Don McNay
By Don McNay
Award winning financial columnist and structured settlement guru
My father was a professional gambler and used to carry a roll of money that he called “walking around” money.
Walking around money is what the SEC settled for in the Goldman Sachs case.
$550 million is walking around money to a company like Goldman Sachs. It is less than 5% of the $10 billion in bonuses it paid itself last year.
Maybe “walking around” money is an understatement.
The stock market understood that Goldman got the best of the deal. Goldman’s stock price surged 4.43% on rumors of a settlement. As the Huffington Post pointed out, the stock gain was probably enough to cover the $550 million fine.
Also, Goldman got a monkey off its back. It can go on without a lawsuit hanging over its head. If the SEC had taken the time to do a through and complete investigations, who knows what they would have found.
In its never ending ability to accommodate Wall Street, the SEC announced the settlement on the day when the rest of the world was focused on passage of the financial reform bill. Thus, whatever “embarrassment” Goldman might have suffered was mitigated by the settlement not being a top news story.
One of the first tricks they teach you in corporate public relations is to release bad news on a day when it will get buried.
Goldman is rich enough to hire the best public relations people.
And it looks like the best lawyers. There has to be some major high fives going on in the boardroom after getting such a sweet heart deal.
I am not sure what the SEC hoped to accomplish with a quick and inadequate settlement. It didn’t make those of us on Main Street feel any better about our “watchdog.”
It just gave more evidence that the SEC is safely in the arms of Wall Street.
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Don McNay is the author of two books, the most recent being “Son of a Son of a Gambler: Winners, Losers and What to Do When You Win The Lottery.” McNay also is an award-winning financial columnist and contributor to The Huffington Post, where this piece was first published. His web site is www.donmcnay.com . McNay earned master’s degrees from Vanderbilt and American College and was inducted into the Eastern Kentucky University Hall of Distinguished Alumni. He is a lifetime member of the Million Dollar Round Table and has four professional designations in the financial services field, CLU, ChFC, MSFS, and CSSC.
Posted July 18, 2010 at 12:00 pm, in From the News
