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CalPers Joins Everyone Else Who Has Lost Money Or Stands For Reelection, In Reevaluating Goldman Relationship

Courtesy of Tyler Durden

Today’s Casablanca moment of the day is brought to you by CalPers. The latest entity to be shocked, SHOCKED, at just what Goldman’s standard operating procedure has been for many, many years is none other than the world’s largest pension fund, the California Public Employees’ Retirement System (and repeat Goldman client), which itself has been having quiet a few problems recently, and not just ethical ones, but more importantly performance related ones. The irony is that were Goldman to close tomorrow, the outcry from all these same hypocritical bandwagoneers would have been ten times louder. Telegraph reports:

CalPERS said it wants to look into the bank’s risk management and corporate governance systems.

The pension fund, which owns 1.8m shares in the investment bank worth approximately $291m (£190m), said it is “disturbed” by the charges, which the bank denies.
“We’re very disturbed about the SEC charges,” said Joe Dear, CalPERS’ chief investment officer. “We’ll follow that closely.”

Mr Dear noted that Goldman does not manage any money for the pension fund, adding that CalPERS’ staff will also look into shareholder communication

This is understood to be a key issue for many shareholders, given investors were not made aware of the investigation until Friday, as a result of the SEC’s announcement, even though the bank received a “Wells Notice” from the SEC – which notifies a firm of its intent to bring charges – in July 2009.

At this point it is a virtual certainty that anyone standing for reelection, or anyone who may have lost any money over the past 5 years will soon join the anti-Goldman brigade. If this was all an orchestrated pr stunt by Rahm, or an MBO attempt by Goldman’s execs, it may very quickly escalate out of control, as Lehman showed the world all too well that in modern banking the distance between solvency and insolvency is just one rumor away.

h/t David


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