Damodaran on the grilling of Goldman Sachs : “mixed feelings”

“While I understand the urge to bring the mighty back to earth, I think that failing to support Goldman at this time is a huge mistake,” admits Professor Aswath Damodaran (NYU Stern School of Business) in his blog Musings on Markets. “To me, this case reveals everything that is wrong with both politics and law - the use of ex-post evidence to back up a case (Paulson made money of the housing crash.. so, he must have known that the crash was coming), suspicious timing (just in time for the new law on regulating bank) and scapegoating,” he says. Still, he’s right—appraisers deserve to take a certain pleasure in watching the whole episode of overvalued securities--and their creators--returning to reality.