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is Goldman Sachs good investment to counter RE crash?

snigletsniglet
edited November 2007 in The Economy
Seeing as how Goldman Sachs says they are heavily shorting mortgage securities and CDOs, are they a good investment for anyone who thinks the real-estate market is headed for a substantial downturn? Or is Goldman liable to suffer losses anyway if a recession really takes hold? I know that Goldman was suffering losses in their hedge funds over the summer which indicates there could be future problems to some of their investment strategies.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aiU.E9eWHWXM&refer=home

Comments

  • SunTzuSunTzu
    IMO, GS is only good for shorting.

    It claims it doesn't have any losses from subprime which is balony. Bloomberg reported that GS has more Level 3 assets on its books than either Citi or Merrill. GS just wouldn't come clean because of its purported Tiffany image. I suspect that they are shorting CDOs to cover losses that they had/have/will have on CDO related assets. And its doing this as fast it could, probably leveraged on those short positions to the hilt.

    GS's chart looks weak, in fact, all technical trends point to a precarious position of a drop (how substantial is another question).

    GS is of course networked into gov't around the world with ex-corporate officers in all prominent gov't positions so it probably has info before every one else knows. But it will drop in the next few weeks.
  • TJ_98370TJ_98370
    ..
    I agree with SunTzu

    Goldman Sachs
    ..
  • AwaySoonerAwaySooner
    Everytime financial company put out "good news", I buy more puts. Just picked up some very expensive GS April puts. It'll take some time but not matter how you package turd, it's still turd.

    I wouldn't pick the bottom yet, but I think the real investment would be conservative regional banks. When the subprime mess is over (timing is everything right?), these banks would get acquired.
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