This is kinda a huge deal... Peter Fisher, managing director of BlackRock (yes, that BlackRock), states in a Bloomberg interview that Goldman's first quarter trading profit is non-recurring in nature, and believes it was mostly due to AIG unwinds...It read different in the feedreader-I'm guessing because of #1:
When Viniar was asked about whether profits came from the AIG unwind he said:
“I would never tell you that we didn’t book any profit, I
don’t even know,” he said. “I couldn’t tell you with any
counterparty that we booked zero, but I could tell you it
rounded to zero.”
The problem with this is that - I think - that what he is doing is at least misleading, if not dishonest.
I believe that even though we know that GS was the largest recipient of TARP funds via AIG (+/-$10bn I believe), I think what Viniar is saying is that this money was not a "profit". But their nnumbers would have looked very different had they not booked these revenues in the quarter. He did NOT say there were no revenues from the wind downs, he said no profits - and I believe after reading & listening to his comments that he made this distinction without ever clarifying the line he was drawing.- ..........................................................................................................................................................
- We caught some flak from a few readers when we posted "David Viniar, CFO of Goldman Sachs Blows Smoke at Journalists on AIG" on March 20. I think I'll stand by this closing paragraph:
...The authors go on to describe the problems involved in computing numbers on the cosmological scales required for 25 standard deviations. A good read, both for the statistically challenged and for pros like Viniar, a very highly paid PR guy, in addition to his CFO duties.
Just listened to it. He said "some of those profits" may have come from the AIG unwinds, which almost certainly must be true. He did not say he thinks "ALL" of them came from AIG unwinds.