Why Goldman Will Settle—and Fire Blankfein
With mob calling for blood, prolonged fight would cost too much
By Kevin Spak,  Newser Staff
Posted Apr 19, 2010 10:31 AM CDT
Goldman Sachs Group, Inc. Chairman and Chief Executive Officer Lloyd Blankfein testifies on Capitol Hill, Jan. 13, 2010, before the Financial Crisis Inquiry Commission.   (AP Photo/Pablo Martinez Monsivais)

(Newser) – Say sayonara to Lloyd Blankfein, who will soon be ex-CEO of Goldman Sachs, predicts Henry Blodget of Business Insider. It's not that Blankfein knew about the shady hedge fund deal that's landed Goldman in trouble with the SEC, it's that “as the universal jubilation and chop-licking that greeted the Goldman fraud announcement illustrated, the world still wants blood. It wants Goldman to pay for all of Wall Street's sins.”

Goldman says it's going to fight these fraud charges tooth and nail, but it'll probably reconsider. If it doesn't make this go away the press will spend the years leading up to the trial associating “Goldman” with “fraud.” So they'll settle, oust Blankfein, and hire a new CEO as Goldman's new, less fraudulent face. “Only when the pound of flesh has been sacrificed will the public and regulatory blood-lust be satisfied.” And the wiser heads at Goldman know it, Blodget adds.

 

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