WASHINGTON " "In 2006 and 2007, Goldman Sachs Group peddled more than $40 billion in securities backed by at least 200,000 risky home mortgages, but never told the buyers it was secretly betting that a sharp drop in U.S. housing prices would send the value of those securities plummeting.
"Goldman's sales and its clandestine wagers, completed at the brink of the housing market meltdown, enabled the nation's premier investment bank to pass most of its potential losses to others before a flood of mortgage defaults staggered the U.S. and global economies.
"Only later did investors discover that what Goldman had promoted as triple-A rated investments were closer to junk.
"Now, pension funds, insurance companies, labor unions and foreign financial institutions that bought those dicey mortgage securities are facing large losses, and a five-month McClatchy investigation has found that Goldman's failure to disclose that it made secret, exotic bets on an imminent housing crash may have violated securities laws."
http://www.mcclatchydc.com/227/story/77791.html
Excerpt from Paul Craig Roberts' recent article, "The US is a Failed State
"Evidence that the US is a failed state is piling up faster than one can record it.
One conclusive hallmark of a failed state is that the crooks are inside the government -- using government to protect and to advance their private interests. And this is leading to ever increasing income inequality as the insiders manipulate economic policy for their enrichment, at the expense of everyone else.
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