The Executive Director of Goldman Sachs defended the company’s role in the creation of complex securities, considered by some to be the cause of the financial crisis, Reuters reported. Lloyd Blankfane had to answer questions from the committee investigating the causes of the crisis, focusing on the creation by Goldman risk on derivatives of mortgages, while the bank has been going on short sales with them, or bet for lowering their value. “These exposures are sought by professional investors,” said Blankfeyn, who occasionally interrupted the committee chairman, Phil Angelides. “Even now people come to us asking for exposures to these instruments,” he added. “I sound a little like to sell a car with damaged brakes and then buy an insurance policy to the buyer of the car, not comment on Angelides. Testimony before the Committee, except Blankfeyn, have CEOs of JPMorgan Chase Jamie Diamond and Bank of America Brian Moynihan, as chairman of Morgan Stanley John Mack. Have defended the four practices before the Commission to distribute bonuses in the sector, while recognizing the need for regulatory changes. Angelides has four bank directors warned that the committee will continue throughout the year with hearings on hundreds of witnesses. Commission created by Congress in model Pekora committee investigating the collapse of Wall Street in 1929, must submit its report by 15 December. Pekora findings of the Committee helped lead to the creation of the U.S. stock regulator (SEC) and other major reforms.
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