The Great Depression

The Great Depression

The Great Depression was the first bubble that Goldman Sachs made explode and got away with next to no penalty. They were just beginning as an immigrant owned business with the idea to gain money by loaning it out to people at interest. They blew up around the depression for their practice in “investment trust”. They offered stock and made the average guys feel like they were investing a lot but they knew little of the process. Once they invested, the company bought their own stocks to make it look good. Then they get another investment in their “new, better” stock than before, and repeated the process. Eventually somewhere in the chain it broke and Goldman owned everything under fake practices. When the depression hit these people found out these investments were worthless and suffered while Sachs excelled. I agree with the author in the way that the practices were morally wrong and should have been illegal. Goldman knew what was happening and pushed back investment on people. I disagree that it’s all their fault though. Goldman at the time was only being ethically wrong, since none of the practices were outlawed. In the end it is the person’s responsibility to know what is actually going on with your money.

Tech Stocks

65 years later they picked up where they left off and began to scam again. This time Goldman attempted to pump up or down IPO on startups no matter how crap or great. With help from big players and the media Goldman would sell terrible and non-profitable stocks of companies to people claiming high rewards. The payoffs were good for a very short while and you could make money, but it was only a matter of time before the investment blew up. Sachs would know this part while everyone else was left to guess, usually failing. The rules were actually changed thanks to company banks, allowing crappy companies to be sold even if absolutely no profit would be seen in the future. Goldman also used laundering practices in which they told a companies’ good high value investors to buy now and at a later specified time, to give the false idea of fluctuation that benefitted investors. While Goldman denied this practice I agree with the author that they knew fully while these terrible companies were no good investments. I also agree that even though the law changed they didn’t tell investors and pushed even harder for a quick buck. I disagree that it was all them. These investors should have done research on the market and these businesses. They were blindly putting their money into personal responsibility comes in.

Housing Craze

In the third bubble Goldman Sachs caused and made explode the housing market was exploited. Because Goldman alum was everywhere they were constantly able to change rules to benefit themselves. In the beginning the housing market had respectable rules that