The Goldman Sachs Swaps Shop: An Examination of Synthetic Short Selling through Credit Default Swaps and Implications of Securities and Exchange Commission v. Goldman Sachs & Co., et al.

摘要: Publisher Summary Derivative instruments such as collateralized debt obligations (CDO) and credit default swaps (CDS) are widely believed to have caused the seizure of global markets from 2007 through mid-2009. This chapter summarizes various aspects CDO CDS explains how they contributed recent financial crisis. It particularly focuses on derivative transaction known ABACUS 2007-AC1 (ABACUS), created by Goldman Sachs & Co. (Goldman) in 2006 2007, an illustration demonstrate lack regulatory efforts market lawmakers regulators seeking reform way derivatives structured, bought, sold. The SEC initiated a civil securities fraud action against Tourre for allegedly making materially misleading statements omissions connection with purchase sale ABACUS. had structured controversial reference RMBS marketed variety institutional investors, industry qualified buyers or “QIBs.” Securities Exchange Commission (SEC) complaint alleges that Paulson, reportedly second-largest hedge fund world at time action, approached expressed its desire bearish exposure synthetic referencing subprime RMBS. Goldman's alleged misconduct served catalyst few politicians were willing risk public perception defending Wall Street after it appeared again run amok avarice. Appropriate measures credit, derivatives, equities all clearly warranted environmental disaster Gulf Mexico has stoked renewed support sweeping reforms increased appetite greater government regulation seething public's collective consciousness.