"Knowledge will forever govern ignorance

 and a people who mean to be their own governors

 must arm themselves with the power which knowledge gives."

Saturday, March 12, 2005

Jon Corzine’s Atrocities

We received this post in an email today and thought it was worth sharing with our readers. The writer has certainly done his home work when it comes to Jon Corzine and the negative impact his actions had on U.S. businesses and our economy as an executive with Goldman Sachs. Mr. Corzine stands right at the Center of the ENRON scandal and the Wall Street practices that led to the NASDAQ meltdown at the beginning of this decade.

It has been clear to us from the beginning that Senator Corzine’s priorities are self-aggrandizement, not helping the “little guy”. He uses people as a means to his end –power. We believed the Democrats were making a big mistake when they rushed to endorse Corzine for Governor, his money clouding their judgment. The ENRON debacle, the burst of the high-tech bubble, “laddering”, and other dubious schemes practiced by Goldman Sachs had not fully come to light when Jon Corzine ran for the Senate in 2000.

Today we know the full story. We know the big winner was Jon Corzine and the losers were the “working stiffs” he so passionately pretends to speak for today. Can Senator Corzine’s money divert the voter’s attention from his record, it remains to be seen.

Normally I don’t e-mail much of anything, but as I am getting so disgusted with both parties, probably more with the Dems at this point lets talk about our potential next governor Jon Corzine and his relationship to Goldman Sachs:

“Once upon a time,” (this story does not have a happy ending)…..Goldman Sachs & Co. was hyping Enron stocks past $90. No investment bank on Wall Street “earned” more underwriting fees from Enron since 1986 than Goldman Sachs. And, no other investment bank was more bullish on Enron for a longer period of time than Goldman Sachs.

In 1993, Goldman Sachs “invented” a security that offered Enron Corp. and other companies an irresistible combination. It was designed in such a way that it could be called debt or equity, as needed. For the accountant, it resembled a loan, so that interest payments could be deducted from taxable income. For shareholders and rating agencies, who look askance at overleveraged companies, it resembled equity.

To top officials at the Clinton Treasury Department, the so-called Monthly Income Preferred Shares, or MIPS, looked like a charade - a way for companies to mask the size of their debt while cutting their federal tax bill. And guess who was CEO at the time? When Treasury resisted, a letter, signed by Jon Corzine, then chief executive officer of Goldman Sachs, portrayed the Treasury as attempting to draw “completely arbitrary” lines between debt and equity. Of course, MIPS would make failing companies look better on the books and Goldman Sachs more money. Eventually, the federal government acquiesced to the arrangement.

I wonder if Mr. Corzine ever thought to apologize to all the workers at ENRON who lost their jobs and their retirement savings when the company went under. The lobbying efforts of Mr. Corzine enabled ENRON to hide its debt while its corporate officers lined their own pockets as the corporation went bankrupt- of course, without the knowledge of ENRON workers who were fraudulently induced…or required to purchase…or intimidated…to hold on to worthless stock by the selfsame corporate officers. And they blame Bush for ENRON….that’s funny as funny can be…..if anyone can be considered the “architect” of ENRON, it is Mr. Corzine. Not that I don’t have my own problems with the President, but let’s give credit where credit is due.

Thus, ENRON employees and outside investors were left with nothing while Corzine reaped a windfall of hundreds of millions of dollars when he left Goldman Sachs. Blood money from blue and white collar workers, many of whom too old to be able to restart their careers and attain the same wages and retirement security they once had. If you are a working man in New Jersey and expect some help from this guy, you can forget it. You might as well live in Sudan, where it is alleged Goldman Sachs helped prop up the institution of slavery by its activities there. Now that’s what I call guaranteed permanent employment and job security for employees. ‘Way to go, Mr. C.! Must be some sort of a nostalgia issue with the black vote you get I guess.

Goldman Sachs was a target of class-action lawsuits and accusations by a former broker who complained to the Securities and Exchange Commission that the investment house engaged in a scheme to force unwitting investors to pay artificially high prices for certain stocks. Corzine said he knew nothing about such schemes when he ran the firm from 1994 to 1999. “I don’t believe there is ever going to be anything that sticks about us at Goldman Sachs forcing anybody to buy anything,” Corzine said in an interview. “Goldman Sachs never forced anyone to buy anything when I was chairman, I can tell you that.”

But Nicholas Maier, who was syndicate manager of the Wall Street firm Cramer & Co. from 1996 to 1998, told SEC investigators that Goldman Sachs routinely forced him to buy stocks at inflated prices if he wanted to purchase shares of an initial public offering (IPO). “Goldman, from what I witnessed, they were the worst perpetrator,” Maier said. “They totally fueled the [market] bubble. And it’s specifically that kind of behavior that has caused the market crash. They built these stocks upon an illegal foundation - manipulated up, and ultimately, it really was the small person who ended up buying in.”

For example, Maier told the SEC that Goldman Sachs would offer him shares of a new company’s IPO at the initial, low price of $20 per share only if he agreed to purchase “aftermarket” shares of the same company at $100 each. In turn, he would sell the shares of the higher-priced stock to small investors. “None of these aftermarket orders had anything to do with what I honestly valued a company to be worth,” Maier said. “Goldman created the convincing appearance of a winner, and the trick worked so well that they seduced further interest from other speculators hoping to participate in the gold rush. The general public had no idea that these stocks were actually brought into the world at unnaturally high levels through illegal manipulation.”

Corzine retired from Goldman Sachs in 1999 after taking the firm public and receiving at least $320 million worth of its stock. He ran for the Senate in New Jersey in 2000, spending more than $60 million of his fortune to win the seat. The bubble of high-priced technology stocks began to burst in March 2000. In August 2000, the SEC issued a warning against aftermarket sales, also known as “laddering.” “I’ve never even heard the term ‘laddering’ before,” Corzine said.

However, Maier said it happened on Corzine’s watch. “For Corzine not to know of a common practice being utilized to generate and manipulate stock prices would be surprising,” Mr. Maier said. “He was obviously there during this time. I definitively saw his company engaged in illegal activity. They (the SEC) expressed to me that laddering is a trickier thing [to prove],” Maier said. “I will say it. They did it. They laddered. Whether the SEC can construct a case is a different story.”

A class-action lawsuit filed in April 2001 accused Goldman Sachs and others of engaging in “laddering” on the initial sale of stock of NetZero, driving up the company’s share price to artificially high levels. In another class-action suit, shareholders of Buy.com accused the firm and its underwriters, including Goldman Sachs, of engaging in a laddering scheme in its IPO in February 2000, after Corzine left Goldman. And investors of defunct online grocer Webvan.com filed a similar suit in federal court concerning that firm's initial public offering in November 1999. Another class-action suit filed said that underwriters, including Goldman Sachs, manipulated several IPOs since 1997, including at least six when Corzine was still at the helm of Goldman.

EToys sued Goldman Sachs for mishandling its 1999 initial public offering. The suit, filed in New York State Supreme Court, alleged that Goldman, one of the leading underwriters of IPOs, intentionally underpriced eToys’ offering and received kickbacks from its customers who profited when the shares soared. Goldman priced eToys’ IPO at $20 a share, and the shares closed at $76.56 in their Nasdaq debut on May 20, 1999, after hitting an intraday high of $85. Subsequently, shares of eToys traded on the Pink Sheets- akin to a minor league exchange for companies booted off the NASDAQ or New York Stock Exchange- at less than a penny a share.

There are many other examples of Goldman Sachs atrocities that can be found just by surfing on the internet, but it would be redundant at this point to recite them, except to point out that clearly, Corzine was a great fit for the organization. How many investors has he sold down the tube, how many lives of normal, hard-working people has he destroyed? And this is the person the Democrats want to be the next governor. God help us. God help the working man in New Jersey. So much for an honest days work where you can support your family and help your community without fleecing and hurting others.

I used to suggest that the politicians in this state were immoral, but at this point I think I would be wrong. They are basically amoral, i.e., individuals like Corzine, McGreevey & Codey, simply do not seem to have any understanding as to what constitutes right or wrong in the human sense of the term. Regardless of what they say in public, they don’t. With their ghetto mentality, they take what they want and do what they want without any hesitation, whether it’s raising taxes or engaging in or promoting legal corruption. They don’t care who they hurt by their actions. They don’t care that us working stiffs can’t meet our bills. It’s like explaining what a color looks like to blind man. They just don’t know any better and, like a developmentally disabled child, it’s impossible to explain it to them. And most of them, unfortunately, are morally developmentally disabled.

Maybe one of the two Republicans might be a somewhat better choice at this point. I don’t see how they could be much worse. As to the Democrats, I wish they would find someone else. But what do I know, if this was the middle ages, I would probably be the village idiot- gazing down at my navel and playing with my toes in the village square.


At 11:31 AM, Anonymous Anonymous said...

The "cooking" of ethics and truth in that filthy stew of state and local government we lovingly call New Jersey reminds me of the late Rodney Dangerfield's joke: "My wife's cooking is so bad I can't leave dental floss in the kitchen because the cockroaches hang themselves." ....We unfortunately, are the cockroaches......

At 3:01 PM, Anonymous Anonymous said...

Forget the Giants, let Messrs. To help with the budget deficit, let Corzine and Cody float a bond for "James E. McGreevey Bi-Partisan Memorial Pay Toilet Rest Stops" along the Turnpike and Parkway to be used on a first come first served basis and, as a sentimental gesture, allow McGreevey the honor of drilling the first glory hole.

At 11:40 PM, Blogger Ken Adams said...

Mr. Anonymous stopped by my place, and left exactly the same comments. I guess that means we're getting noticed, now that the comment spam has started to arrive.

At 6:52 AM, Anonymous Anonymous said...


I got the same note. They guy is very specific about his charges, and I would like to make sure they are true before I point them out.

At 9:04 AM, Blogger Enlighten said...

The email we received and posted here seems to check out with all we could find on the web. We wouldn't post anything without checking for corroborating links.

Perhaps we should have included them with the post, but we'll put them here for now.





At 10:39 AM, Anonymous newjersian said...

newjersian; not only in laddering illegal so is naked short sales... check out sec site, the faulking truth cmkx, fuego entertainment, from there you'll find more. Is it too late to find corzine guilty of laddering? could the 7 percent be brought back down?

At 4:34 PM, Anonymous Anonymous said...

Wow - I am reading these old articles (its now March of 2009) and the magnitude of what has been done to private workers (like upsuspecting Enron employees) is now going to happen to State of NJ employees under Corzine. Our pension funds were shuttled into hedge funds in a manner that the court deemed "proprietary" when the two largest State unions tried to find out where they went. I have had my salary decrease in the past 3 years (yes, I don't get COLA's or increases) and now with the involuntary furloughs and the diversion of required State pension payments, the handwriting on the wall isn't talking - its screaming......the pension system can't be solvent, and the unions might as well close up their offices.

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