Posts Tagged ‘shareholders’

Goldman Sachs Settlement with SEC Ignores Company’s Duty to Provide Timely Disclosures to Shareholders about Investigation Leading up to Litigation

Sam Antar makes a good point here.  Looking out for shareholders was not the objective of the lawsuit brought by the SEC against Goldman Sachs. Whether it would have, should have, or could have been considered is another matter, and apparently not going to be addressed.  What we have here (and seemingly everywhere within our financial system) is not a real operation of law, but more of a political sideshow.  - Ilene 

Goldman Sachs Settlement with SEC Ignores Company’s Duty to Provide Timely Disclosures to Shareholders about Investigation Leading up to Litigation

Courtesy of Sam Antar of White Collar Fraud 

The Securities and Exchange Commission’s settlement of a lawsuit against Goldman Sachs (NYSE: GS) over a certain subprime mortgage product sold to investors misses a key issue concerning the company’s duty to provide timely and transparent disclosures to its own shareholders about government subpoenas, investigations, and pending enforcement actions against the firm. In this particular case, Goldman did not make timely disclosures about the regulator’s investigation and pending lawsuit against the firm, right under the SEC investigator’s noses.

Goldman Sachs chooses to keep shareholders in the dark about SEC investigation and pending enforcement action

During the summer of 2008, the SEC started investigating Goldman’s marketing of a certain subprime mortgage product, known as ABACUS CDO, to investors who lost over $1 billion from that transaction.
At that time, Goldman Sachs knew that the SEC was investigating its failure to disclose material information to investors in violation of SEC Rule 10b-5 in connection with that transaction. However, Goldman Sachs did not disclose the SEC’s investigation in its financial reports.

In July 2009, the SEC sent Goldman Sachs a Wells notice informing Goldman of its intention to file a lawsuit against the company. Still, Goldman Sachs chose not to disclose the SEC’s pending enforcement action in its financial reports.

On Friday, April 16, 2010, the SEC filed a surprise lawsuit against Goldman Sachs and Executive Director Fabrice Tourre alleging securities fraud in connected with the company’s marketing of the ABACUS CDO to investors. That day, Goldman Sachs shares plummeted from $183.31 per share to $160.30 per share or about 13%, wiping out about $12 billion of shareholder wealth.

Clearly, investors deemed the surprise news of the SEC complaint against the company as material information, unlike the management team running Goldman Sachs.

Goldman Sachs settles SEC charges

Yesterday, Goldman Sachs settled SEC charges…
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Greed’s Not Good For Shareholders

Greed’s Not Good For Shareholders

greedCourtesy of Tim at The Psy-Fi Blog 

Don’t Aim to Maximise Shareholder Value

When we look at the genuinely successful business people of our time, that happy band of folks who’ve created true shareholder value, enriching themselves and their followers to an astonishing degree, we find an extraordinary thing. The vast majority of these people are not particularly interested in money and their companies are generally not dedicated to some New Age declaration of shareholder value maximisation.

Greed is not a quality that seems to drive the world’s greatest creators of shareholder value and creating shareholder value is not the aim of the companies that are best at it. In fact we can pretty much guarantee the alternative: wherever you find over-rewarded executives presiding over companies whose main aim is to increase their market capitalisation we should pick up our skirts and get the hell out of it. Corporate greed is bad for ordinary shareholders.

Buffett’s Army

If you read Warren Buffett’s shareholder letters, for instance, you can’t help but notice that the people whose companies he takes over all, by and large, continue to work for him despite being made rich beyond the dreams of our avarice. They tap-dance to the workplace everyday and lead their companies through a set of values far removed from the value enhancing conceits of management consultants.

What seems to set aside great business people and their businesses from the pond life that mainly occupies executive positions is that they focus on things other than making money. These generally involve doing stuff that people actually want to pay good cash for, rather than an obsession with growth. Indeed, the last thing we should want is running our companies is people who are greedy for money, since the opportunities for unscrupulous executives to cheat us shareholders are huge.

Welch on Shareholder Value

The dangers of the concept of shareholder value are outlined by Jacques Reland who quotes Jack Welch with approval:

“On the face of it Shareholder Value is the dumbest idea in the world. Shareholder Value is a result, not a strategy. Your main constituencies are your employees, your customers and your products”

Welch, of course, was the man behind the elevation of shareholder value to cult status in his time as CEO of General Electric, so this looks like…
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10 Things You Need To Know That Are Going On This Weekend

SPECIAL EDITION: 10 Things You Need To Know That Are Going On This Weekend

Courtesy of Joe Weisenthal, at Clusterstock 

It’s a Saturday, but it certainly doesn’t feel like it, because there’s a heck of a lot going on. 

Here’s what you need to be paying attention to this May Day.

  • Greece/IMF/EU talks continue. According to Greek government officials, some kind of announcement may be made today. The market is hoping to hear something that’s orders of magnitude stronger than any bailout announcement we’ve gotten so far, or otherwise the feeling will be that it can and will fall through again.
  • Of course, there are fresh violent, anti-austerity protests going on today in Athens. The fact that it’s May Day, a day for celebrating anti-capitalism only adds to the tension.
  • New reports suggest the criminal probe into Goldman Sachs is not just a perfunctory follow-on to the SEC charges, but rather a truly separate thing that’s wider than Abacus, and that started before the SEC’s investigation. HUGE.
  • With just five days before the election, UK’s The Guardian has endorsed the Liberal Democrats, the country’s biggest third party. Its leader, Nick Clegg, has surged thanks to a string of strong debate performances, Gordon Brown’s disastrous campaigning, and a lingering sense of unease with the conservatives.


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    ValueWalk

    Workhorse Blows Up; Buffett And Berkshire Get Busy

    By Jacob Wolinsky. Originally published at ValueWalk.

    Whitney Tilson’s email to investors discussing Workhorse Group Inc (NASDAQ:WKHS) blows up; Buffett and Berkshire get busy; the king of SPACs wants you to know he’s the next Warren Buffett.

    Q4 2020 hedge fund letters, conferences and more

    Workhorse Blows Up

    1) Another day, another blowup of one of the stocks I've warned my readers about...

    On Monday, it was software supplier Ebix (EBIX). Yesterday, it was electric-vehicle developer Workhorse (WKHS), which tumbled 47% and was down ...



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    Kimble Charting Solutions

    Is Rising Inflation About To Hit U.S. Economy In Big Way?

    Courtesy of Chris Kimble

    Inflation seems to be a thing of the past… but current trading in bond and commodity markets tell us that it could become a thing of the future!

    Inflation hasn’t been an issue, or even on our radar, since the 1980s. Sure, the 2007 surge in oil prices offered some concern but the financial crisis killed any thoughts of inflation.

    So what’s got us concerned about inflation in 2021?

    Today we take a look at long-term charts of two potential inflation indicators: Crude Oil ...



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    Phil's Favorites

    Within a Matter of Months, the Fed's Balance Sheet Will Hit $8 Trillion; These Charts Tell the Rest of the Story

    Courtesy of Pam Martens

    By Pam Martens and Russ Martens: February 24, 2021 ~

    Every Thursday, at approximately 4:30 p.m., the Federal Reserve provides a report on its balance sheet as of the prior day. It’s known as the H.4.1 report or the Wednesday Level report.

    On Thursday, September 4, 2008, the ...



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    Zero Hedge

    Square Adds $170 Million In Bitcoin To Enable "Economic Empowerment"

    Courtesy of ZeroHedge

    Building on the list of recent companies to add crypto to their reserves, or embrace as a payments solution, Jack Dorsey's other company - Square - reportedly added $170 million of bitcoin to its existing $50 million reserves.

    Full Square Statement:

    Square also announced today that it has purchased approximately 3,318 bitcoins at an aggregate purchase price of $170 million.

    Combined with Square’s previous purchase of $50 million in bitcoin, this represents approximately five percent of Square’s ...



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    Digital Currencies

    What Is Top Shot?

     

    What Is Top Shot?

    Courtesy of 

    What I’m about to write is going to sound incredibly stupid. Some of it also might not be factually accurate, as I’m still very much a NoobWhale.  If you want to learn more, I suggest you start herehere, or ...



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    Biotech/COVID-19

    6 important truths about COVID-19 vaccines

     

    6 important truths about COVID-19 vaccines

    For many, distinguishing between fact and fiction is difficult. Olemedia/E+ via Getty Images

    Courtesy of Sarah Lynch, Binghamton University, State University of New York and Kanneboyina Nagaraju, Binghamton University, State University of New York

    One of the biggest barriers s...



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    Chart School

    Silver Review

    Courtesy of Read the Ticker

    We used to say billions, now its trillions of money printing, and investors are hunting for a way to defend their purchasing power, silver is one way to do so.


    Lets review silver with Elliot wave, Wyckoff, Cycles and Fractals.


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    Changes in the world is the source of all market moves, to catch and ride the change we believe a combination of ...

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    Politics

    Why the British abandoned impeachment - and what the US Congress might do next

     

    Why the British abandoned impeachment – and what the US Congress might do next

    The impeachment trial of Warren Hastings in 1788. Library of Congress

    Courtesy of Eliga Gould, University of New Hampshire

    Impeachment was developed in medieval England as a way to discipline the king’s ministers and other high officials. The framers of the U.S. Constitution took that idea and applied it to presidents, judges and other federal leaders.

    Now that tool is in use, and in question, during ...



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    Mapping The Market

    The Countries With The Most COVID-19 Cases

     

    The Countries With The Most COVID-19 Cases

    By Martin Armstrong, Statista, Jan 12, 2021

    This regularly updated infographic keeps track of the countries with the most confirmed Covid-19 cases. The United States is still at the top of the list, with a total now exceeding the 22 million mark, according to Johns Hopkins University figures. The total global figure is now over 85 million, while there have been more than 1.9 million deaths.

    You will find more infographics at ...



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    The Technical Traders

    Adaptive Fibonacci Price Modeling System Suggests Market Peak May Be Near

    Courtesy of Technical Traders

    Our Adaptive Fibonacci Price Modeling system is suggesting a moderate price peak may be already setting up in the NASDAQ while the Dow Jones, S&P500, and Transportation Index continue to rally beyond the projected Fibonacci Price Expansion Levels.  This indicates that capital may be shifting away from the already lofty Technology sector and into Basic Materials, Financials, Energy, Consumer Staples, Utilities, as well as other sectors.

    This type of a structural market shift indicates a move away from speculation and towards Blue Chip returns. It suggests traders and investors are expecting the US consumer to come back strong (or at least hold up the market at...



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    Lee's Free Thinking

    Texas, Florida, Arizona, Georgia - The Branch COVIDIANS Are Still Burning Down the House

     

    Texas, Florida, Arizona, Georgia – The Branch COVIDIANS Are Still Burning Down the House

    Courtesy of Lee Adler, WallStreetExaminer 

    The numbers of new cases in some of the hardest hit COVID19 states have started to plateau, or even decline, over the past few days. A few pundits have noted it and concluded that it was a hopeful sign. 

    Is it real or is something else going on? Like a restriction in the numbers of tests, or simply the inability to test enough, or are some people simply giving up on getting tested? Because as we all know from our dear leader, the less testing, the less...



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    Insider Scoop

    Economic Data Scheduled For Friday

    Courtesy of Benzinga

    • Data on nonfarm payrolls and unemployment rate for March will be released at 8:30 a.m. ET.
    • US Services Purchasing Managers' Index for March is scheduled for release at 9:45 a.m. ET.
    • The ISM's non-manufacturing index for March will be released at 10:00 a.m. ET.
    • The Baker Hughes North American rig count report for the latest week is scheduled for release at 1:00 p.m. ET.
    ...

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    Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...

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