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I just don't understand why the fact that ACA and the longs are pathetic and should have known they were getting screwed materially influences the question of w
by jfager 16y ago
I just don't understand why the fact that ACA and the longs are pathetic and should have known they were getting screwed materially influences the question of whether or not Goldman committed fraud. If they did (and it seems pretty clear that's the case), they should get off because they're an alpha dog?
- byrneseyeview 16y agoIt's only fraud if it is fraudulent not to tell ACA that some no-name hedge fund is on the other side of their trade. The ACA guys got paid big bucks to research their investments, not to make guesses based on how scary their counterparties were. It would be like a professional baseball team whose entire model for winning was that they'd only play games against Little League teams, but they'd sue the other team if they turned out to be good.
- jfager 16y agoSo your claim is that it's not fraudulent that Goldman lied to ACA saying Paulson was going to end up long on Abacus, or that Goldman lied to the real longs that ACA was solely responsible for selecting the reference portfolio?