July 17, 2010
Forget the tough talk from Robert Khuzami, head of the Securities and Exchange Commission. Friday’s initial $7 rise in Goldman Sachs’ share price speaks volumes.
While Mr Khuzami may have talked about Goldman paying a “heavy price” and the record fine being a “stark lesson” for Wall Street firms ‚Äď traders delivered a very different verdict.
The stock market, at least, believes that Goldman has struck an amazing deal with the US regulator, which had accused it of defrauding investors about the make-up of a package of sub-prime mortgage-backed securities.
Goldman’s rising share price has added more than $1bn to the market value of the bank since details of the settlement first leaked. Not a bad return on a $500m fine (even if the shares are still a long way off the highs seen before the SEC allegations).
This article was posted: Saturday, July 17, 2010 at 2:19 am