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Posted Aug 10, 2009 11:27am EDT by Aaron Task


The New York Times provided more fuel for the Goldman Sachs conspiracy fires this weekend, detailing phone calls then Treasury Secretary and former Goldman CEO Hank Paulson made to current Goldman Sachs CEO Lloyd Blankfein last September.
At issue is whether Paulson gave his former firm favorable treatment, particularly as it pertained to the bailout of AIG whose counterparties were paid 100 cents on the dollar, including Goldman to the tune of nearly $13 billion.

A spokesman for Paulson tells The NYT that Goldman never received special treatment from the Treasury. Meanwhile, a Goldman spokesman says Blankfein was just one of several CEOs to be contacted by Treasury officials. "Given what was happening in the world, it would have been shocking if such conversations hadn't taken place," the spokesman tells The Times.

That may well be true, and Goldman's actions may be above reproach, but perception is reality and the appearance of impropriety is clear, says Scott Bleier, president of

"Whether everything is on the up and up or not, I can't say," Bleier concedes. "But if it looks a certain way, people are going to perceive it a certain way [and] the perception is it is bad."

Beyond the Paulson-Blankfein phone calls, Bleier takes umbrage with Abby Cohen, chairwoman of Goldman's investment policy committee, declaring "the new bull market has begun" last week, after a nearly 50% rally from the March lows.

More than just being late to the rally, Bleier says Cohen's timing is "shameful" because Goldman made over $100 million in trading revenue on 46 separate days in the second quarter, according to published reports.

"If they were making all this money over this quarter, where was the chief strategist 50%, 30%, 20% ago?," he asks.,FAS,FAZ,JPM