster US citizens have to face the reality that a “services” economy is not sustainable vis a vis globalization. Free markets have not gauranteed a sufficient condition for an emergence of integrated democracy… which, lest we forget is the more important ideology than free market principles. No, Neo-Liberalism economics is failing us and the hopes the US has stood for.

  • Jamey

    How can you fault a corporation whose entire objective is to make as much money as possible for its shareholders from doing whatever they can, within the law, to make as much money as possible and trying to change the rules to their benefit?

    From my perspective the federal government has a lot to answer for as our political leaders have been bought by the private sector. They have managed to deflect the media attention to these companies but the real blame lies with greedy politicians on both sides of the aisle (aren’t they supposed to be serving our interests) and incompetent regulatory organizations.

    And if our media had real journalists instead of attractive talking heads that regurgitate whatever the government says, these politicians would be called to answer for their crimes.

  • BHA

    Like Putney, *I* did not take out any sub-prime mortgages. *I* have ZERO money invested in any company that had ANYTHING to do with sub-primes (unless maybe I own shares in a mutual fund who’s investments I do not dictate?) yet my work 401K is cut in half, all my private investments are cut in half and it is *MY* fault because *I* didn’t ‘control’ the regulators or the boards and heads of companies that have no common sense nor morals?

    Mr. Ellis’ attitude is proof that we need a LOT of regulation in a LOT of areas of big business. And that regulation has to force transparency and traceability. When the ‘smart’ people get paid big bonuses for creating these untraceable high risk ‘instruments’ of big profit that took down the entire world financially then supposedly are the only ones ‘smart’ enough to ‘fix’ it (for MORE big bonuses), there is clearly something rotten in Denmark (only it is Wall Street). Every one of them should be forced to work for the next year at a minimum wage job that comes with no benefits. Maybe then they will figure out that they would have it darned good in their old offices at their old jobs for $50K – $80K a year with medical and retirement benefits and no bonuses.

    The ‘mom and pop’ small businesses that we are told are the backbone of our economy aren’t run like big business. Why? Because it is THEIR money at risk.
    We will continue to repeat this crisis in some form until business is run by honest people working toward low risk long term growth rather than ‘next quarter’ profits for the shareholders (and notice how much the big ‘boys’, including board members, get in stock options as ‘incentives’).

  • Marcy Luikart

    I have no problem with bonus’ in general if there is a high level of performance. But I do think that banks should not rely on the usual “insurance” channels but that a rainy day fun be created that is a percentage of the bonus’ or profits. This can be another safety net so that if things go wrong the public is not once again called in to “bail out”.

  • Rob

    I am absolutely dumbfounded by Charlie Ellis’ argument and position. If this is the attitude of those individuals who effectively run our nation (and by extension the world)… I’ll just say I am beyond concerned.

  • Erin Saunders

    Until Mr. Ellis learns to stop arguing by analogy (a logical fallacy; we covered this in high school debate!) and to stop using the passive voice to dodge responsibility, he won’t convince me of anything. Victim-blaming isn’t generally a sound philosophy, either.

    No wonder GS made such a mess with these devils whispering in its ear.

  • Jon

    Mr Ellis makes an excellent case. He and other speculators do not feel any remorse for their actions. They are doing us all a HUGE favor, by taking large risks with other peoples money and with the health of our economy. It is really the American people, and now apparently small businesses as well, that are really to blame.

    He makes the best case for a large increases in regulation I have heard so far. We have to regulate them, because they have absolutely no ability to regulate themselves.

  • Ellen Dibble

    Jamey asked back there: “How can you fault a corporation whose entire objective is to make as much money as possible for its shareholders from doing whatever they can, within the law, to make as much money as possible and trying to change the rules to their benefit?”
    I’m not sure what corporation this is, banks or in general, but I think the public should try to chip away at this idea of demanding maximum profit.
    George W. Bush tried hard to get as many people as possible invested in the stock market (remember his idea for Social Security? A stock portfolio for every American?). The idea, I think, was to get every American on the same side as the “corporations,” so that if they do not get everything they want from Uncle Sam, every little person with a retirement account would suffer and be on the side of the giants.
    Though Bush failed in that objective, enough of us have investments to be part of this puzzle, and I often hear that if investors like me did not demand maximum profits, all of this would not have happened. It begins to look like the babyboomers are on the line, and AARP along with us.
    Though I never look for maximum profits in my investments, and presume I am not alone, most likely the massive numbers of investors can have an effect. Waste the time of your investment advisors. Tell ‘em.
    I heard Mr. Ellis speak about the 2 billion now out of poverty thanks to international banking, something like that, and also thought, yes, and here we Americans have no viable future (see the post above; I agree); “integrated democracy” is getting steamrolled by monied interests.
    And as someone was saying, is it democracy or capitalism that we would save if we had a choice? Democracy, a voice for each, is becoming a sham, and socialism, with guarantees enough for each citizen to keep them off the streets, fascism under another name, rule of the powerful, is staring at us, even with Obama at the top.
    Am I disenchanted? Or do I simply think that the forces that congealed to get him into office have to keep at it till his objectives line up with his electorate again….

  • Maureen Ballard

    Maintaining calm in the storm of anger is certainly something for which we all ought to strive. But at this point, we want intelligent DISCUSSION and critical REFLECTION, rather than the weak anger management analogies that Mr. Ellis drones on about.

    Give us concrete EXAMPLES for the need of innovation and creativity in the financial market. As far as I can tell, banks ought to remain in their traditional, if boring, role as providers of deposits and loans.

    A ‘healthy financial system’ means removing the profit motive on what ought be a public service. The obsession with short-term profiteering rather than long-term development is a systemic and viral problem. To begin with, nationalization of bankrupt banks would be a natural consequence of bad management, bypassing questions of moral hazards. The financial ‘geniuses’ may or may not be fired in the process, but at least the profligate shareholders cannot get away with pushing debt and poverty onto the rest of us.

    Right on, Matt. Speak your mind, maintain your calm.

  • hkaplan4

    Taibbi was superb! What’s good for Goldman Sachs is not good for the country.

  • http://www.wfpl.org Byron Songer

    I agree. Keep it up Matt and Tom. I think we’re hearing weak excuses and arguments from Ellis because he knows where he gets his bread buttered. Unfortunately, he’s getting it done in a place that is unethical.

    I agree, Goldman Sachs and their ilk need to be held to a better standard that benefits us all — especially the average citizen in this country, not the ones that make in excess of $250,000 per year.

    We, the tax payers, should have a better return on our investment. We bailed out the crooks and not those that needed it.

  • Linda

    My gosh, Charles Ellis was the weakest spokesperson I have ever heard! Talk about deflection. This financial mess is like “stubbing my toe” and “I” need to take responsibility for my part in it???? I’m angry and I know who I’m angry at — those whose greed far outpaced their ability to sustain it! I’d like to stub my toes – really, really hard – on their backsides.

  • Mark S.

    Ban derivatives trading, ban short-selling and rein in the financial services industry, which has demonstrated its destructive drag on the real economy that produces goods, employs people and creates tangible value. The financial services sector should once again be relegated to the status of servant of the real economy, not master and executioner.

    The only difference between the derivatives of today and the “bucket shops” that were banned after the Panic of 1908 are … well, there really aren’t any differences, so ban them again. Oops! Forgot. Regulation went out the window with Gramm-Leach-Blyly in 1999.

  • david

    Once again I find myself forced onto the good ship USA Titanic. I was fairly safe in a lifeboat, but now I am forced back on this unsinkable economic ship. As I look around this ship I see mostly middle-class suckers like me, who believe the government is the answer to our problem. To my shock, I now see even rich people on board this unsinkable USA Titanic. We have been given assurance by the top nobs that everything is OK. Yet! I look around and none of them are on board. I see off in the distance sea of economic confusion, lifeboats filled with the top nobs. I see captain Obama and his trusted crew of Pelosi and the top Dems. safe in these boats. I search for a name on the boats and low and behold, they are named Goldman Sachs, AIG and Wall Street. They seem to be having a good time on these boats. I cry for help to those on the boats. They turned my way with a puzzled look on their faces and all cried out something towards the unsinkable USA Titanic. I strained to hear what was being said and I finally heard their reply. “How long can you tread water?” Wake up America!

  • EM

    thanks to Bernard Biales for his comment. i think its one of the very few worth reading here.

  • Rachael

    I have a question: If the profit Goldman et al has made recently didn’t go to its employees in bonuses, where would it go? They’ve paid back TARP money, so . . . then who gets the money if they hold onto it? People object to it getting paid in bonuses, but I’m not clear what the alternative is.

  • http://www.synapse9.com Phil Henshaw

    The sad fact is that everyone is looking right at the problem an not seeing it. The direct cause they’re missing is that it’s attempting to guarantee the endless boom is the direct cause of the bust, and almost no one is blaming that.

    Trying to stabilize endless boom pushes any system beyond it’s limits of control. The direct fault everyone’s central purpose, trying to assure returns on investment that people can use to add to their investments.

    It’s not the bit players or the best players, it’s that particular system. Because it is describable it is solvable, but you’d need to be prepared to ask people with investment earnings to spend them, not reinvest them in multiplying more. That’s the common thread to every panic in history that no one learned from. That’s it.

  • Mark

    Thank you to Mr. Ellis for telling me that I, the average citizen, was responsible for the financial mess we are in! (no credit card debt, fixed-rate mortgage, etc.)

    Maybe I am to blame but this is just “too complicated” for me to understand.

    I don’t normally yell at my computer but kudos to Mr. Ellis for getting me to do just that.

    Although maybe my computer needs to share some of the blame as well….Seems like Mr. Ellis wants to spread the blame as far (away) as possible.

  • Olin McKenzie

    The inextricable link between business leadership and ethics is lost in Mr. Ellis’ version of “caveat emptor”. The apparent denial of any responsibility for the havoc wreaked on so many lives demands that regulation by stiffly starched. Personal or corporate gain have come to dominate this culture, and imbued it with a self assessed belief in divine right. They know not how to behave.

  • raul

    Matt Taibbi,Matt Taibbi,Matt Taibbi,Matt Taibbi,Matt Taibbi, yeah……

  • Ellen Dibble

    I likek Bernard Biales’s comment too. The problem back would be, if that terse remark were to the exclusion of the other comments, it offers nothing by way of facts, solutions, or answers. Only points to the issue of power, misplaced power. It’s a fairly safe point to make, since getting specific is very difficult without wallowing in deep northern Atlantic waters, to borrow a simile. Or to borrow from Milton,
    “Knowledge is a dangerous thing; Drink deep, or touch not the Pyrrhean (sp?) spring.” I think Americans have tried that, leaving evaluation of economic potential to the experts, the “advisors.”
    So Rachel asks about the alternative to bonuses. Item one, if “they” don’t get the bonuses, the states they reside in don’t get to collect taxes on them. Item two, if “they don’t get the bonuses, which I guess would likely go right back into investment instruments of their highly educated choice, it might steer the economy in ways the banks who bestow the bonuses do not favor. The guest Matt might know why, but the obvious answer is bonuses would either go to GS’s reserves or go back into the economy via other payouts or loans/investments of some sort. (The issue of the effect on inflation if new funds enter the economy was addressed today by Chairman Bernanke; no inflation so long as the banks are sitting on what $$ have been sent to the banks. The problem comes when they start loaning it. So maybe the bonuses are a bank maneuver to hold down inflation. Dope-hit me, someone. How the heck do I know.)
    What we have in this forum seems partly exquisite venting to the effect that this nation may be incomprehensible to the financiers who are sort of managing it, incomprehensible since bankers are insulated from “our” reality exactly because of their incomes. This is surely not altogether true, but that view is certainly getting an airing.
    So we rage at the mutual lack of transparency, the banks to the people and the people to the banks. That is my view. In some new and basic way this “one nation, under God, indivisible” apparently needs to be more or less in the same ballpark. New metaphor.

  • Lon C Ponschock

    Word to the producers at On Point,

    I no longer have any patience whatsoever with being told by so-called informed individuals like Taibbi how “basically” and “essentially” everything is. This is dumbed own shorthand and I turn it off– in this case after 2 minutes.

    Please join my campaign to eliminate the tedious use of the word ‘basically.’

    Here is the reasoning:

    The word “basically” is an overused verbal tic which demeans and condescends to the listener. It is at the same time a way for the speaker to inflate his own self esteem by flogging and repeating words that appear to emphasize personal knowledge.

    It is a fault which has become, I fear, some sort of custom or accepted colloquialism– a trope of the pundits and the meritocracy.

    Proudly signed with my full name.

  • Brenda Sprengeler

    What about Goldman Sachs bundling bad loans and selling them off as Mortgage Backed Securities and then stepping over to AIG to make bets against those Mortgage Backed Securities by way of credit default swaps. Then put a CEO of Golman-Sachs in the Treasury Secretary position who bails out AIG so that Golman Sachs gets to recover their money from the Credit-Default swaps. They, in essence bet against their own loans and then got government bailouts thru AIG and thru direct-bailouts. Boy, is America stupid!!!! And it still is.

  • Linda Hoyt

    You ask, right off the bat, can we put up with IT anymore? NO NO NO NO!!!! I truly cannot.

    This is no longer a democracy but a Corporatocracy. I believe our president would like to reign it in but unless all Americans become aware of what has happened and continues to happen,and force a change (of atomic proportions),the corporate wall is WAY too thick with greed and selfishness (entitlement, coruption, lack of conscience), I see no way a few men of integrity can win our country back for us.

  • Art H.

    RE: Charlie Ellis:

    I hope someone slaughters C. Ellis and all the greedy bastards behind this giant scam. At least I was able to calm down express myself civilly.

  • Joe B.

    To Putney Swope: You and chicken#%*@ (expletive deleted) have a lot in common.

  • Cathy

    It is a bunch of nonsense that 2 billion people were bailed out of poverty by “creative financial practices.” How dare Mr. Ellis try to credit his religious worship of corporate control for this change. In many cases, it was the power of authoritarian governments as in China or of large state-owned or controlled enterprises that led to this change.

    The idea that 2 billion people have been lifted out of poverty is now being used to justify all sorts of outrageous practices such as supposedly “free trade” (actually repressive and restrictive, as opposed to fair trade).

    I agree with others that Mr. Ellis was one of the most offensive guests I have heard but he is also amusing in his arrogance, audaciousness, and alienation from reality.


  • Stephen Glinick

    “A man with a briefcase can steal more money than any man with a gun.” Don Henley

  • Tom

    Courage is the 1st virtue, and Matt Taibbi embodies it in his speech; it is astonishing that none in the colossal American media of the 21st century had his courage to question “the big and powerful brothers” as he did… it had to come from “Rolling Stone magazine!”… What a dishonor to all the schools and Universities with all their departments who seem to graduate silent graduates… Socrates said more than 2400 years ago “Courage … is to preserve the opinion produced by law through education… the law teaches that citizens must do what is best for the city and what is truly terrible is failure to do so…”

    Our crisis brings indignity to Harvard and Yale and all those Business Schools that have taught and researched Business with Ethics as an afterthought, the Business Schools are as much to blame as our lack of Courage… and now, let us teach our Doctors and Nurses to follow such business values and let us see what happens to our health and the reforms. Many of the people that Charles Ellis defends have preyed on the good-heartedness and lack of knowledge of the ordinary person, as well as the hard working professionals that trusted them… President Obama will lose much credibility with time if he continues to surround himself with such people, whom he placed in key economic and advisory positions… They insult every bit of our human values and intelligence…

    and this brings to mind a Quote from George Orwell in 1984 “… and they apply the process of continuous alteration not only to newspapers, but to books, periodicals, pamphlets, leaflets, films, sound tracks, cartoons, photographs-to every kind of literature or documentation which might conceivably hold any significance… day by day and almost minute by minute the past was brought up to date … in this way every prediction made by the Party could be shown to be documentary evidence to have been correct; nor was any item of news, or any expression of opinion, which conflicted with the needs of the moment , ever allowed to remain on record. All history was a palimpsest, scraped clean and re-inscribed exactly as often as was necessary. In no case would it have been possible, once the deed was done, to prove any falsification has taken place… Ignorance is Strength…”

  • Rick Hale

    Matt Taibbi was very helpful (read his article in Rolling Stone) BUT he missed a great opportunity yesterday. When Goldman Sachs reported it’s recent quarterly earnings report, one of the primary reasons management gave (about 3 primary reasons)for the 25% profit margin was the REDUCED COMPETITION – the bankruptcy of Lehman Brothers – big competitor in markets with GS and the weakness of others that were bought out. Which proved, in management’s own words, that they profited at the expense of us, the taxpayers, in the bailout. As former CEO of GS, can’t convince me that Paulson didn’t let his former rival fail – Lehman Brothers.

  • Erica Blair

    RE: “To Putney Swope: Obama, the Democrats, and Acorn don’t need your vote to win elections. They plan to steal all future elections, the same way Senator Al Franken stole the election in Minnesota.”

    To: Joe B. [the plumber's apprentice?]

    I was very anxious about the future of the country that I love after listening to Mr. Lucifer Ellis and then I read your “listener” comments. Thanks for the comic relief!

    It was people like you who created the Cheney administration with the subsequent bankster deregulation and fleecing of the flock. Now without any ability to think for yourself you believe that citizens attempting to take back their country was a coup by the “beast.” Ellis and his employers are counting on you to breed more little dittoheads…

    Erica [an independent conservative & US veteran]

  • Ellen Dibble

    Speaking of reduced competition, bankruptcy, and expense to us, Massachusetts bankruptcies are way up and expected to go higher, as people’s lost jobs begin to be reflected in defaulted obligations.
    Blame the victim. We know.
    The banks aren’t going to just lay down and take the losses from folks who lose their jobs and have to leave their credit and credit accounts in the dust. No, they will raise the loan rates wherever possible to 29.9999 percent.
    And the result? Get out your calculators. People with loans they could handle all of a sudden are out of their depth, and as good as gone. From the point of view of the banks who loaned to them, those customers might as well have lost their jobs. They are not as asset but a liability (– to whom now?).
    So the banks charge more, the banks loan less, businesses go out of business, families get squashed, and who is to blame? Families of course.
    It seems like a vicious cycle of failures. I hope to find that issue of Rolling Stone with Taibbi’s article before it disappears, but hope something “comes of it” first. Dream on.

  • Terrance B

    I lean toward free markets and conservative political ideas, but I have to say I was astonished at Mr. Ellis’comments re: the role of financial institutions compared to children asking parents to change the rules. Mr. Ellis literally made my skin crawl. I felt like I needed a bath after listening to this program. Matt Taibi may not get it 100% right, but at least he is willing to support his argument with facts. Although Mr. Ellis stated he was attempting to not sound patronizing – patronizing is exactly how he sounded. Mr. Ellis, I may not be nearly as sophisticated as you are, but I’m wise enough to know this: don’t take advice from children. Since the financial institutions (and by extension – you)are “children”, we as the American public should not believe anything they (or you) have to say. Personally, I wouldn’t believe you if you told me the sun was rising tomorrow.

  • Putney Swope

    Joe B, how old are you? 7 or 8.

    I hope Charles Ellis is reflecting on what he said on the show. Equating the financial crisis to stubbing ones toe on furniture while walking to the bathroom in the night was one of those moments when I found myself almost spitting out my coffee. From reading the comments it’s clear that this man is arrogant, self centered, and condescending. He was defensive when he should have been apologetic. They knew what they were doing. They knew a lot of what they had was junk, they all made bets and lost and now they want to blame us, the American people for this. Is he serious?

    Ellis spent the hour making a lot enemies and reinforcing the notion that these captains of capitalism are not to be trusted on any level. They need to be regulated like children who don’t know the difference between right and wrong.

    The other thing, lobbying needs to be made illegal and I’m sick of hearing that this is a form of free speech.
    It is clearly not, free speech is about speaking not donating money or paying congress off.

  • millard-fillmore

    So when will On Point and other mainstream media start inviting members of the Green Party, other third parties, and individuals who are not beholden to the corrupt two-party system? Or will they continue to play apologists for the corrupt and spineless Democrats?

    As Einstein said, (paraphrasing) we can’t solve problems by continuing to think at the same level that created those problems.

  • ulTRAX

    The US economy is based on smoke and mirrors and may already be in a self-consuming cancerous stage.

    Investment banks like Goldman Sachs produce little of value except giant profits by skimming the cream off the churn of other people’s money. They suck investments money away from productive activities into speculation. We’ve allowed speculators to pour borrowed money into fantasy economic instruments called derivatives… bets on bets. Speculation in the equities market also drains money away from productive activities. Speculation in the crude oil business that brought oil to $147 a barrel wasn’t just a vacuum cleaner into our wallets, it may have been the last straw in bringing the economy down. One of our political parties has 30 years ago decided to sabotage the finances of the federal government with irresponsible tax cuts so We The People have now consumed some nine TRILLION in services since 1981 that we have not paid for. We measure our economy’s health with defective economic indicators like the GDP which includes useless and even destructive economic activity… and the DJIA that represents a mere 30 companies… and when one is replaced they skew the numbers to make it continuous. Anyone wonder what the DJIA is of those ORIGINAL companies? We have hollowed out our industrial economy with trade deals like NAFTA and GATT and now the US has become the biggest debtor nation in the world. We have created the most inefficient and expensive way to create new drugs and provide health care yet our politicians are bought and paid for so meaningful reform is nearly impossible. With the exception of shows like On Point, the news media has failed miserably to educate the public about the clear and present danger all of the above poses to our economy.

    Against such momentum and odds, can Obama really do much to reform the US? Or will the US continue down the road into self-consuming destruction?

  • Ellen Dibble

    I suggest a March on Washington with the objective of getting the lobbyists out of Washington and out of elections. It seems to me that the most apt points are made not in private lobbies by paid advocates but by often underfunded and unorganized, unincorporated persons. When Obama asks in “his” e-mails for us to call our representatives, or e-mail them, I think, dream on. Such numbers are meaningless compared to the money and organization of The Establishment.
    Americans could muster in DC against the war in Vietnam; they could muster for civil rights for African Americans. Can we muster for representative democracy and a chance for financial common sense?

  • Mark S.

    Did I mention that Ellis is an arrogant, sanctimonious jerk? Couldn’t remember… There. I said it…

  • Tom

    Where are the “Institutions of Higher Learning” in this debate? Where are the “Higher Learning experts” hiding when we need them most? Where are the experts from University of Pennsylvania: Wharton, London Business School, Harvard, Columbia, Insead, Stanford: GSB, IE Business School, Ceibs, MIT Sloan School of Management, New York University: Stern, and University of Chicago: Booth, Dartmouth: Tuck, IMD, Duke: Fuqua, Indian Business School, Hong Kong UST Business School, Cambridge: Judge, Oxford: Said, Yale, Berkley: Hass, UCLA, Cornell: Johnson… etc…etc…
    Where are the Professors? …where are all those on the yearly “100 best schools” in FT and others? Where are all those Academicians and Nobel Laureates to enlighten us? … Where are all the “theoretical” papers and studies they publish? Are they in “Memory Holes”?
    … Where is their “courage” to speak up… while teaching “Hypothetical” and “infinitesimal” courses on Economic indicators, Finance and Business Administration while in our “Reality” the “Masters of the Universe” are ripping us off with “CDO’s”, “Credit Default Swaps” “the MAGIC of deregulation” and whatever new quirk comes up next… vacuuming our retirement savings and our children education savings to their coffers, in broad daylight… as we the hard working professionals and struggling workers in other fields lacked the knowledge and transparent information in the fields of Finance, Business and the Economy… and because we “trusted” the “outspoken Masters of the Universe” as graduates of these “same esteemed institutions of higher learning”!
    They insult every human value we have in us, and the “silence” emanating from the “institutions of higher learning” is “deafening”?

  • ulTRAX

    Ponschock wrote: “I no longer have any patience whatsoever with being told by so-called informed individuals like Taibbi how “basically” and “essentially” everything is. This is dumbed own shorthand and I turn it off– in this case after 2 minutes.

    Please join my campaign to eliminate the tedious use of the word ‘basically.’”

    Talk about misplaced priorities. Ponschock seems more concerned about some mild misuse of language… enough to even boycott listening to yesterday’s show… than the outright betrayal of the American Public by Wall Street crooks.

    It’s fascinating… in a pathological sort of way.

    Blog at: http://reinventing-america.blogspot.com/

  • Gargoyle

    Tom, I’m with you here. The explosion of the MBA seems rather to have become a license to piracy. The self-importance and singular perspective (money, the more the better, is a measure of MY value to the world, nay universe) of so many MBAs I have known and worked with ( I’ll leave some wiggle room that there are at least some more human and wise) is summed up in Mr. Ellis’s resume and revealing performance on On Point.

    So…. is the place to put our money the local credit union???

  • Ellen Dibble

    All this fulmination about the failings of academia. I am so unsurprised by their absence that I hadn’t noticed. I am unsurprised because the distinguished institutions (Harvard most extravagantly notably) have endowments that are composed of investments that are invested along the lines, I assume, that their graduates have been preaching. They rose and fell by their own petard. The last thing an institution with such an endowment needs is a delegation of professors preaching against his/her own choir, undermining the moneyed interests that undergird those institutions.
    That’s my instant take.
    As to “basically,” I have another word to offer: “appropriate.” I heard Hilary Clinton use it in regard to some foreign official’s maneuvers or representations. To me, “appropriate” is about as patronizing a word as you can get. It suggests that the person’s action deemed “not appropriate” has no judgment, no breeding. “Appropriate” (thus used) is far worse, I’d say, than “basically.”
    That said, Clinton would know everyone caught her meaning along with its aspersions. Woe be to any listener who didn’t acquiesce to her “take” on the matter. “We” have an understanding.
    Maybe in India, the word does not have the overtones, but I cringed. “Appropriate” is not as diplomatic as it seems, in my view.

  • Tom

    To Gargoyle and Ellen, the lesson is that a business degree and resume’ does not count as much as the behavior of the person carrying it… It is great to be talented and come from a great University (100 Best Business Schools or whatever…) and have a polished Resume to run Financial Institutions and Banks…
    However, Unethical Talent is a Curse…
    What good is it if Hitler was talented?
    If talented means destruction and misery to millions of people?
    As for “where to put our money”… that depends on our Values and Trust… there are no shortcuts, we need information and knowledge and have good systems in place and do not acquiesce to domination…
    I think, this all about Leadership and Trust and this is where President Obama or however leads, needs to show what lessons we have learned. I differ with Ellen that I have not given up yet on the good people in the Private Sector and the great Universities to help us learn some lessons and institute real remedies to the system, but it seems few have the courage to do so.
    The gangrene needs to be removed, otherwise, the wound festers and gangrene sets in deeper and the cure becomes Amputation and a more dire consequence and protracted illness and Death…
    I do not see how the same people that led us to this Disaster are the ones that will bring us the Cure…
    It is unreasonable to allow ourselves to be bitten by the same Snake twice! They depend on falsifying history and the People’s amnesia to the events as time passes… but, this is where Leadership matters… Tom

  • Ed Sweeney

    Wow – this Charles Ellis is a right tosser.

    His dripping condescention is unbearably off-putting. You know the B.S. meter is well past the red when you have someone saying “I’d like to answer that but I’m trying to understand your question…”

    In other words, “I can’t give an honest answer because it will make me look bad so I’ll feign misunderstanding and blame you for your poor question…”

    What a clown.

  • Brendan T. Redmond

    I echo the sentiments of many when I say that Charles Ellis was one of the most condescending, egotistical and pompous guests I’ve ever heard on On Point. (I almost turned off the radio when he went into the second minute of his toe-stubbing metaphor and gave us all permission to feel angry.) But shame on Tom for not taking him to task for his evasive, inane or non-existent answers, and shame on the producers(s) for not finding someone to at least advance a cogent defense of Goldman’s history and practices.

  • M.Carr

    First of all, great segment! While health care reform is of course of critical importance to this nation, I think it would do a great disservice to the country if the issue of TARP money and Wall Street’s outsize influence over economic/financial decision-making within the federal government were allowed to fall by the wayside. It’s far too important an issue not to be addressed.

    With all due respect to Charles Ellis, Matt Taibbi cleaned his clock. After starting off by suggesting that Taibbi’s reporting was both inaccurate and ignorant, Ellis seemed unwilling or unable to list any concrete examples of any such inaccuracies. I for one would be more convinced of Ellis’s criticism of Taibbi if he had bothered to come up with at least one example of error in Taibbi’s reporting.

    Thoughout the segment, it was the outsider Taibbi who seemed to have a better grasp of facts than the experienced Ellis. I also noticed that Ellis had no response when Taibbi cataloged the numerous examples of former Goldman Sachs obtaining positions of power within the federal government, positions in which they were key players in decisions that directly affect the fortunes of their former employer Goldman Sachs.

    This infiltration into federal government by Wall Street power players is something that disturbs me greatly, and Ellis seemed to have no comment on it whatsoever.

  • Robin

    Hmmm. Well, first of all I think Tom did a really good job with this. He pressed Charles Ellis without ever sounding aggressive or angry and he was very careful about asking Ellis clear questions and giving him time to answer. That was great, because it didn’t leave Ellis any room to change the subject of the debate into “irrational hatred of the uninformed”, which he was clearly trying to do with that *sad* and labored stubbed toe analogy.

    Secondly, Matt Taibi definitely did clean Ellis’s clock. That was fun. And prevented me from throwing my computer around the room.

    Thirdly, I initially assumed that Charles Ellis was in the pocket of GS, being their consultant for the last 30 years and all. However, upon reflection, I have another theory. With the guillotine industry having ceded so much industry share to the gun and rifle manufacturers AND knitting falling out of fashion, these two industries have clearly joined forces to increase sales. If Charles Ellis makes many more appearances I am going to convert what is left of my pension plan into knitting needles, wool and guillotines. He will make sales boom! Really, he couldn’t be that tone deaf and out of touch with regular people…could he?

  • Joe B.

    erica blair, after reading your drooling rant, it’s obvious you are no consevative. F.Y.I., being in re-hab does not qualify as being a veteran.

  • Ellen Dibble

    I don’t want to monopolize this thread but I’m wondering if I managed to confuse Robin with my statement up top that my “socially responsible” retirement fund had skyrocketed in the last 3 months. That is not a Goldman Sachs account or fund, nothing Charles Ellis sponsors, as far as I know, except that I believe banks invest in each other, or retirement funds invest in banks and financing instruments. Something like that. So one firm’s fortunes impact all the others. (Prime case in point, the banking fiasco of 2008/2009.)
    My life insurance company offered retirement funds that I grabbed long ago, and it took under their wing a Neuberger fund as an option for clients in July 2007, actually the day before I happened to call to inquire about the same. Serendipity. Dumb luck; but the fund went drowning while balanced stocks soared. And I was mad that “responsible” did not mean “forward-looking” but alcohol-free/gun-free (or so I was told). Then balanced stocks that had soared, soured. I quit reading statements. Why did I even read the new spiked one? I’m in a state of denial. Someone’s playing tricks. It’s not smoke and mirrors, not guillotines and knitting needles. What is it? Bad eyesight? A fluke? Another shrunken fund I had I called and placed with a “socially responsible” fund in another company, one that hadn’t spiked (yet).

  • Julia

    Thank you, Matt Taibbi!

    Thank you Tom!

    And thank you, Mr. Ellis, for showing the true face of Goldman Sachs and their “consultants.” – This is who they are. This is how they think. This is what they think of us.

  • Robin

    “I don’t want to monopolize this thread but I’m wondering if I managed to confuse Robin with my statement up top that my “socially responsible” retirement fund had skyrocketed in the last 3 months.”


    You have successfully confused me now :)

    (I wasn’t making reference to your comment with mine.)

  • Ellen Dibble

    Well, I’m glad you’re smiling. I guess you had successfully confused me, sorry to say. I mean, not sorry, but amused and engaged, I guess. Were you being poetic?

  • Robin

    “Well, I’m glad you’re smiling. I guess you had successfully confused me, sorry to say. I mean, not sorry, but amused and engaged, I guess. Were you being poetic?”

    Poetic? No, I just have no idea what you are talking about. My comment had nothing to do with you, or your investments or your comments. Therefore, I don’t know why you were concerned about confusing me. I was responding directly to the show and not to you. Best wishes to you, though.

  • Ken

    Mr. Ellis was perhaps the most patronizing and enraging man I have ever heard on radio. I was sorely disappointed with Mr. Ashbrook’s failure to direct any of the callers’ hard questions toward him. For example, a lobbyist called in to make the point that Mr. Ellis’ stance that Goldman’s meeting with Hank Paulson was part of the democratic process overlooked the reality that only major campaign contributors have that type of access to regulators. The millions of Americans who have had their homes taken away were unable to chat with the Sec. of Treasury about new loan terms. Ashbrook did not ask Mr. Ellis to clarify. Mr. Ellis launched ad hominem attacks on Matt Taibbi on every occasion. Mr. Taibbi was presented as some sort of firebrand and his journalism was called “hyperbole” perhaps 10 times.

    Really, really poor stuff here.

  • mr. independent

    What do expect, Tom does not do his homework. As the recent program on health care made painfully obvious.

  • Rachel

    Charles Ellis, sounded like a shrewd salesman, twist and turn the simple fact, trying to make a simple moral issue into a “complicated” excuses why Goldman shamelessly robbed American and the people in the world. He even has the nerve to treat the listeners (yeah, ordinary Americans) like idiots, he feels he has to bother to make metaphors so the us ordinary Americans would understand the “complicated” crime that they committed in broad day light.

    If On Point would let me curse, #@*!*&@!!!

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