RUSH: I don’t understand this, folks. I literally don’t understand this. I thought we were in the middle of a robust recovery. I thought we’re going to nail these evil Goldman Sachs guys to the cross today. I thought we were going to have health care for everybody. And look at this, the Dow Jones Industrial Average is tanking, down 143 points, 140 — well, 136 now. ‘Stocks fell late Tuesday morning after growing consumer confidence and the latest round of upbeat earnings reports mostly offset fresh concerns about Greece’s debt problems.’ So we’re back to Greece.
Rush Limbaugh, the EIB Network, the Limbaugh Institute for Advanced Conservative Studies, 800-282-2882 if you want to be on the program. E-mail address, ElRushbo@eibnet.com.
Not just Greece, Spain and Portugal, folks, the whole European Union, it’s a mess over there. And our unfunded pension problems in California are just the tip of the iceberg here. But, at any rate, there are other things going on out there today. We’ll get to that as much as we can today in our three-hour period.
Numerous attacks on Goldman Sachs taking place even as we speak. The hearings are going on. Something very curious, though, Snerdley, are you watching these hearings on C-SPAN? You’re watching them on Bloomberg? Here’s the interesting thing, ladies and gentlemen. Here we have the regime, which is trying to make Goldman, and therefore Wall Street, the absolute worst enemy of the people ever, and yet the regime’s network, MSNBC, is not televising it, CNN is not televising it, and Fox is only intermittently joining it. I would think that the entire regime media network would be in on this because this is the day to nail Goldman to the cross, to nail Wall Street to the cross, to have the regime appear to be the best friends of the little guys, and what it tells me is this whole thing may be an act. This whole thing may be a show, that Goldman’s in on this, this is the price they gotta pay for making billions and billions and billions of dollars later on in a partnership with the regime. Now, I’m just speculating here because this is very odd, it is extremely odd out there that the crucifixion of Goldman Sachs is not being televised. I find this fascinating, and the networks, you might say that they’re a little bit shy about live show trials. They got burned by the Oliver North hearings way back when with the Iran-Contra stuff. So anyway, that’s that.
RUSH: Carl Levin, mock or real… I don’t know if the outrage is fake or real, but he dropped the S-bomb four times talking to Lloyd Blankfein. Where is the decorum here, where is the civility? Carl Levin, Senator from Michigan dropped the S-bomb four different times, and Cookie said, ‘Do you want me to bleep that?’ (interruption) It was to Stark? It was to Fortney ‘Pete’ Stark? (interruption) Oh, it was not to Blankfein? It was a different Goldman guy. Well, anyway he dropped the S-bomb.
Cookie said, ‘Do you want me to bleep it?’
I said, ‘No, no. Let it run.’
She said, ‘You know, I’m going to bleep it just to protect you.’
I said, ‘I didn’t say it! Carl Levin said it!’
RUSH: It was to Daniel Sparks that Carl Levin dropped the S-bomb several times. Now, of course, he was quoting Goldman Sachs executives, naturally, in e-mails. Now, Carl Levin. Carl Levin runs a government oversight committee where he has the ability to issue subpoenas without the vote of the committee itself. That is very unusual on Capitol Hill. Carl Levin is the Democrats’ top smear guy. Carl Levin collects information from his targets, he twists and spins the information, he then leaks it to the media, and then he holds hearings like this. He did it throughout the Reagan administration as well. Nothing Carl Levin says can be trusted. Not one thing. Now, as you well know, Warren Buffett is one of Obama’s boys, and Warren Buffett is a major stakeholder in Goldman, and George Soros is one of Obama’s boys.
Or maybe I should say, ‘Obama is one of George Soros’ boys,’ and that could be one of the reasons why we’re not seeing a whole lot of televised activity on the popular cable channels about this. Millions of e-mails are created by companies. They are being used selectively. Now, I’m not defending Goldman. That’s not to say they’re wonderful. But this is how kangaroo courts work. This is a show trial. I would love to see all the e-mails created in Carl Levin’s office since he’s been a Senator, which I think dates back to the mid-seventies. I wonder if any of Carl Levin’s e-mails, internal e-mails to his staff or other senators, say something like, ‘Let’s screw these guys,’ or, ‘Let’s not use that information. Let’s withhold that information,’ or, ‘Look, let’s leak this.’
We know that Jay Rockefeller prepared a memo for internal use on how to politicize 9/11 and a number of other things against George W. Bush, to turn the Democrats’ position from supporting the invasion of Iraq around to, ‘We were lied to! We had no clue,’ blah, blah, blah. It was an internal memo. So we know these Democrats do exactly what they accuse everybody else of doing. So I would invite Senator Levin to make his e-mails available to the public since that seems to be an important standard here for going after whoever the enemy of the regime happens to be on a daily basis. Now, yesterday, Dingy Harry failed in his test vote on the new financial regulatory reform bill, and he turned around at the end of the vote and voted ‘no’ which allows him to bring it up again today.
And he’s going to keep bringing it up because the whole point of the vote on the financial regulatory reform bill is to embarrass Republicans and to make Republicans the evil accomplices of Goldman Sachs and all of these evil Wall Street guys — when in fact the giant bed in which everybody is sleeping and doing who knows what else contains Democrats and Wall Street fat cats, not Republicans. The whole point… This is why I said last week: There is nothing that Obama does that ends up winning on the basis of policy. Obama cannot convince anybody of the supremacy or the superiority of his ideas. He uses thuggery and traditional political shows to make political points, to embarrass enemies, to create public opinion against his opposition because his ideas fail in comparison to his opposition.
Senator Ben Nelson, Nebraska, voted against the bill yesterday — the financial reform bill — and why? Because he’s the Senator from Nebraska, and that’s where Warren Buffett lives, and Warren Buffett wants no part of this bill until his company’s involvement in derivatives is exempted. He wants to be exempted from whatever new regulations there are. The whole financial regulatory reform bill is filled with exemptions for the typical big cronies of the Democrat Party. We’re going to be getting into the details of all of that as the program unfolds before your very eyes. All right. To the audio sound bites. This is Carl Levin this morning in Washington, a portion of his opening remarks into the inquisition against Goldman Sachs.
LEVIN: The evidence shows that Goldman repeatedly put its own interests and profits ahead of the interests of its clients and our communities. Surely there is no law, ethical guideline, or moral injunction against profit. But Goldman Sachs didn’t just make money. It profited by taking advantage of its clients’ reasonable expectation that it would not sell products that it did not want to succeed. Its conduct brings into question the whole function of Wall Street, which traditionally has been seen as an engine of growth betting on America’s successes and not its failures.
RUSH: Folks, this has me fuming. What Levin here is essentially saying is that Goldman Sachs had devised not one, but a series of complex deals to profit from the collapse of the home mortgage market. Now, isn’t that precisely what an investment firm should be doing for its clients? Would it not be irresponsible for them to do anything else? What are clients of Goldman Sachs supposed to do other than profit from hiring them? This is what’s wrong with — and you might be saying, ‘But, Rush! But, Rush! This is a housing market. This was the American dream and Goldman Sachs is betting on it to fail.’ Well, they bet both ways, but people bet short all the time. Are we going to eliminate going short on every financial transaction now? Because there’s a winner and loser. It’s a zero-sum game, folks.
For every winner there’s a loser. I don’t care which way the winner or loser goes. Sometimes the short seller loses; sometimes the long seller loses but somebody wins. Now, if Goldman Sachs has a bunch of clients and they’re sitting there and their job is to analyze a particular market and they’re looking at the home mortgage market or the subprime thing and if the analyst at Goldman Sachs says, ‘You know, this is a house of cards and this is going to collapse,’ is it not their responsibility to their investors to come up with ways for their investors to profit from this? ‘Rush, how can you say this! How can you say people should profit from something in the market that’s falling?’ It happens every day.
Remember, the housing market bubble was created not by Goldman Sachs. The housing market bubble was created by — you want the names? — Jimmy Carter, Bill Clinton, Barney Frank, Chris Dodd, Franklin Raines, Jamie Gorelick and ACORN. The whole subprime mortgage market was created to put people into homes who could not afford them in the first place. Anybody in their right mind would know this is a house of cards waiting to fall, and at some point somebody wants to make some money off of that. Where is it written that we are not allowed to make money off of government stupidity? People do it every day. There aren’t just regulations on the subprime mortgage business. Government has regulations on every aspect of business, and people bet — investors — and make choices, make decisions on what a market is going to do based on whatever their analysts think. Sometimes the analysts get it right; sometimes they don’t.
But Goldman is like a bookie in the sense that they’re trying to make money on both sides of the deal. People who set the point spreads in football are not predicting winners and losers, and they don’t care. If they say Steelers -6 over the Cincinnati Bengals, they’re not hoping the Steelers win by 6. They’re hoping to get an equal amount of money on both sides ’cause one of the teams is gonna win. Somebody’s gonna beat the spread or not. They just want to make sure they don’t take a bath at the end of the game. Same thing here. Except this involves not… You can look at this gambling, but this involves real, live events taking place in the economy: the mortgage market, the housing market, silver, commodities. This stuff happens every day. I’m not saying everybody involved in it is clean and pure as the wind-driven snow, but this effort here…
I’ll bet you there aren’t five people on Capitol Hill in the Senate or the House who have the foggiest idea how Wall Street works, how the free market investment system works. They sit there and they regulate it each and every year and each and every day but they haven’t the slightest clue. They get on to sit around as spectators and when something happens they don’t like, particularly in an election year, then they can fulfill a myth that is a page in their playbook. In this case: ‘Wall Street, rich, fat cats, big bonuses, evil, capitalizing on human loss, capitalizing on human pain.’ What human pain? Have these people been kicked out of their houses? Who are the big losers in the subprime crisis? Who are the big losers? The people who got their homes in the subprime crisis largely are still there. They were never able to pay the loans back. This was the point.
The big losers in the subprime crisis are the people forced by government to go along and finance this, and they were financing worthless ideas so they had to come up with ideas to make these worthless ideas worth something, hence collateralize debt obligations and all that. When the government tells you that you gotta do something and they have oversight control over you and regulatory control, you snap to. Corporate cronyism! If Janet Reno calls you and says, ‘You better make these loans or worry we’re going to conduct an investigation which could fine the bank or put it out of business,’ what do you do? Okay, you go ahead and you do it, but you’re a free market guy, you’re an entrepreneur.
You’re saying to yourself, ‘Okay, they’re going to make me loan money to people that can’t pay it back. I’m going to have a bunch of mortgages that are worthless, because the people paying ’em back cannot possibly pay ’em back. So I gotta figure out: How can I either game the system so the government will bail me out at the end of all of this or how can I game the system so that I can concoct a way to package these mortgages in pools that other people will buy, and they take the risk that these things are going to be worth something or worth less?’ So you have creativity and entrepreneurism going on here, and it is the result of the market: The referee entering the game. The referee is the government. They enter the game by demanding that banks make loans to people that they otherwise wouldn’t touch, and that’s why the housing bubble occurred, and that’s why we’re here today.
So the very people that caused it, including Carl Levin, are now seeking the occasion to once again blame the people they forced to do this while they get to act as innocent bystanders and then cream these people by reputation, tie them to the Republicans, and create all of this phony anger over class envy and all the things that are itinerant to that. So that’s basically what is happening here. Now, don’t misunderstand me. I am not — and I never do this anyway — saying that anybody here is clean and pure as the wind-driven snow. In fact, I’m still not convinced that Goldman isn’t in on this. At the end of the day, you know, they’ll pay a $500 or $400 million fine at the end of this in exchange for a couple of billion dollars in profit down the road. I mean, the deal is Goldman goes along with this, they take the hit, Republicans get tied to them, Democrats win in November (or don’t lose as bad in November) and all is well. George Soros continues to destroy the economy and profit from it. Warren Buffett gets his exemptions from his derivatives and the whole deal is sealed. That’s the cynic in me.
RUSH: A little bit more on Carl Levin. Carl Levin said the surge failed back in February of 2008. Carl Levin, one of the major forces behind the bailout of GM and Chrysler, Michigan. Now, the central charge against Goldman Sachs — let me make this simple. Simple charge is the SEC is suing Goldman and they lost $90 billion. Goldman lost $90 billion in the case that they’re being sued for. Where did it profit? Carl Levin had a hand in creating the housing bubble. The central charge here, ladies and gentlemen, against Goldman Sachs is that they did not inform their clients as to all the details of the package they had put together. Now, if that’s true, where are these clients who got screwed? Who are these clients that got screwed? Why did these screwed clients just sit around and stay screwed? Why didn’t they sue Goldman Sachs? Why aren’t these clients who got screwed testifying? I mean these are the losers, right? These are the people that got scammed. That’s what we’re being asked to believe, that Goldman scammed a bunch of people. Well, who are they? Where are they?
See, the dirty little secret is that there are no losers. Even the government at the end of the day got paid back with a profit. All these people ended up getting bailed out. The only people that didn’t were the bondholders at Chrysler. But the screwed aren’t the screwed because the screwed didn’t stay screwed. The scammed aren’t the scammed ’cause the scammed didn’t stay scammed. Had they been scammed you would have been hearing about them long before Carl Levin popped open about this. The banks had to give out these bad loans or face getting a bad Community Reinvestment Act rating, and that’s what they were being threatened with by Janet El Reno and others. If you’ve got a low Community Reinvestment Act rating, the government would punish in you any number of ways, because the Community Reinvestment Act was financial regulation. What else would you call it?
So here these banks subject to financial regulation, they’re being told what no trained banker would ever do, ‘Loan money to Zeke and Mary Oxcord,’ who can never pay it back. And the Oxcords get their house, and they’re living there and they’re fat, dumb, and happy. And Barney Frank’s happy because (impersonating Frank) ‘We have affordable housing in America now, that’s right, affordable housing.’ And now Barney is out there saying, ‘I never said that. I said people should wait. I didn’t say lend money they couldn’t pay back.’ Yes, you did. You did it over and over and over again. So to enforce the Community Reinvestment Act financial regulation, federal regulatory agencies examine banking institutions for compliance, they take this information in consideration when approving applications for new branches, or for mergers and acquisitions. These banks have no choice. They’re being regulated, they’ve got to do what the government says if they want to expand in other areas, and this Carl Levin and this committee and this entire regime now going after Goldman Sachs is as phony as a three dollar bill. Can I say that anymore?
RUSH: Oh, yeah, right now there is no criminal allegation against Goldman. It’s all civil. Now, if they do find evidence of fraud, then there’s a big problem. But so far, Goldman hasn’t done anything illegal except try to profit from the game that the government rigged. This is why Goldman will pay a huge fine, ’cause if this case goes before a jury, Average Joe will send Goldman to the hoosegow for 50 million years, with no get-out-of-jail free card. That’s what the Democrats know. The Republicans know it, too.
RUSH: All they’re going for in these Goldman Sachs hearings today are sound bites. It’s a sound bite hearing. Here, before we get back to Arizona, grab sound bite 28. This is Claire McCaskill out of Missouri blaming America’s unemployment on a few Goldman deals that they described with the S-bomb that she describes here, and she reads their e-mails and so forth. But this is just a sound bite hearing. It’s just for one Democrat after another to get some sound bites for future ads or for the State-Run Media to use in news reports.
MCCASKILL: We are trying to hone in on why I’ve got so many unemployed people in my state and why so many people that I work for in Missouri have lost incredible amounts of money in their pensions. I want to look at these two transactions and I want to talk a little bit about Timberwolf. In a document dated November 10th of 2006. This is the memorandum. You talked about the ‘asset selector’ and that’s where you learned that this firm that you picked on the asset selector on that, you had Greg — uh, who was a partner at Goldman Sachs and was cohead of the structured products group — focused on structure product opportunities. Of the 26 members of the research investment team that were researching these assets to go into this synthetic derivative, this is the same one that your folks called (bleep).
RUSH: Ah, there it was! There was the S-bomb. They’re all using it today in quoting Goldman Sachs e-mails. So now Goldman Sachs is responsible for America’s unemployment. That’s the sound bite from Claire McCaskill.