American Proscenium

Goldman Sachs and the Price of Beer

“I do believe that big money does organize itself somewhat like feral hogs.  If they detect a weakness or a bad scent, they’ll go after it,” said Richard Fisher, president of the Dallas Federal Reserve, on June 24.  Shortly thereafter, we started finding that our banks were engaged in all kinds of nonbank business—aluminum, electricity, oil, pipelines.  The public thinks banks are prohibited from engaging in ordinary commerce, but that is no longer true.  The public thinks that the banks’ business is to take deposits and make loans, but that is no longer true, either.  The big banks, unbeknownst to the rest of us, have transformed themselves into powerful global commodity and electricity traders.  Moreover, the banks are misbehaving in all those nonbanking businesses they are not supposed to be in.  The Department of Justice told the banks they were Too Big to Jail—that is, immune from criminal prosecution—and what kind of behavior would you expect to follow?  If you guessed “bad,” you’re right: The banks are now engaged in a scheme to place a tax on every transaction in the world.

Goldman Sachs, for example, has added one tenth of a cent to the cost of every can of beer or Coke.  Goldman Sachs describes its business as

production, storage, transporting, marketing...

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