Former Goldman Sachs Group Inc board member Rajat Gupta was convicted on Friday on criminal charges of illegally tipping his hedge fund manager friend Raj Rajaratnam with corporate secrets.
A federal court jury in Manhattan found Gupta guilty of three counts of securities fraud and one count of conspiracy, ending the four-week-long trial. He was found not guilty on two other securities fraud charges.
The jury delivered the verdict on the second day of its deliberations
“The president is evading federal law on the use of the military by having the now-paramilitary CIA kill people in foreign countries with drones and disrupt a foreign population with a cyber-war. And he is violating the Constitution and federal law by starting wars on his own. But the loudest and most sanctimonious of politicians are not demanding that the president follow the Constitution and the laws he has sworn to uphold. Rather, they are demanding to know who told the media about the president’s war making.
Which is ultimately more harmful to freedom: that the president on his own kills and maims and destroys, or that some people in our own government who have greater fidelity to the Constitution than loyalty to an out-of-control presidency – and who are protected by law when they reveal government crimes – tell us what the president is up to? What kind of politicians complain about truthful revelations of unconstitutional behavior by the government, but not about death and destruction, and, let’s face it, criminal abuse of power by the president? Only cynical power-hungry politicians who have disdain for the Constitution they have sworn to uphold could do this with a straight face.
The president’s use of drones and cyber-warfare to kill people and to destabilize a foreign population, without a formal declaration of war, is the moral equivalent of an illegal war. When President Nixon started a war on his own in Cambodia, Congress enacted legislation over his veto to prevent that from happening again. Yet, the members of Congress who are demanding to know who told the truth to the media about President Obama’s war making apparently agree with his unlawful use of the war-making power he has stolen from them.”
The U.S. government is currently being run by war criminals. They have no respect for law. I suggest that Americans donate nothing to either major political party. I suggest that Americans attend no speaking engagements of either Romney or Obama or their minions. Rallies should be boycotted. I suggest turning off the tv for both conventions. I suggest not voting for either major party candidate. I suggest not voting at all, but if you feel that you must vote, then write in a candidate who stands for peace and a law-abiding government. I suggest boycotting the intellectuals and media figures who support these war criminals. There are hundreds of nonviolent things one can do to register one’s antipathy to war criminals running the U.S., ranging from videos to bumper stickers to tea shirts to banners and more. Free speech is more important than ever. Use your imagination. Do what you can in light of your personal situation. There is no single answer. I don’t pretend to know what to do when a country has been taken over by thugs as this country has. I don’t pretend to have a recipe for political action.”
Mark Twain, on the trials of Joan of Arc:
“Throughout the Trials, whatever the foredoomed witness said was twisted from its true meaning when possible, and made to tell against her; and whenever an answer of hers was beyond the reach of twisting it was not allowed to go upon the record. It was upon one of these latter occasions that she uttered that pathetic reproach — to Cauchon: “Ah, you set down everything that is against me, but you will not set down what is for me.”
That this untrained young creature’s genius for war was wonderful, and her generalship worthy to rank with the ripe products of a tried and trained military experience, we have the sworn testimony of two of her veteran subordinates — one, the Duc d’Alençon, the other the greatest of the French generals of the time, Dunois, Bastard of Orleans; that her genius was as great — possibly even greater — in the subtle warfare of the forum we have for witness the records of the Rouen Trials, that protracted exhibition of intellectual fence maintained with credit against the master-minds of France; that her moral greatness was peer to her intellect we call the Rouen Trials again to witness, with their testimony to a fortitude which patiently and steadfastly endured during twelve weeks the wasting forces of captivity, chains, loneliness, sickness, darkness, hunger, thirst, cold, shame, insult, abuse, broken sleep, treachery, ingratitude, exhausting sieges of cross-examination, the threat of torture, with the rack before her and the executioner standing ready: yet never surrendering, never asking quarter, the frail wreck of her as unconquerable the last day as was her invincible spirit the first.
Great as she was in so many ways, she was perhaps even greatest of all in the lofty things just named — her patient endurance, her steadfastness, her granite fortitude. We may not hope to easily find her mate and twin in these majestic qualities; where we lift our eyes highest we find only a strange and curious contrast — there in the captive eagle beating his broken wings on the Rock of Saint Helena.
III
The Trials ended with her condemnation. But as she had conceded nothing, confessed nothing, this was victory for her, defeat for Cauchon. But his evil resources were not yet exhausted. She was persuaded to agree to sign a paper of slight import, then by treachery a paper was substituted which contained a recantation and a detailed confession of everything which had been charged against her during the Trials and denied and repudiated by her persistently during the three months; and this false paper she ignorantly signed.
This was a victory for Cauchon. He followed it eagerly and pitilessly up by at once setting a trap for her which she could not escape. When she realized this she gave up the long struggle, denounced the treason which had been practiced against her, repudiated the false confession, reasserted the truth of the testimony which she had given in the Trials, and went to her martyrdom with the peace of God in her tired heart, and on her lips endearing words and loving prayers for the cur she had crowned and the nation of ingrates she had saved.
When the fires rose about her and she begged for a cross for her dying lips to kiss, it was not a friend but an enemy, not a Frenchman but an alien, not a comrade in arms but an English soldier, that answered that pathetic prayer. He broke a stick across his knee, bound the pieces together in the form of the symbol she so loved, and gave it her; and his gentle deed is not forgotten, nor will be.”
Comment
This is Twain’s description of the betrayal of Joan of Arc, from a book on which he labored for years. He considered it his magnum opus. I posted the piece..which I find endlessly inspiring… to suggest that change doesn’t come about by numbers – this is the corporatist-communist approach.
It comes about qualitatively, spiritually.
The mass following will come automatically when the moral force and the vision come into being. For that, you need only one person, really.
And that person can be utterly defeated, yet change will come.
Because the world is made by thought-force…soul-force…. as Gandhi called it.
So it’s an individual thing. A lonely thing, if you will If speeches and parades could have changed things, they would have. There have been enough of them. They won’t. The current system is guaranteed to do that. It’s set up to neutralize public protest, or to turn it into an occasion for repression.
So Ron Paul can be defeated and even neutralized….but whatever was real in his words…will survive on their own.
Lots of gaseous anger floating around at Rand Paul..and Ron..these days.
Fair enough.
Except don’t say someone “sold you” a bill of goods, without also adding you “bought” it.
I don’t know how anyone could fairly say that they were surprised by Rand Paul’s endorsement.
He’s never pretended to be anything other than a liberty-oriented Republican. Can’t fault him for your own psychological projections.
So here goes – top ten dumb reasons to hate Ron and Rand Paul.
I
1. Ron Paul makes strange finger signs that look occult. He’s a Freemason and it’s an Illuminati plot.
1. Ron Paul might be a Freemason and the Illuminati are always plotting, but that is neither here nor there. The question is whether he’s a globalist. He isn’t, at least, not on paper.
The next question is whether he’s fronting for the globalists in some deeper manner, by co-opting the opposition, either intentionally with devious intent (Webster Tarpley), or unintentionally or more or less reluctantly (I’m in this camp).
As for hand signs – practically anything you do with your hands can be twisted into occult symbolism by a clever picture.
Give it a break.
By the way, the word “occult” only means “hidden”. It does not mean “creepy sexually perverted rituals committed under the statue of an owl,” no matter how many times Alex Jones said it does.
Creepy, sexually perverted rituals committed under owls…or even by owls…are just that. They can be committed by occultists, sure, but they can also be committed by Baptists and atheists. Some people might think it’s a pretty creepy ritual to eat the flesh and drink the blood of a guy who was put to death two thousands years ago.
Try reading a book, say, by Francis Yates or Mircea Eliade or Ananda Coomaraswamy, or Manly Hall, before getting your ideas about the “occult” from Google.
The occult just refers to the wisdom or esoteric tradition of the West. Most of it is remarkably similar to Eastern religions like Hinduism. Jesus Christ was, in many ways, an “occultist.”
II
2. Rand Paul sold us out by endorsing Mitt Romney.
2. Rand Paul always showed he was sympathetic to Mitt Romney by every gesture and word. If you didn’t see that, consider LASIK, but don’t upchuck all over the forums.
Credulity isn’t something to be put on your resume.
Rand Paul’s Republican tendencies actually gave me some hope for him as a politician, although personally I don’t think politics is the arena in which real – as opposed to superficial – change takes place at all. So all the angst is redundant. Be sorry for wasting so much time and energy on a political campaign you apparently mistook for the return of Merlin…but that might not be entirely Rand Paul’s fault, eh?
Time to check the mirror.
III
3. Ron Paul was only feathering his nest and setting up Rand for a political career.
3. Your point? If Ron Paul were as much as a saint as his supporters wanted him to be, he wouldn’t be in politics at all. He’d be in a monastery or a cabin in the woods.
He’s not only a politician, he’s a successful long-lived politician, who has many friends all over the place, made good money, and sold a bunch of books on the strength of his public visibility. This is not a bad thing in my book, but it kind of argues against him being a Trappist monk. He’s more of the “doing good by doing well” school
(see Rajat Gupta and public-private partnership for a more mainstream corporate version).
Look, libertarians believe that self-interest is a great and productive instinct in man. How could you expect their hero to be martyr material? He’s not. And I’m sure he doesn’t want to be. That may be a failing in libertarianism, but don’t blame Paul for not alerting you. It’s practically tattooed on his forehead.
IV
4. Ron Paul is a goldbug shilling for a gold standard that will support the bankers.
4. Ron Paul is a gold bug, Ron Paul is shilling, Ron Paul is for the gold standard, and Ron Paul is supporting the banksters are four separate propositions that have no necessary connection between them and need to be proved independently.
The sooner you figure that out, the sooner you will upgrade from ‘unpleasant internet bot’ to ‘rational thinker who can argue a point without having an epileptic fit.’
V
5. The Ron Paul movement is dead, and now there’s no hope for liberty in the world.
5. This has to be the most annoying bit of narcissism I’ve come across. There are more than a hundred other countries in the world, and several billion people, most of whom don’t speak English and have never heard of Ron Paul. Some of them have never heard of America. Amazing, huh? They’re all seeking liberty in their lives in different ways. More than one of them is likely to do more for liberty than Ron Paul has. That’s not a slap at Ron Paul, who’s done a lot. It’s a slap at a very insular way of thinking. You don’t Co-Chair The Committee on Global Liberty with the seraphim and cherubim. You really, really don’t.
VI
6. The globalists can’t be stopped. it’s all the fault of Ron and Rand Paul. If they’d only….
6. The globalists probably can’t be stopped overnight by anyone. Not even by God (see, Free Will). For overnight instantaneous transformations of thoughts into matter, you need more than a different political campaign. You need a different planetary vibration (see, Occult).
VII
7. Webster Tarpley said, Alex Jones said, Eric Dondero said, Mark Ames said, Jesse Benton said…..
7. It’s OK to read and discuss what anyone with a big net presence has said about Ron Paul. But none of it is the last word. We’re not likely to know all the facts about why some public figure said or did something, so drawing too many conclusions too, well, conclusively, isn’t smart.
All of these people also have their own agendas and viewpoints. Don’t make a decision about gold or paper money, based on “it will profit the globalists.”
Rest assured the globalists have a million ways to profit from any economic regime…..paper or gold or cowrie-shell.
Make up your mind about whether you want to buy or sell gold or buy currencies or anything else based on your own research into fundamental and technical factors, not playing off the binary
Gold=Good/Paper=Bad…
or
Paper=Good/Gold=Bad
VIII
8. Mitt Romney is EVIL EVIL EVIL. Anyone who supports him is EVIL EVIL EVIL. Barack Obama is EVIL EVIL EVIL. Anyone who supports him is EVIL EVIL EVIL.
8. Projecting absolute evil onto a political figure, a political position, or anything else is a flawed way of thinking. Human beings pursue what they consider good. That “good” might in reality cause a lot of harm and damage to millions of lives, but that still doesn’t alter the fact that the person doing the damage is usually doing it in the pursuit of what he considers good. Understand that and don’t create demons where none exist. Romney is wrong when he does x,y, and z, and I would prefer that he did a, b, and c, is much more persuasive than Romney (or Obama) is evil.
IX
9. Ron Paul has made me lose interest in politics. What a jerk.
9. Actually, this is probably the brightest part of the whole story. The more people lose interest in politics, the better. Not the wrong kind of losing interest that makes you gullible and easy to manipulate. But the right kind. When you don’t waste time looking for political (mass) solutions but try to figure out smaller, local problems. Instead of voting for Ron or Rand, try changing one municipal ordinance you hate.
X
10. Ron Paul wasn’t straight with us. He’s a fraud and a con.
10. Ron Paul, buddy, has no obligation whatsoever to be straight with you. Did he marry you and swear to stick with you through rich or poor?
Ron Paul is obligated to follow the law, especially the constitution, and the and any appropriate limitations imposed by our intelligence services. You might not like that. But those are his only legal obligations.
Ron Paul also has a media presence. If he wants to keep it, he CANNOT be straight about anything and everything.
If he were, he’d be gone tomorrow and writing a blog.
Which isn’t a bad thing, from my point of view, but all you guys who love cute Ron Paul T-shirts and mugs, crowds, tents, group “highs,” clever slogans, and plenty of traffic, will simply hate it.
Ron Paul gave all of that to you, just as surely as you gave all your energy and money and time to him.
It was a voluntary capitalist exchange, which is just what he stands for.
He didn’t promise you you’d win a million bucks, make the Superbowl, score a hot chick, or grow back all your hair.
He didn’t even promise to be president or hate Mitt Romney forever.
Yeah, you feel he let you down.
Smoke a cigarette.
Feelings don’t produce obligations.
You had a good ride and he did too. Take it gracefully.
Whatever else he is, was, or might have been, Ron Paul was a graceful and gracious man.
Leave it at that.
Scam charities, like Bernie Madoff? No problem. The SEC and the FBI will look the other way…just like they did for years, while Madoff ran a ponzi scheme under their noses.
Scam the tax-payers, like Citi, Goldman, AIG, Solyndra? No problem. Here, take some more from them.
Scam the mom-and-pops, like MF Global, Citi, Countrywide?
So what? Someone’s gotta keep the suckers down.
But hey, front run Goldman Sachs and its pals, like Raj Rajaratnam and allegedly Rajat Gupta, now we’re talking jail time.
Rajat Gupta might be guilty…or innocent…of insider-trading.
But this trial isn’t really about insider-trading. In case you didn’t notice, insider trading is Goldman Sachs’ business model.
This shouldn’t be too surprising for anyone who’s been keeping their ears and eyes open.
Check out my comments at Veterans Today on a Sybil Edmonds piece on Bruce Fein
and my comments at Deep Capture at the bottom of this piece.
And at Economic Policy Journal and at The Daily Bell.
(I’ll put the multiple links above and my previous posts), not to gloat, because I feel very bad about this for all the poor people and even the Paulbots (just a joke) who slaved away, contributed and put their credibility on the line for these two and now have egg on their face. I hope Ms. Freeman is only expressing a dark view and not the whole story…because a lot of people are going to feel very taken.
And that includes me too. …except, I don’t close my eyes when I see something I don’t like. I reevaluate things.
A lot of an-caps don’t. That kind of dogmatism is not reason. It’s emotion. And emotion blinds you to reality.
There were always these real problems with Ron Paul, as far back as 2008.
1. Too tied in to the financial world (especially the hard money network, which is riddled with intelligence operatives and propagandists)
2. His campaign showed too much nepotism
3. The campaign was too slick in marketing. They came off just like any other politician
4. There was too much money raised for what he seemed to be doing and no clear explanation of how it was used.
5. Too many Zionist advisors prominent in his following who appeared to have a disproportionate role.
6. Too much pandering to the left and to the media on some things – not critical enough of Assange; not critical enough of many of the trendy liberal-left positions (pro-porn, for eg) that actually support corporate interests.
7. Too many expedient decisions along the way.
8. Too tied into the internet newsletter community, marketing. Not enough criticism of corporate practices and ethics.
9. Didn’t support the people who are actually fighting the banksters (Byrne and Co on the right; Naked Capitalism on the left).
10. Used many decent people badly. This is what I hold against them most. I think many of the very credible and sincere people at LRC, including Lew R. himself, Tom Woods and a few others, now look gullible. Have to say they got a warning about that from Wendy McElroy. That went unheeded by Walter Block. He along with Kinsella and Hoppe may be heroes to some core constituency, but from where I stand, they aren’t the best spokesmen for liberty, since they advocate positions that deny it to substantial numbers of people.
Anthony Wile at The Daily Bell is taking the position that this sell-out doesn’t matter and the important thing is that Paul educated a lot of people.
Yes, he did that. And yes, he also struggled for a long time, taking the message where he could, in the face of ridicule and slander. And yes, he probably knows better than most that you can’t fight “city hall.” He’s old and he’s done his bit…..more than a bit, a tremendous amount.
Well, this is a smart position to take, for one’s own psychological health, but it’s not very truthful. Paul’s influence was not just benign. It has had its dark side.
By running a campaign that sucked money and energy from the whole grassroots opposition to war and the police state, he bled that energy and money away from initiatives that needed more support and might have done something more substantial (although, I’ll admit that’s hypothetical..and although, in my view too, education is a huge and important foundation that has to be laid before real long-term change can come.
More importantly, he distanced himself from the active fight against the money-power that was taking place at Deep Capture, a forum which endorsed Paul, but never received a word of support in return.
People have been killed trying to unravel the whole story of the grip of the intelligence networks on the United States. People have impoverished themselves to write what had to be written, they’ve been sued and fled the country, they’ve been hounded and killed by the government.
Those are libertarian heroes in my book, not people who weren’t prepared to forsake the comforts of life, career, and networks….and more disappointingly, seemed to distance themselves from those who did.
To be honest, I’ve come to believe there are more libertarian heroes on the left and among conservative Christians, than there are among most anarcho-capitalists, who, seem to confine themselves to theory and advocacy but not to the battlefield where all of that must hit the ground…
How could it be otherwise, since most of them have such a limited idea of self-interest. “Mind your own business” is not likely to produce heroes, at least, not outside your own family.
Don’t blame that on Ayn Rand, who had a much deeper view of self-interest and values. I tend to blame it on Murray Rothbard’s influence, but that’s a judgment I’m not yet fully comfortable with. It’s possible I need to understand him more.
No. Ron Paul is not a villain at all. But he wasn’t the savior the libertarian grassroots believed him to be. That has already been made clear.
And the fall out will be painful for the true believers.
The rest of us will just chalk one up to observation, over ideology, and to individualism, over mass thinking.
And then we’ll turn off this show… and tune into the bubble in the next messiah…..
Just wonder what would happen if Gary Naftalis, lawyer for Rajat Gupta, the former Goldman manager on trial for alleged insider-trading, asked Lloyd Blankfein if he’d ever shared confidential Goldman information himself….you know, with one of his swanky neighbors in New York, say, Daniel Seth Loeb (Mr. Pink of feminine hygiene fame), who manages billions for hedge-fund, Third Point LLC..
Loeb, allegedly part of the network of sometime Sith Lord, Michael Milken (also of insider-trading fame), is what’s called an activist hedge-fund, which is a nice way of saying he actively influences the price of the stocks he shorts/buys (all for the greater good, of course, but fortunately it coincides precisely with Mr. Loeb’s good too, which is so nice, especially when your hedge-fund is down).
Of course, one guy’s activism is another guy’s market manipulation, but I came not to quibble.
Daniel…Danny to his friends…is also good at digging up… er…doing research on the companies he shorts and employing public message-boards to intimidate company officers with information both relevant to their duties and relevant only to the purpose of intimidation (see also, harassment) .
He employs for that purpose the very interesting corporate intelligence firm of Julius Kroll, which every 9-11 researcher knows…
Kroll has ties (would you call those insider ties?) with Maurice (Hank) Greenberg through its purchase in 2004 by Marsh & McLennan, an insurance brokerage firm owned until 2005 by Jeffrey Greenberg, Hank’s son. Greenberg has been chief of C.V. Starr (CIA-linked), of Starr International, and until 2005 of AIG (also CIA-linked)…..
but I digress…
Where was I? Oh yes. Insider trading.
I just wondered about it in my little ole way, because digging (just like Kroll!) through my archives, I ran into this note about how…sort of like biorhythms or crime-waves following the phases of the moon… there were a string of exits, literal and figurative, among some of these Goldman- Third-Point-activist-outsider-insider-letter-writing types at certain opportune moments. To wit.
“Goldman’s chief hedge-fund manager, Pierre-Henri Flamand (chief of GS Principal Strategies), retired in February after 15 years at Goldman. Flamand was with Principal Strategies from 2002 -2007, and then turned it into a hedge-fund in 2008, is starting his own fund. He’s being replaced by another manager from GSPS. Goldman has been accused of conniving with select hedge-funds to conduct bear raids on banks and governments.
Meanwhile, Adam Sackett, co-chief of trading at Third Point Capital, died on March 11, March 10, Wednesday night, apparently from a sudden bacterial infection. Third Point is one of the hedge-funds accused of colluding with David Einhorn’s Greenlight and SAC’s Steven Cohen in manipulative activities. Sackett had previously worked at Jim Chanos’ hedge-fund Kynikos (suspected by some to be part of that group), according to this death notice in the New York Times.
Note: Bankruptcy examiner Anton Valukas’ report on the demise of Lehman came out on March 11, 2010, the day after Sackett died.
Our condolences to the family.
In a letter to investors, posted at scribd, Daniel Loeb, Sackett’s co-chief at Third Point, called him “brilliant, kind, and funny, ” says the WSJ.
Last year, Third Point lost three senior officers, its chief operating officer, Brian Wilson, chief risk officer, Devin Dellaire, and head of investor relations, Tom Kratky.”
Tut. The last thing you want at activist hedge-funds is inactive officers. But there — happens to the best of us.
And Loeb is among the bestest of the best, we hear. So good that he gets to be neighbors with big shots from Citigroup and Goldman “we don’t do insider trading” Sachs at 15 Central Park West.
That’s this swanky place in New York:
And, dang, if that isn’t a nice picture of Lloyd Bankst – I mean, Blankfein. Guess if you have to do God’s work, you might as well do it in a duplex worth $26 mill, huh?
[I have to say me..being a wog schwartze ‘n all…I couldn’t quite get the hang of what could’ve possibly cost $26 big ones in the place…but as they say, if you got it, flaunt it..]
And here’s Sandy Weill (former chief of Citigroup) flaunting his digs – worth $46 mill – at 15 Central 
Park West. (Love the smile, Sandy). And then there’s Daniel Ochs (hedge-fund manager) and …but I digress, again.
Danny (to his foes, Senor Pinche_Wey – look that up) Loeb paid nearly as much as Sandy for his 8 bedroom apartment (45 million in 2008). He wants to sell it for 100 million this year.
Nice.
But what I was really getting at, in my clumsy way, is could Mr. Gary Naftalis please inquire if Mr.Lloyd Blankfein, in his neighborly walks from his apartment ($26 million) to the lobby and back, and up the elevator, and down, and in the door, and out..and waiting to catch a cab, or go to a restaurant, ever run into Mr. Loeb?
And if he did, did he chat? And if he chatted, as I hear he did, did he ever say anything about Goldman? And if he did, did he ever…just accidentally…let on about something that was confidential? I mean, I know how Mr. Blankfein is so big on confidentiality and how careful they are with even the appearance of wrong-doing at Goldman Sachs.
So careful, that their senior executives have begun jumping ship on the front pages of the international press.
Here’s how one of its clients, Marvell Technology Group, saw Goldman’s impeccable culture:
“Dr. Sutardja and Ms. Dai founded Marvell Technology Group, a worldwide semiconductor company in 1995. Goldman Sachs managed the IPO for Marvell and put the two executives into its Private Wealth Management Group. It is alleged that once the two executives’ personal wealth was under the financial management of Goldman Sachs, the firm abused the two executives’ trust, manipulated their relationship, and ultimately defrauded them of several hundreds of millions of dollars.”
And if Mr. Blankfein, like Brer Rabbit, jes’ lay low ‘n didn’t say nuffin’, how should we understand a passage like this one:
“Multiple media stories (such as this one in “Investment News”) have speculated that Goldman Sachs actually designed these CDOs in such a way that they would be certain to implode, delivering large profits to Goldman and preferred hedge fund clients. Those CDO could not have been created without Einhorn and his allies inside New Century delivering the mortgages that went into them. And there is no doubt that Goldman Sachs delivered the knock-out punch that put New Century out of business, ensuring that the CDOs would, in fact, implode. This constellation of facts may be coincidental, of course. Or not. This essay lays them out, and leaves it to the reader to decide.
New Century’s problems began in December 2005, when board member Richard Zona drafted a letter in which he threatened to resign if senior executives did not agree to sell a greater percentage of the mortgage loans on its books to various banks, such as Goldman Sachs. In his letter, Zona explicitly stated that he was making this demand in league with David Einhorn and Dan Loeb.
Unfortunately, according to the bankruptcy report, New Century’s executives never saw that letter. Zona stashed the draft letter on his computer and instead submitted a letter making a similar demand, but omitting all mention of Einhorn and Loeb. In all likelihood, Zona changed his letter because he knew that New Century’s executives had good reason to doubt whether Einhorn and Loeb, who had recently reported large shareholdings in New Century, were acting in the company’s best interests.
As Deep Capture has thoroughly documented, Einhorn and Loeb are part of a network of hedge fund managers and criminals who use a variety of dubious tactics to destroy, seize, and/or loot public companies for profit. It is not unusual for money managers in this network to appear as long investors in the companies they are attacking, and sometimes they seek to obtain a seat on a target company’s board in order to be better placed to run the company into the ground for their own private profit.
Essentially everyone in this network – including Einhorn and Loeb — are connected in important ways to Michael Milken, the infamous criminal who specialized in loading companies with debt, looting them, and then profiting still more from their inevitable bankruptcies.”
Most of all, could Mr. Gary Naftalis find out why US Attorney Preet Bharara hasn’t charged David (no relation to Danny, we hope) Loeb, who was also leaking confidential Goldman information to Galleon?
“The logs showed calls from Loeb’s phones to numbers associated with Rajaratnam and Galleon trader Adam Smith on dates when Gupta is alleged to have tipped Rajaratnam, bolstering a defense claim that it was Loeb or others who leaked data.
Loeb, whose job kept him in regular contact with hedge funds, hasn’t been accused of wrongdoing, and Frankel didn’t present other evidence that he was the source of Rajaratnam’s information.”
And why didn’t he charge Henry King, the technology analyst, another Goldman leaker, and how did he overlook the mysterious “Mr. X,” a third Goldman leaker... and why was it he zeroed in only on the luckless Mr. Gupta?
By the time it caught the attention of the Feds, Goldman – if we’re to believe the charges – had sprung more leaks than the Titanic…
Which leads to some interesting speculations.
Marvell Technology, we can safely assume, falls under the tech sector. That would be the sector in which Henry King, the leaker, worked. Marvell, with its Singapore offices, would also probably be of interest to David Loeb, head of Asia Equity sales, the other known leaker.
The one with all those ties to hedge-funds.
Would those hedge-funds include Daniel Loeb’s well-known Third Point? Especially, since, on looking up Mr. Loeb’s holdings, we find he has over 40% in technology including holdings in Marvell and in Apple.
Dan Loeb’s Third Point Offshore fund returned 3.7% during the first 5 months of 2012. Here are his top 10 holdings at the end of March:
Company Ticker Value ($000s) Activity
YAHOO INC YHOO 1,073,016 26%
DELPHI AUTOMOTIVE PLC DLPH 417,990 New
SARA LEE CORP SLE 221,221 32%
APPLE INC AAPL 217,037 New
UNITED TECHNOLOGIES CORP UTX 182,468 New
GOOGLE INC GOOG 179,547 New
MARVELL TECHNOLOGY GROUP LTD MRVL 145,503 -8%
MEDCO HEALTH SOLUTIONS INC MHS 140,600 New
FAMILY DOLLAR STORES INC FDO 136,052 New
CAPITAL ONE FINANCIAL CORP COF 119,841 New
It looks like he lost on Marvell, at least the shares he bought this year, but we don’t know what was bought in 2008…or sold…and what with all the long-short, up-down, outsider-insider, black-white, pump-dump, on-shore/off-shore, high-tech low-class complexities of hedge-funds, inquiring minds would like to know….
[June 20. I checked Einhorn and I see that he bought Marvell Technology in 20011 in the 3rd Q
“David Einhorn initially invested in Marvell Tech Group, a semiconductor company, in the third quarter of 2011. He bought 16,640,000 shares at an average price of $14. Then, he added more shares in the next two quarters and owned a total of 18,372,247 at March 31, 2012, making the holding 5.2% of his portfolio and his fifth-largest holding.
Marvell temporarily went above Einhorn’s highest average purchase price of $15.63 in the first quarter, but dropped to open Tuesday at $11.98 per share”
—
Back to Marvell. The co-founders claim that Goldman forced them to sell their holdings in companies at a loss, through margin rules, and then turned around and bought those shares for its own holdings and those of its related hedge-funds.
One instance, was in the case of tech stock, NVIDIA:
Citing clear conflict of interest, the FINRA Claim alleges no one from Goldman ever disclosed to Claimants that Goldman was increasing its holdings in NVIDIA shares, while simultaneously forcing Claimants to sell their NVIDIA shares at a loss. Indeed, according to the FINRA Claim, no one from Goldman ever disclosed to Claimants that it was trading in NVIDIA at all or that it provided investment banking services to NVIDIA.
Another was in the case of their own company, Marvell. Their lawsuit against Goldman, though, doesn’t show any evidence of Goldman or hedge-fund purchasing Marvell.
If it did, to a layman’s eyes, the scheme would seem as bad as a pump-and-dump operation.
Pump-and-dump operations often go hand-in-glove with naked short-selling, even though bashers and pumpers like to face-off on the message-boards with ripe invective.
And now we know that there’s been naked-short-selling at Goldman Sachs since documentary evidence emerged accidentally in Overstock’s lawsuit with Goldman Sachs.
That brings us back to the alleged insider trading ring Goldman had going with Third Point and its associates.
Which, again to our layman’s eyes, seems just as bad…if not a good deal worse..than the shenanigans of “Big Raj”‘s Galleon Group.
Besides, Big Raj is not on trial here. He’s already in the slammer. The trial is about Rajat Gupta, whose main mistake in this case seems to have been picking Big Raj for a friend….at least, for the time they were friends.
Which wasn’t long, by the account of Berkshire Hathaway’s No. 2 man, Mr. Ajit Jain.
Raj had gypped Rajat by 2008 says Mr. Jain.
Which means that if you’re looking for insider-rings with high-up connections to Goldman, Gupta might not be the highest up connection. Or, at least, not the only one.
I mean, it seems like if Mr. Bharara, another proud New Yorker, really wanted to know what was going on at Goldman, it would have been a lot less work to just stop by for a neighborly chat at 15 Central Park West….
Or has he?
Michael Wolff:has a really smart piece in The Guardian about the three show trials this year – each about the scandal du jour – cyberbullying of young people (Dharun Ravi); insider-trading (Rajat Gupta); and covering up adultery with campaign finance money (John Edwards). All three, he argues convincingly, demonstrate how the modern trial is more about the public and the jury’s inflated self-righteousness than it is about the facts in the case.
In fact, in all three, there was no real crime at stake.
Of course, it doesn’t mean that there wasn’t bad behavior. It just means the behavior didn’t warrant the full-blown media strobe lights and prosecutorial theatrics on display:
“Someone has to pay for being rich. (Likewise, of all the people committing adultery, someone has to occasionally pay for that, too.) In this case, the prosecutor has the further advantage that Rajat Gupta is accused of exchanging information with Raj Rajaratnam – and what does that tell you?
As for Dharun Ravi, the jury members seemed particularly gleeful in their jobs. Although nothing that Ravi did would have merited anything more than a ordinary college disciplinary proceedings (if that), were it not for the suicide that the prosecutors could not connect Ravi to, the jury nevertheless agreed that he could go to jail for a decade or more.
It took the New Jersey Middlesex Country judge, Glenn Berman, to restore, solomonically, some perspective. Judge Berman delivered the lecture that Ravi deserved, and then reduced his possible decade or more of incarceration to 30 days – in effect, tossing out the verdict and the point of the trial. Still, the prosecutors, you can figure, will not be chastened so much as galvanized by such judicial proportion.
And then, there is John Edwards. Is it possible to imagine a more preposterous prosecution? The money he used to hide his mistress was a “campaign contribution” because if voters had known he had a mistress, they surely would not have voted for him. There is something here as convoluted as the cause-and-effect chain in insider trading cases: everything that you know and are converges in a circumstance that is suspicious because it is advantageous (note: people who lose money on insider information are never prosecuted). Success is the crime. If he had been a less successful politician (and hence, less hypocritical), if he had been less self-dramatizing, if his wife had been less self-dramatizing, if his aide had been less self-dramatizing, it would have been just ordinary adultery – instead of campaign finance abuse adultery.
Would anyone argue that any of these cases would have been brought without the vast media attention that they have gotten? It is almost impossible to imagine what a jury would think, if it didn’t also understand that it was acting as the conscience of the world. If it just saw itself as an untangler and arbiter of fact, it might more reasonably pull up its nose and ask what it was doing here? I doubt any prosecutor could reasonably explain these cases – or would they even try? – if they were not inflated by social purpose and juiciness.
Trials have often existed in a tabloid world, but that is usually because they have showcased bloody dramas and primal human conflict. As the tabloid world has changed, becoming more about how men rise and fall, about who knows what about whom, and about whatever sanctimony is the flavor of the month, the great trials have, not coincidentally, become about that, too.””
One good thing to take from these three is that two of them, Edwards and Ravi, ended the right way, with the defendants winning. It shows that the legal system, even under the pressure of public opinion, can give the right answer.
Hopefully, the Gupta trial will end the same way.
It is a myth that crime is worse in the third world, compared to the US and other developed countries.
Corruption is rampant in Asia, but violent crime is actually low in per capita terms (at the bottom of world rates), although it has to be said that reporting might not be as extensive in poor countries as it is in rich ones. And in cities like Bombay (no Mumbai for me) and Delhi, it’s probably much, much higher, leading to the perception foreigners have of a seething cauldron of crime.
Still, it’s indisputable that the highest rates for violent crimes, overall, are to be found outside Asia and the Middle East, in Africa and the New World, including the US.
The Middle East and most Muslim countries are some of the safest places in the world, because street crime is simply not tolerated.
You don’t even get to take random photos of people. They have such a developed sense of privacy and such low tolerance for barbaric behavior on the streets. So-called honor-killings just don’t occur at rates comparable to street crime in the US or South Africa or the Honduras, so, on the ground, where it matters, Islamic countries actually protect women better than most other countries.
Strikingly, the highest levels of crime taken altogether are actually in the United States, mostly, it seems, the work of organized gangs.
Stories of slums and dacoits play well in the West, but relative to the enormous numbers of people in India, the actual crime rates aren’t anywhere as high as they are in, say, Colombia or even in the US.
EndOfTheAmericanDream lists some supporting statistics about American crime.
#1) The city of Detroit, Michigan literally looks like a war zone and violent crime is thriving. So far this year in Detroit, car thefts are up 83%, robberies are up 50%, burglaries are up 20% and property destruction is up 42%.
#2) Lawmakers in Illinois say that violence has become so rampant in Chicago that the National Guard needs to be sent in. In just one night last week seven people were killed and 18 were wounded – mostly by gunfire. In fact, there have already been 113 murders in Chicago this year.
#3) The city of Phoenix, Arizona has become the car theft capital of the world as millions of illegal aliens who can’t get work have found that stealing cars can be very profitable indeed.
#4) There are approximately 12 million crimes committed in the United States every single year. That is by far the worst in the world. No other nation has more than about 6 million reported crimes per year.
#5) In New York City, the number of homicides in the first quarter of the year had shot up by approximately 22 percent compared with 2009.
#6) U.S. prisons are already bursting at the seams. As you read this, there are over 2.2 million people in prison in the United States. In fact, America leads the world in the number of prisoners and in the percentage of the population in prison. The United States has 5% of the world’s population, but 25% of the world’s incarcerated population.
#7) U.S. law enforcement authorities claim that there are now over 1 million members of criminal gangs inside the country. These 1 million gang members are responsible for up to 80% of the crimes committed in the United States each year.
#8) There are over 100,000 rapes in the United States every single year. That is the highest number for any of the countries in the United Nations.
#9) According to USA Today, 58% of state and local law enforcement agencies in the United States reported that violent criminal gangs were active in their areas in 2008. That was up from 45% in 2004.
#10) Every year, one out of every five people is a victim of a crime in the United States. No other nation on earth has a rate that is higher.
In twenty years living a relatively sheltered life in mostly safe neighborhoods in the US, I’ve had, two break-ins, in which my things were stolen; I’ve been physically accosted on the road three times, and assaulted more than once; I’ve been the victim of a rental scam. I’ve had jewelry stolen twice, once by visitors. I’ve been cheated several times by merchants. I was the target of a dating scam. I was accosted by a sexual pervert. My computer’s been hacked and my telephone conversations monitored over months, maybe even a year. I was the victim of serious medical malpractice twice. I suffered intellectual property theft/misattribution several times. My car was stolen the glove box rifled through twice. I’ve been the victim of a hit-and-run driver. I was sued indirectly twice (unsuccessfully). I’ve been threatened/intimidated more than once and been discriminated against illegally dozens of times. I was slandered and harassed in the workplace once and was extorted twice. I’ve been libeled on the web scores of times. I was even subjected to false charges once….
It might be as bad in India. I don’t know. But when I lived there, life felt a lot more secure. Difficult and restricted in many ways. And I do recall eve-teasing in the form of occasional pinching and prodding of us girls on buses. Some minor short-changing in the shops.
But I don’t recall violence. I don’t recall theft.
But then again, I was one of “us” there. Here, I’m one of “them”.
SOURCES: UNICRI (United Nations Interregional Crime and Justice Research Institute). 2002. Correspondence on data on crime victims. March. Turin; UN International Crime Victims’ Survey; Transparency International; The Eighth United Nations Survey on Crime Trends and the Operations of Criminal Justice Systems (2002) (United Nations Office on Drugs and Crime, Centre for International Crime Prevention); Amnesty International; Wikipedia: Gun violence ; The Eighth United Nations Survey on Crime Trends and the Operations of Criminal Justice Systems (2002) (United Nations Office on Drugs and Crime, Centre for International Crime Prevention); World Health Organization: World report on violence and health, 2002; International Centre for Prison Studies – World Prison Brief; Fifth Annual BSA and IDC Global Software Piracy Study; GECD Society at a Glance 2001, Statistical Annex Table D3
North America > United States > Crime
Assault victims 1.2% [11th of 20]
Believe in police efficiency 89% [1st of 17]
Bribe payers index 6.2 [9th of 19]
Car thefts 1,246,096 [1st of 46]
Drug offences 560.1 per 100,000 people [4th of 46]
Executions 42 executions [5th of 22]
Gun violence > Homicides > % homicides with firearms 39.5604 [7th of 32]
Gun violence > Homicides > Overall homicide rate > per 100,000 pop. 9.1 [14th of 32]
Jails 1,558 [5th of 80]
Murders committed by youths 8,226 [3rd of 73]
Murders with firearms 9,369 [1st of 36]
Perception of safety > Walking in dark 82% [2nd of 15]
Prisoners 2,019,234 prisoners [1st of 168]
Prisoners > Per capita 715 per 100,000 people [1st of 164]
Rape victims 0.4% [13th of 20]
Software piracy rate 20% [107th of 107]
Suicide rates in ages 15-24 13.7 per 100,000 people [7th of 17]
Suicide rates in ages 25-34 15.3 per 100,000 people [10th of 17]
Total crime victims 21.1% [15th of 20]
Total crimes 11,877,218 [1st of 50]