Monday, April 19, 2010

The Conglomerate Weighs in On Goldman Sachs (GS)

Today the stock closed up $2.62 at $163.62. After-hours it is up another $1.02.
Our first post on the Goldman Variations was "Goldman/SEC Kabuki (GS)":
With about 10 minutes to go it looks like GS will close around $161.
Figure an 8 P/E on the Billion alleged here and the stock makes back about half today's loss. Trader-think, on-the-fly.

Original post:
It's a nasty, nasty business but I don't think Goldman pays a price as big as the loss in market cap.
[I think he's saying 'Buy' -ed]...
...The stock was recently at $162.66 after trading as low as $155.55.
Sell the puts and use the proceeds to buy the calls.
That might have been a tad aggressive, not to mention the $7500 per contract you'd have to deposit and possibly invest should the stock get put to you. Nonetheless it was a correct instanalysis as far as direction and timing.

Here is some seriously in-depth thinking from The Conglomerate:
Goldman Sachs and the Grassy Knoll

Cash vs. Synthetic CDOs: Which team was Paulson on? (Plus the dangers of lawyers judging the level of fraud in a market)

Did Goldman deceive the collateral manager? Why it matters

The Goldman Case: Gambling and Who Selects the Cards in the Deck

Investigating Goldman: How you can hide a lemon in plain sight
Here's Keith Jarrett performing the Aria from Bach's Goldberg Variations: