17 July 2010
Goldman Sachs Settlement
They announced as much after the close of business on the stock exchange Thursday (and, perhaps not incidentally, after the Senate had voted in favor of the big Dodd-Frank bill).
The deal looks like a clear win for Goldman's attorneys. It seems they persuaded the SEC guys there was no case there, so the best thing to do was to bow out with some grace. Here's the official announcement.
And here is Felix Salmon's take, with which I concur.
Salmon is gloomy about the fact that Goldman scored this win, because he has long bought the prosecution's argument. As a pragmatist and an anarcho-capitalist, though, I'm delighted with this turn of events.
Here's what Adam L. at Credit Slips, has to say. "The real value of the Abacus litigation was it was a chance to shine some sunlight on the inner workings of Wall Street. The complaint and hearings gave us a taste, but if this litigation went further, we would likely have learned much, much more."
I'm sorry, but the notion of holding a trial not because there is sufficient evidence the defendants actually did anything illegal, but because somebody wants to use the public spectacle to shed "sunlight," is itself repugnant. Devoid of sunlight. It is the kind of justification that could lead us to a very dark place.
Knowledge is warranted belief -- it is the body of belief that we build up because, while living in this world, we've developed good reasons for believing it. What we know, then, is what works -- and it is, necessarily, what has worked for us, each of us individually, as a first approximation. For my other blog, on the struggles for control in the corporate suites, see www.proxypartisans.blogspot.com.