April 27, 2010
Posted: 04:00 AM ET
DON'T MISS MICHAL MOORE ON LARRY KING LIVE TUESDAY AT 9PM ET! WHY HE CLAIMS GOLDMAN SACHS MUGGED AMERICA!
NEW YORK (CNNMoney.com) - Internal Goldman Sachs e-mails released on Capitol Hill Saturday show how the firm used bets on mortgage securities in a bid to profit as the housing market began to plummet several years ago.
A lawmaker set to grill company executives on Tuesday says the documents show that Goldman executives knew their bets would profit the firm.
But the firm said that all of the documents turned over to the panel reveal a different picture - that the firm lost $1.2 billion in residential mortgage-backed securities in 2007 and 2008.
"Of course we didn't dodge the mortgage mess," Goldman CEO Lloyd Blankfein told company executives in an e-mail dated Nov. 18, 2007 that was released by both the committee and Goldman. "We lost money, then made more than we lost because of shorts," or trading bets aimed at profiting when a bond drops in value.
But Blankfein added: "Also, it's not over, so who knows how it will turn out ultimately."
Four Goldman exhibits were released by Sen. Carl Levin, D-Mich., who chairs the Permanent Subcommittee on Investigation of the Senate Homeland Security Committee.
The e-mails, Levin said, "show that, in fact, Goldman made a lot of money by betting against the mortgage market" and contradict the firm's claim that it was merely buying and selling securities for clients.
The dispute previews an expected showdown on Tuesday when Blankfein and other Goldman executives appear before Levin's committee.
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