Dear Mr. Berko: In early May I bought 50 shares of Goldman Sachs at $201 believing it would split 2-for-1, double its dividend to $2.80 and within a year run back up to its pre-split price. In responding to my letter you told me that I should sell the stock because you thought senior management was "disingenuous" (I had to look up that word) and that some professionals believe that its powerful trading desks had manipulated the mortgage and oil markets in a way that could lead to a federal investigation. Now that the price of oil seems to be going lower and the mortgage market has settled, has your opinion changed on Goldman Sachs? — S.A.: Vancouver, Wash.

Dear S.A.: My opinion of Goldman Sachs hasn't changed in a dozen years. Goldman Sachs (GS-$174.80) has access to such impressive financial and political information from every nook and cranny of the world that the CIA, KGB and Mossad would die for its intelligence. Because Goldman Sachs is not bound by the constraints of political correctness, it can use that intelligence it wishes.

Yet Goldman Sachs could be one of the most un-American of all the American companies on the Big Board. Because so many of its ex-partners hold very sensitive and influential positions in the State Department, the Defense Department, Department of Treasury, the Export-Import Bank of the United States, The National Economic Council, the New York Stock Exchange, the Commerce Department, the CIA and even the president's chief of staff, Goldman Sachs might be immune from prosecution.

I watched Bank of America, Citigroup, Wachovia, Fannie Mae and Freddie Mac figuratively and literally implode. I watched the mortgage market collateralized debt obligations, the auction-rate securities and commercial paper market suffer near fatal damage and I wondered to what extent Goldman Sachs encouraged this brouhaha.

While the blood was gushing in the gutters, it frightened me when Lehman Bros., Citicorp, and Merrill Lynch were forced to beg and borrow billions from Middle East investors, and Bear Stearns, to save itself from bankruptcy, was compelled to merge with JP Morgan Chase & Co.

I'm in awe of the raw power of Goldman Sachs, its CEO Lloyd Blankenfein — aka Gordon Gekko of the 1987 film "Wall Street"— and his generals who decide on the world's financial outcomes from their Wall Street towers.

I watched with fear as they surgically eviscerated Lehman Bros., Bear Stearns, Fannie Mae, Freddie Mac, only stopping within a few pints of forcing them into bankruptcy. What's more, according to compelling testimony by Dick Fuld, CEO of Lehman Bros, and Alan Schwartz, former CEO of Bear Stearns, Goldman Sachs was so egregious in aiding and abetting this financial chaos that the Securities and Exchange Commission had to issue subpoenas for Goldman Sachs' records.

Goldman Sachs is accused of rank perfidy, of fabricating misinformation and its dissemination so it could profit from the subsequent decline in share prices. I hope a review of Goldman Sachs' trading activities will not show Goldman Sachs profited handsomely from the bedlam at Bear Stearns, Fannie Mae, Lehman, Wachovia, etc. And I hope review of Goldman Sachs' trading records will not expose huge profits from its oil trading operations. But because Schwartz and Fuld have compelling information, the SEC was forced to issue its subpoenas.

Now, some observers suggest that Goldman Sachs is no guiltier of rumormongering than Mahatma Gandhi was guilty of cheating at checkers. They would suggest that Goldman Sachs is not involved in any wrongdoing but at best is guilty of using its enormous resources and connections to satisfy its inexorable avarice and greed.

I don't know if Goldman Sachs is guilty of misfeasance, malfeasance or any kind of feasance. At worst, Goldman Sachs might be guilty of purposeful and wanton disregard in damaging the solvency of this nation's financial institutions for personal benefits. However, when a Goldman Sachs lad bragged that: "Oil prices go up when we want them to go up and they go down when we want them to go down," I would not be surprised a tick if Goldman Sachs is guilty of both counts. But as the emperor of Goldman Sachs, Lloyd Blankenfein, who some say is the love child of Genghis Kahn, might have the power to make any subpoena disappear.

Meanwhile, the attorney general of New York recently filed suit against Union Bank of Switzerland for deceptively steering clients into auction-rate securities. I think this could be the basis and beginning of similar actions. If the allegations of the CEOs at Lehman and Bear Stearns have merit, then Goldman Sachs could be spending a lot of nickels defending itself in court.

While I might have been technically correct in recommending the sale of Goldman Sachs, I believe it will emerge unscratched as a stronger and more dominating international institution. Hold on to your shares because Goldman Sachs' earnings this year and next could knock your socks off.

Please address your financial questions to Malcolm Berko, P.O. Box 1416, Boca Raton, FL 33429 or e-mail him at malber@comcast.net. To find out more about Malcolm Berko and read features by other Creators Syndicate writers and cartoonists, visit the Creators Syndicate website at www.creators.com.

COPYRIGHT 2008 CREATORS SYNDICATE, INC.

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