Protesters Taunt Goldman Sachs Employees By Singing "Frosty The Goldman" Outside Company Christmas Party

Last week a clutch of protesters sang parodic carols outside the Goldman Sachs Christmas party at the hoity-toity BLVD club to protest the companies involvement with subprime mortgages. The activists and homeowners are mad at Goldman for betting that the subprime market would tank, while still urging their clients to invest heavily in it. However, someone might want to tell the carolers that Goldman doesn’t issue residential mortgages. Oops. In any event, their song is pretty funny. Here are the lyrics to “Goldman, the Two-faced I-Bank” (sung to the tune of “Rudolph, the Red Nose Reindeer):

You know Merrill and Morgan and Lehman and Citi
J.P. and Wamu and Bofa and Barclay’s
But do you recall?
The most famous i-bank of all?

Goldman the two-faced i-bank

Gave out very shoddy loans
And if you ever saw them
You’d wonder how its profits rose

All of the other i-banks
Lost billions on the subprime game
How did that crooked Goldman
Come away with all the fame?

Because it knew how bad it was
And it stoked the flames
At the same time that it made bad loans
It bet that folks would lose their homes

Right now it’s bonus season
And we’re shouting “don’t you see!
Goldman the two-faced i-bank
Pay now or pay in history!”

Frosty the Goldman

Frosty the Goldman
Was a very crafty soul
With a gilded pipe and a lot of dough
And a heart made out of coal

Frosty the Goldman
Was too smart to lose they say
He made awful loans
But he sure did know
How to swindle us for pay

There must have been some magic
In that goldman pipe he smoked
For when he held it to his lips
He made bank and we went broke
Frosty the Goldman
Was as rich as rich can be
But still he’d say
“Make the poor folks pay!
And bring their homes right back to me”

Frosty the Goldman
Knew there had to be a way
To boost his funds
At the end of the run
On the backs of the subprime prey

He plundered and pillaged
Like a felon on the lam
Running here and there all around De Beers
Saying catch me if you can

He led us down the road to debt
And before the market dropped
He even bet we’d lose our homes
And now we holler STOP!

(thief!)

Frosty the Goldman
It is soon your bonus day
Stop telling us lies
We can rhyme “securitize”
And you sure as hell can pay

thumpety thump thump
thumpety thump thump
Look at Goldman go

thumpety thump thump
thumpety thump thump
Give up your dirty dough

“Frosty the Goldman” and Other Odes to Subprime Profiteers [Village Voice] (Thanks to James!)

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  1. superborty says:

    These people are pathetic. Goldman has done nothing wrong. Only idiots are the homebuyers who took out absurd mortgages they couldn’t afford and the mortgage bankers who tricked stupid/lazy people into signing on the dotted line.

  2. humphrmi says:

    That’s so funny. Totally ignore the mortgage brokers who bought & sold the loans, the other baners who securitized them, the ratings companies that rated them too high, and instead blame the one company that all along was saying “These financial instruments are too risky, written poorly, over-rated, and they’re going to tank.”

    Yeah, it’s chicken little’s fault that the sky fell.

  3. B says:

    Ummm, last week?

  4. gooser992 says:

    Actually, Goldman continued to urge its clients to invest in subprime loans while it was short selling them. At the very least, they violated their responsibilities to their clients.

  5. DrGirlfriend says:

    That’s a long song to memorize. Kudos. Less-committed protesters would have petered out halfway through.

  6. Douchebagus Maximus says:

    I wonder if any of them have Viking stoves and cocks that resemble “a baby’s arm”

    [cajunboyinthecity.blogspot.com]

  7. ftrain says:

    @gooser992: +1 for knowing what’s up. Most people don’t know that’s what Goldman did to their clients. Not illegal but highly suspicious Goldman researchers kept hyping CDOs to their clients while instructing their prop traders to short them.

  8. rjhiggins says:

    @superborty: So you think it’s OK for companies to mislead clients (not all of whom may be financial wizards) and lure them into loans that are likely to bankrupt them down the road. And, in Goldman’s case, to profit handsomely off it (even if they didn’t make the actual loans).

    Just wondering why you’re reading a consumer blog.

  9. B says:

    @rjhiggins: I missed the part where Goldman was misleading customers into getting residential loans, since, you know, they’re not a residential mortgage company. Their “crime” was profiting over the shady business practices of other companies.

  10. zibby says:

    Where the fuck do people get all this time?

  11. mikelotus says:

    love how the knee jerks lash out as usual on this site, or should i say the misguided conservatives? what goldman sachs has done awaits further investigation but there is no doubt that they were pushing these mortgage funds at the same time as they were running away from them. that is a fact. and though this has nothing directly to do with it, since it was brought up, we now know that many of the federal reserve board members raised with greenspan that unscrupulous lenders were operating at a high number in this market and greenspan chose to ignore it. now, way too late, the federal reserve is doing its job and addressing this. we have no idea how many people this impacts, but i bet its much higher than the blame the home buyers crowd would ever imagine.

  12. canerican says:

    “Where the fuck do people get all this time?”

    My thoughts, shouldn’t they be working to pay off their mortgages? But seriously, there are some people who can pull off the perpetual protest and make money doing it (Sheehan, Moore, and racists like David Duke, Rev. Jesse Jackson even make a decent living). But these people who go and protest on a weekly basis (there are some here in Buffalo, in front of recruiting centers, I see the same guys 2-3 times per week)… like, shouldn’t they get a job, or is government assistance enough, or do they have a rich Uncle?

    “misguided conservatives?”
    So is every Conservative misguided, or should the Liberal ideology dominate all conversation? It seriously annoys me, Conservatives who say Liberals are all wrong, Liberals who say Conservatism is all wrong. Isn’t that the point of debate to discuss a plurality of ideas? Isn’t that what makes freedom of speech even useful? Why bother with comments if every opposing view gets silenced as a “misguided conservative” remark? Should internet comments simply be a Liberal echo-chamber?

  13. rjhiggins says:

    @B: Read my post again (or maybe for the first time): I didn’t say it was Goldman that made the loans, only that it clearly knew it was going on and positioned itself to profit handsomely off it.

  14. eco2geek says:

    If the jargon economists use wasn’t hard enough to understand by us mere mortals, the jargon used by investment bankers is possibly even worse. “Securitization,” “selling short,” “CDOs,” “hedge positions” — it’s enough to make you shake your head and move on.

    But let me (a mere mortal) go out on a limb and try to explain what these protesters were harrassing Goldman Sachs about. Mortgage companies often don’t “keep” the mortgages they sell; they sell the contracts to other companies, who in turn wrap them up together and sell them as all sorts of complicated investments. Goldman Sachs seems to have understood what a mess the sub-prime mortgage scandal would turn into, and how much money would be lost in the end. And so their investment guys borrowed sub-prime mortgage bonds and sold them, all the while betting the price would go down (i.e. they’d turn into junk). Later on, when it did, Goldman Sachs bought the bonds back at lower prices, and thus, made a profit. In other words, they engaged in “short selling” and the risk paid off.

    Quoting Wikipedia, Goldman Sachs wrote in its Sept. ’07 Q3 report:

    “Net revenues in [trading] mortgages were … significantly higher, despite continued deterioration in the market environment. Significant losses on non-prime loans and securities were more than offset by gains on short mortgage positions.”

    Goldman Sachs also issued home-loan-backed bonds (no, it didn’t sell mortgages directly, but it did buy them from mortgage companies and package them up into investments). And so, as the Wikipedia article also notes,

    “Goldman earnt revenue by selling its products twice: first as an asset and then as a short.”

    (Anyone who knows more about this than I do, please correct any errors, which I take responsibility for.)

    The “Oops” here goes to The Consumerist for not doing an adequate job of explaining what the protesters were protesting.

  15. basket548 says:

    As someone who actually works at an investment bank, let me try to explain what is going on. Goldman, like all other I-banks, does not just buy and sell stocks for their clients; it can also use the firm’s own money to make bets for or against the market (called proprietary, or ‘prop’ trading). There was a small group of traders (~16 out of a mortgage program of 400+) that put a large amount of money against the subprime market. GS wasn’t incredibly happy about the move; in fact, management fought to LOWER the amount exposed to the subprime market.

    However, GS came up smelling like roses (as it almost always does) because of that small group. No one did anything illegal – the prop traders just it right, waaaay right.

  16. superborty says:

    @ Basket548: THanks for explaining to the people who don’t understand how investment banks operate. A lot of the negative comments come from people who must think the banks (in this case, Goldman), are a small coordinated team screwing one side and profiting on the other. Not sure how many employees Goldman has (85k??). If a client wants to buy something, Goldman will sell it. Doesn’t mean they were advocating the trading idea. They were simply facilitating the trade.

    And yes, I think people shouldn’t go out buying houses with money they don’t have. I didn’t. Stuck in a crappy apt. Makes me so much happier when the government then wants to bail these chumps out….

  17. mikelotus says:

    @canerican:
    read after last semicolon.
    Amendment 1 – Freedom of Religion, Press, Expression. Ratified 12/15/1791.
    Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

    @basket548:
    @superborty:
    From Ben Stein’s column in the New York Times, [www.nytimes.com]
    ” More thoughts came to me as I read a recent piece in Fortune by my colleague Allan Sloan, a veteran financial writer. Mr. Sloan traces the life and death throes of a Goldman Sachs-arranged collateralized mortgage obligation. He shows how truly toxic waste was sold to overly eager investors who now have major charge-offs, and he also points out that some parts of the C.M.O. were indeed safe and were either current or had been paid off.

    But what leaps out at me from this story is that Goldman Sachs was injecting dangerous financial products into the world’s commercial bloodstream for years.

    My pal, colleague and alter ego, the financial manager Phil DeMuth, culled data from a financial Web site, ABAlert.com (for “asset-backed alert”), that Goldman Sachs was one of the top 10 sellers of C.M.O.’s for the last two and a half years. From the evidence I see, Goldman was doing this for years. It might have sold very roughly $100 billion of the stuff in that period, according to ABAlert. Goldman was doing it on a scale of billions even when Henry M. Paulson Jr., the current Treasury secretary, led the firm.

    The Goldman spokesman would not comment on this except to note that other firms sold C.M.O.’s too.

    The point to bear in mind, as Mr. Sloan brilliantly makes clear, is that as Goldman was peddling C.M.O.’s, it was also shorting the junk on a titanic scale through index sales – showing, at least to me, how horrible a product it believed it was selling.”

    “To my old eyes, the recent unhappiness about mortgages and Goldman’s connection with them are not examples of sterling conduct. It is bad enough to have been selling this stuff. It is far worse when the sellers were, in effect, simultaneously shorting the stuff they were selling, or making similar bets.

    Doesn’t this bear some slight resemblance to Merrill selling tech stocks during the bubble while its analyst Henry Blodget was reportedly telling his friends what garbage they were? How different would it be from selling short the junky stock that your firm is underwriting? And if a top economist at Goldman Sachs was saying housing was in trouble, why did Goldman continue to underwrite junk mortgage issues into the market?

    HERE is a query, as we used to say in law school: Should Henry M. Paulson Jr., who formerly ran a firm that engaged in this kind of conduct, be serving as Treasury secretary? Should there not be some inquiry into what the invisible government of Goldman (and the rest of Wall Street) did to create this disaster, which has caught up with some Wall Street firms but not the nimble Goldman?

    When the Depression got under way, the government created the Temporary National Economic Committee to study just what had happened on the Street to get the tragedy going. Maybe it’s time for an investigation of just what Wall Street and Goldman did to make money as they pumped this mortgage mess into the economic system, and sometimes were seemingly on both sides of the deal.

    Or is Goldman Sachs like “Love Story”? Does working there mean never having to say you’re sorry?”

  18. eco2geek says:

    Oh, money is just money. It’s only when people start making value judgments about the way it’s made that you start drawing protesters.

    So I went and found someone else who also made money last year off the poor financial choices of others — my friendly local payday loan guy — and he said not to worry; what Goldman Sachs did was A-OK. Very clever, too.