Goldman Targeted by Investor Complaints of Naked Short-Selling

[DogPoundPup]

Source: Bloomberg

Nov. 17 (Bloomberg) -- Investors in the $591 billion high- yield, high-risk loan market are accusing Goldman Sachs Group Inc. of naked short selling to profit from record price declines.

At least two fund managers complained verbally to officials of the Loan Syndications and Trading Association, saying they believe Goldman helped drive down prices by using the technique, according to people with knowledge of the objections. New York- based Goldman is acting against its clients by trying to profit at their expense, the investors said.

A $171 billion drop in the value of the loans in the past year is pitting banks against investing clients on assets once considered so safe they typically traded at par. The drop exposed flaws in an unregulated market where trades can take from several days to months to settle and banks may have information unavailable to investors. In a naked-short transaction, a firm would sell debt it didn’t already own, betting the price will fall before it purchases the loan and delivers it to the buyer.

“The LSTA is closely monitoring issues of naked short selling,” Alicia Sansone, head of communications, marketing and education at the New York-based industry association, said in an e-mail.

Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=as3PwfEfBlhk&

[Waiting For Everyman]

1. K&R About time!

Jeez, it takes long to get to the obvious, doesn't it? There were complaints about this last summer which were shoved aside. Any casual observer could see then, that something was wrong with the market.

[Best_man23]

2. This law has been on the books since the 30s

Hasn't been enforced since Christopher Cox took over the SEC, and things have become worse since they repealed the uptick rule.

IMO, these two factors contribute greatly to the high level of volatility we're seeing in the markets.

[xiamiam]

6. they destroyed the housing market and the stock market...together with Deutsch Bank.. tcriminal

and we should have access to how much more money these guys have than the us and most small countries..it is a disgrace..

[acmavm]

3. Didn't someone here once post that this is what Sptizer was

working on before he let his pecker do his thinking for him?

[xiamiam]

8. they took him down so they could continue with their dirty tricks..imo..nt

[pattmarty]

4. It's time for jail time with Willie, Juan, and Jethro each taking.......

.......turns on their lily white asses.

[formercia]

5. They will pay their fine with the money Paulson gave them.

These people are out of control.

[dixiegrrrrl]

7. I understand about the financial rip-off part.

But the nudity???????????


Jeezz...those wild and crazy Paulson guys.