It appears that even after thoroughly dominating the US legislative, judicial and executive branches, the long tentacles of the squid have been no better than the Mongolian hordes at overcoming the Chinese Wall (which is ironic seeking how easy it is to ignore the same construct internally between the firm's prop and flow traders...and yes, we will be posting our response to Goldman shortly, we have not forgotten). In the meantime, half a world away, a small Chinese power generator, Shenzhen Nanshan Power, is blatantly refusing to honor contracts with Goldman Subsidiary J. Aron for $80 million in derivative losses, and it appears that China itself has decided to stand behind the small company.
Reuters reports:
Shenzhen Nanshan Power (000037.SZ) (200037.SZ) said in a statement that it received several notices from J. Aron & Company, a trading subsidiary of Goldman Sachs (GS.N), for at least $79.96 million as compensation for terminating oil option contracts.
"We will not accept the demand by J. Aron for all the losses and related interests," said Nanshan, in line with the stance it took last December.
"We will try our best to negotiate with J. Aron and resolve the dispute peacefully...but the possibility of using a lawsuit can not be ruled out when talks fail," it added.
"J. Aron told us in one notice that if we do not pay the money, they will reserve the right to launch a lawsuit and will not send us any further notice."
The State Assets Supervision and Administration Commission said in September that it would back state-owned companies in any legal action against the foreign banks that sold them oil derivatives, which resulted in losses when oil prices dived late last year. [ID:nPEK14474]
A Beijing-based Goldman Sachs corporate communication official declined to comment.
Not sure what Hank Paulson's former firm would comment: alas the Chinese communist party still has to be filled with Goldman alumni. That being said, this is precisely the track that Goldman has been focusing on for the past few years. At this point, the firm realizes all too well that dominating power politics in China in the near futures is far more critical than complete control over D.C., as there is little the world's most important company can do domestically in the context of taxpayer capital transfer without a full fledged revolution.
h/t Sean
Perhaps Goldman simply countered this loss by purchasing loads of Fannie and Freedie during the week of December 21 right before Congress gave the blank Xmas check to Fannie and Freddie?
God sees all you know.
If you don't honor your gambling losses, people won't gamble with you anymore.
In a legitimate casino or game, of course. But if GS is selling, you are in a three card monte street game that is wholly rigged. You have the right to walk if the other guy is a thief and is trying to pick your pocket. The Chinese already figured that out, and announced that in September. GS just figures it will push until it meets resistance, then give up in a huff. Of course, only after the Federal Reserve and/or Treasury reimburses GS for its loss.
+100
'"then give up in a huff. Of course, only after the Federal Reserve and/or Treasury reimburses GS for its loss."
Exactly.
Forget making them whole. Borg de borg de borg them like a swedish chef.
bugs, whom are you fuggin kiddin? Golbitch busted at the table a long time ago and the house shook down the ladies at the slot machines and made up some chits on the fly so Golbitch could stay at the table til they tilted the shoe their way. About the dummest comment ever.
Its blissfully satisfying to see this story. Goldman is so entrenched here that in the example you provide, were Goldman the gambler and the US taxpayer the bookie, the gambler can stick the bookie with mountains of losses and the bookie will keep fronting money.
However China is too big and important for Goldman to do anything but whatever the Chinese demand. So the shoe is on the other foot there. China can stiff Goldman to the moon, lay on extra taxes, demand virgin sacrifices, and whatnot. Goldman will comply because they HAVE to be in China.
It just shows how far down we've slipped. The good ol US of A invented "no...fuck YOU" in all its forms, but it seems this is yet another thing we started and the Chinese now do better.
If a contract is based on fraud it is not enforceable. Just wondering when this would enter into the arena of a crime? Anyone?
Let's remember that GoldmanSachs is a hedge fund.
It just shows how far down we've slipped.
Yep, it's a day or two early, but years from now, we might pick New Year's 2010 as the date that China surpassed the US as the most powerful country in the world.
"If you don't honor your gambling losses, people won't gamble with you anymore."
Really? What if somebody else guaranteed they'd make you whole on any unpaid losses?
answer this question bugs. who is holding the cards on this deal? the squid or the Chicoms? What are they going to do to the Chinese? What exactly? Threaten to not sell them some more high risk triple A MBS bonds with high yields? Ha ha .
In which case the world would be a greatly better place.
UK citizen execution in China today should send a strong message to the rest of the world..just saying...
http://www.rttnews.com/ArticleView.aspx?Id=1167524&SMap=1
Try getting caught smuggling nine pounds of Herion into any Asia country & see how you end up. Execution might be a blessing
the message is that the UK is finished, they are a completely insignificant little country, with a glorious imperial past. China dont give a shit.
+555... same true to US of A... China don't give a shit. FREE TIBET! MOTHER FUUUCKERS!
Perhaps they're just getting a little payback for the two opium wars brought on by the brits.
People who use drugs to control deserve NO leniancy whatsoever. There is no defense. Doesn't matter if your crazy, stupid, regretful anything. You get caught smuggling highly addictive drugs you should be put to sleep.
who's gonna come down on the cia afghan heroin operation?
Lordy lordy. What aint addictive these days? Gambling (stocks), oil, free money, fast food, faster women, fastest vid-games, commenting on blogs?
The guy was executed because he could be. Others are too big to fail.
Oh, come on. Do you actually believe the British request for "clemency" was anything more than just for publicity? Do you really think the British government gives a crap about a single drug-dealing citizen by the name of Akmal Shaikh whose only defense was that he was mentally ill? I would even think that China would like this execution to be as public as possible.
Yep. I think we learned that in 1956.
yes its true. The Rothschilds used the Brits until they didn't need them anymore and then the sun did set on the British empire. After them, they used the United States. Now it is coming time for them to blow us off. So it is happening. Perhaps the next play area will be China. So it goes.
Because of 4k grams of smack? What happens if you are caught chewing gum on line...............
Oh yes, agreed, UK done
No bro, 4,030 grams of heroin - 8.9 pounds
What I said, 4 k grams (as in 4,000) of smack.
The rest of us need to party you know. And putting someone to death for drug smuggling is pretty stone age.
How many people will 8 pounds of heroin kill? Selling that to kids is pretty stone age.
I think the Chinese prosecutor said it was enough to kill over 50K people
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