16 June 2015

Santayana, Deja Vu

Goldman Sachs is at it again. Having bled the housing market, and the rest of the economy, to a near death experience and itself out of lucrative business decides to "innovate" yet again.
"Everything Goldman has done in the last 30 to 40 years has all been focused on the commercial side, or things that abut it very closely," said Chris Kotowski, a bank analyst with Oppenheimer & Company. "I refuse to believe that hiring a couple of programmers and offering to make $15,000 loans online is a highly value-added banking strategy."
[my emphasis]

And, it gets better:
The initial financing for the loans would come from certificates of deposit, which Goldman has been amassing in recent years. As the business grows, the bank may securitize the loans -- bundle them and sell them to investors -- to reduce some of the risk that it holds on its own books.

Is that a tornado klaxon I hear?

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