WSJ: Goldman Sachs gives preferred clients early tips, letting them buy early, then later tells everyone else, which allows those clients to sell at a profit.
Not only that, at first they tell the retail clients something totally different from what they tell preferred clients.
Putting the prop traders with the top accounts onto hot trading ideas (by implication, everyone knows GS intends to pile in, hence it is safe for the big accounts to throw their weight in) smells like organized ramp of a stock.
AKA pump and dump?
Is Goldman’s selective trading disclosure a legal way for preferred clients to front run the market?
Where is our government on this? The SEC ignored multiple warnings on Madoff and Allen Stanford. And now the government is doing nothing about the practices of Goldman Sachs, which clearly need to be investigated thoroughly. This is not just about the laxness of the Bush Administration anymore. Question for President Obama: Who controls the country, D.C. or the investment banks?