It\’s not easy feeling sorry for Lloyd Blankfein but I do here:
Lloyd Blankfein has admitted that he believes Goldman Sachs has no moral obligation to tell clients it is betting against a product it is asking them to buy.
The very act of selling something to someone is a bet against that product.
If I were convinced that BP shares were worth more than £5 then I wouldn\’t sell them to you at £5 would I? That I am willing to sell them to you at £5 means that I think £5 is worth more than a BP share.
I am, by the very fact that I\’m undertaking a transaction with you, showing that I think you\’ve over valued the item. This is as true of apples, houses, bales of hay and stocks, bonds and collateralised debt obligations as it is of anything else.