article from taibblog

Goldman is building an impressive resume of sweepingly bullish predictions that later on, inretrospect, look more like signals to investors that they should run screaming in the opposite direction. A good example might be May of 2008, when Goldman boldly predicted that oil would go to $200 a barrel; oil would go on to peak at $147 less than two months later and crash to the floor soon after.

O'Neill himself famously coined the infamous "BRIC" term (Brazil, Russia, India and China), urging investors to throw their money at those emerging markets, arguing that those markets would eclipse the U.S. and Japan as the world's biggest economies by 2050. Mutual fund investors responded by pouring $70 billion into BRIC over the last decade, but that run looks over now, as $15 billion flowed out of BRIC funds in this past year alone, and some analysts are predicting a $20 percent drop this year.
Even Goldman wrote in a Dec. 7 report that that BRIC has already seen its crest. "We have likely seen the peak in potential growth for the BRICs as a group," Goldman analyst Dominic Wilson wrote in the Dec. 7 report.
I laughed when I read Wilson's quote, wondering exactly how long ago the bank privately came to that conclusion and started shorting BRIC countries. Goldman's Dec. 7 report, incidentally, arrived just before O'Neill released his new book, a Tom Friedmanesque volume of cheerleading nonsense called The Growth Map: Economic Opportunity in the BRICs and Beyond. That book was published on December 8, meaning O'Neill was seen spending 256 pages predicting "rosy prospects" for the BRIC bloc exactly one day after Goldman itself had officially bailed on its own cheesy marketing gimmick.
Anyway, every time I read one of these rah-rah predictions, I get this feeling that I've seen this movie before. When it comes time to do Goldman, Sachs: The Movie!, I'll be bummed beyond belief if Vin Diesel doesn't get to play Jim O'Neill.
The folks at Zero Hedge long ago caught on to Goldman's JT-Marlin pump-and-dump vibe. Here's what they said when Goldman upgraded European bank stocks a few weeks ago:

Happy New Year, everyone. Hope you all had a great holiday...
Have a column on Iowa coming soon, but first, a quick but absurd note from the world of high finance.
It seems Jim O'Neill, the head of Goldman's Asset Management department, is predicting that the United States stock market may go up "15 to 20 percent." O'Neill apparently believes Ben Bernanke and the Federal Reserve will resort to another round of money-printing, and finally green-light the long-awaited "Qe3," or third round of "Quantitative Easing."
The QE programs involve the Fed printing hundreds of billions of dollars and pumping them into the marketplace, where they ostensibly stimulate the economy (although recent experience tells us that the money mostly ends up being swallowed by the financial services industry – but that's another subject for another time). Anyway, Bernanke declined to go ahead with a third QE program in late 2011, but O'Neill apparently thinks we'll get it in 2012. From Bloomberg:

"If QE2 doesn’t work, then we’ll get QE3," said O’Neill, who was named chairman of the money manager in September after working as the co-head of global economics research and chief currency economist at New York-based Goldman Sachs Group Inc. since 1995. There’s a "good chance" the S&P 500 will rise 15 percent to 20 percent in the next 12 months, he said.

O'Neill added that he thought a 20 percent bump would be "relatively straightforward" for the U.S. S&P.

Read more: http://www.rollingstone.com/politics/blogs/taibblog/goldmans-latest-boiler-room-stock-america-20120102#ixzz1iTaNXnRi

Goldman has just started selling European bank stocks to its clients, whom it is telling to buy European bank stocks. Said otherwise, the Stolpering of clients gullible enough to do what Goldman says and not does, has recommenced. Our advice, as always, do what Goldman's flow desk is doing as it begins to unload inventory of bank stocks. Translation: run from European bank exposure.

Sure enough, Euro bank stocks plummeted a few days after that ZH post.
I don't know much about the stock market, but when the O'Neills of the world start telling me what a great investment opportunity the American stock market is, I start getting the urge to buy canned food ...

Read more: http://www.rollingstone.com/politics/blogs/taibblog/goldmans-latest-boiler-room-stock-america-20120102#ixzz1iTa7GAdP

Regulators and Government still afraid to step on the toes of the big banks

Is the government really stepping up to hold banks accountable? The PR campaign is underway.

It is clear that their has been little pressure on the banks to clean up their act over the past year.  The government has lost its teeth and is in dire need of new dentures.  The teeth of our government came in the form of laws, rules and regulations that were to be enforced diligently to protect the people.  The attorneys general for all states was also given power to enforce laws against fraud and conflict of interests.  The past several years we have seen a melding of government and financial industry.  There is no longer the separation between the two that allows for proper enforcement of law and regulation. 

It has little to do with either political party or which of those hold power in the congress.  It is about the state/government becoming accomplices to the financial industry and their unscrupulous power grab.  It sometimes looks like it is the government being dictated by the banking industry, which is true, but there are plenty of parties from both sides working to blur the separation lines between State and Bank.  Though it was never addressed in the Constitution one could make a case that it is equally as important as the separation of church and state. 

It could be argued that at this point in our history we are at an extremely critical point that has crossed well over the line that used to separate the government from the self interested financial institutions.  The line was blurred psychologically years prior to the recent investments of Tarp funds into the too big to fail banks.  The Tarp just laid it out on the table for all those who had any doubt that the big money players were ruling the country.  The statement that money rules the world would apply to the US government at this juncture. 

I was hesitant to think it was so clear until recently.  The Tarp was an eye opener that showed just how vulnerable our government was to the TBTF banks.  They held the country hostage while they had their hand out looking for aid to get them out of their own mess.  Our institution of Congress took a dive, never giving much a of fight, when the realized elections and recess were around the corner. 

The argument that the world financial system was going to collapse could be made on the side of Congress but it wasn't true.  There is no evidence that world would have caved in had we not bailed out the big banks.  The government could have just as easily paid the country parties with the Tarp and cleaned out the top managers of the banks to get to the bottom of this debacle. 

What have we gotten for our gracious gift of Tarp funds?  Banks that still using deceptive practices to try and stay afloat. 
2. Banks that still have the many of the people in charge of creating this wonder system at the helm.
3.  Banks still milking the treasury for help and using the cheap money at the discount window to create shadow profits, trying to convince the world they were on sound footing. 
oh yes and of course no problems that a few more billion of tax payer dollars could not easily solve.