US secretly tried to make deal with Goldman Sachs in wake of financial crisis

BREAKING 10:08 AM ET:Vanity Fair will report in the next issue of the magazine that US Treasury Secretary Henry Paulson — a former head of the investment bank Goldman Sachs — tried to orchestrate secretive deals in the midst of the financial crisis but got blowback from prominent investor Warren Buffett. The following press release was obtained by Raw Story; the magazine appears today on newsstands in New York and Los Angeles.

EW YORK, N.Y.—The government secretly tried to orchestrate a deal involving Goldman Sachs in the week following Lehman Brothers’ collapse and considered using the Federal Reserve to help support such a transaction, Andrew Ross Sorkin reports in the new issue of Vanity Fair.

In an excerpt from his forthcoming book, Too Big To Fail: The Inside Story of How Wall Street and Washington Fought to Save the Financial System—and Themselves, Sorkin reports that the deal, which was nearly consummated, would have merged Goldman Sachs and Wachovia. Henry M. Paulson, the Treasury secretary and former C.E.O. of Goldman, was deeply involved in the process, contacting both Lloyd Blankfein, Goldman’s current C.E.O., and a Wachovia board member, and strongly urged both to consider it. Wachovia’s C.E.O., Robert Steel, was a former vice-chairman at Goldman Sachs and Paulson’s former number two at the Treasury Department.

Sorkin reports that Warren Buffett was also contacted about investing in the merged company, but told a banker at Goldman that it would never happen. “By tonight the government will realize they can’t provide capital to a deal that’s being done by the former firm of the Treasury secretary with the company of a former vice-chairman of Goldman Sachs and former deputy Treasury secretary,” Buffett said. “There is no way. They’ll all wake up and realize, even if it was the best deal in the world, they can’t do it.”

rawstory.com...

Everything is ok! Nothing to see here move along. That's a good sheep!

No but seriously, is anyone surprised by these backroom deals and shenanigans?
I'm overjoyed that they are coming to light because perhaps it will awaken a few more sheep.

Cross your fingers!

Ssshhh...

Now don't raise a stink...they went to all that trouble, to make sure the rug was stapled down after they swept it under...

At least WB was smarter than Paulson!