As BP fails repeatedly in desperate attempts to cap a massive oil leak offshore at 'Deep Water Horizon' in the Gulf of Mexico, suspicion grows over certain 'coincidences.'

Is there really evidence here to support claims of a sinister conspiracy? Financiers Goldman Sachs not only fortuitously dumped millions of its shares in the British oil company, but has strong financial links to the chemical clean up firm tackling the disaster. Moreover, the Wall Street giant's new chairman was boss of BP only three months before.

Sections of the blogosphere are running into overdrive at the stark fact that Goldman Sachs Management (US) sold 6,025,387 of its shares in the British oil giant, BP on March 31, 2010 just days before the rupture of a pipe extracting deep sea oil. Experts variously estimate the spill to be dumping the equivalent of 5,000- 25,000 barrels of oil a day into the Gulf gravely impacting wildlife.

The sell off represented 43.7 per cent of the total BP stocks owned by the Wall Street powerhouse, reaping $276,770,112. However, the sale accounted for just under 0.5 per cent of the firm’s total investments. BP shares have fallen 12 per cent since the disaster.

‘Lucky’ for Goldman Sachs

The Wall Street sell off was unprecedented and stood out from all other transactions at a time when BP shares were being bought rather than sold. This sell-off may represent the largest single liquidation of petroleum stocks in the history of modern markets.

mmm?

Goldman Sachs Group Inc. in danger of losing business with a key group of clients as a result of the fraud allegations it faces: governments in Europe and the U.S.

Politicians in the U.K. and Germany are starting to call on their governments to cut ties with Goldman, which has long been one of the top financial advisers to European policy makers.

U.K. Liberal Democrat leader Nick Clegg, riding high in opinion polls less than three weeks before national elections, said on Tuesday that Goldman "should now be suspended in its role as one of the advisers to the government until these allegations are properly looked into." His comments follow Prime Minister Gordon Brown's recent characterization of Goldman's alleged behavior as "morally bankrupt."

The SEC does not have to win their "case". What is happening is that it is now politically very attractive to punish Goldman by the simple measure of cutting them off.

Easy to do and will snowball. Imagine this conversation between the board and a CEO - "So Britain and Germany will not deal with GS because they cannot be trusted but YOU want to do our deal with them?????"

What would you do?

Finally Shame is the tool as it always is in a healthy society.

WHILE the Securities and Exchange Commission’s allegations that Goldman Sachs defrauded clients is certainly big news, the case also raises a far broader issue that goes to the heart of how Wall Street has strayed from its intended mission.

Wall Street’s purpose, you will recall, is to raise money for industry: to finance steel mills and technology companies and, yes, even mortgages. But the collateralized debt obligations involved in the Goldman trades, like billions of dollars of similar trades sponsored by most every Wall Street firm, raised nothing for nobody. In essence, they were simply a side bet — like those in a casino — that allowed speculators to increase society’s mortgage wager without financing a single house.

Gambling is legal in a few states. Most gamblers know that in the end, the House Wins. The House wins because it rigs that game so that they have to win. You can have a good day, week, month, year. But in the end the House will win.

Wall Street is Las Vegas on Steroids.

The big houses like Goldman sit in the centre of the "Flow" - they see things we can never see. They can shape the game.

And it has been a game since the 1980's The key has been capital. Prior to the 1980's, true investment banks had limited access to capital. They truly had to live on their wits. Goldman had a traditional partner structure that made the long term key and prudence essential. You only got paid out in your last 5 years from all the accumulated increase in value for the firm.

But when the status of investment banking changed and they were allowed to access outside capital, they could control the game. The temptation was too great not too.

So quickly it was the trading rooms - that had been the "barrow" boys that made the money by trading for their own account. Power shifted from the "Bankers" who used a lifetime of relationships and intelligence to do business to the people in the trading rooms who were street smart and who used the firm's capital to give them leverage.

The Bankers lost to the Brokers. The focus on the real economy shifted to the Casino.

I was in the business for 15 years - just as this transition took place and was both a broker and a banker. Regretfully I was a major proponent of the shift. Back then, I did not have the knowledge as to how this would play out. Who did?

This last week has given me some hope that the reality of what Wall Street has become is emerging into the public domain.

Time to shed even more light about the distortion and danger of the "Broker" Casino.

All power corrupts. Total power corrupts completely!