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Goldman Sachs Offers to Release Aluminum Amid Accusations of Stockpiling

  +Follow August 1, 2013 6:46AM
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Facing worldwide shortages, Goldman Sachs Group Inc (GS) has indicated that they might run loose some of their massive stores of aluminum. The financial giant has come under intense scrutiny following reports that they were deliberately mismanaging aluminum shipping to cause worldwide shortages and ultimately profit off of a manipulation of the commodities market.

The New York Time alleged that the bank choreographed an “industrial dance” that artificially raised the price of the metal, thus gouging consumers out of billions of dollars. Aluminum is used widely the world over to make soda, juice, and beer cans. The United States alone goes through 90 billion cans of aluminum a year.

Analyst Tim Wiener of beer manufacturer MillerCoors LLC testified to the U.S. Senate that increased warehousing times for aluminum had inflated aluminum prices $3 billion in 2012.

Banks involvement in the commodities market has long been historically prohibited by American regulation. The first indications banks would be able to get into commodity trading began with the gradual dissolution of the Glass-Steagall Act in 1999, which prohibited commercial and investment banks from engaging in the same activities.  In 2003 the Federal Reserve officially began allowing investment banks to trade physical commodities.

If Goldman has been manipulating the commodities market (and evidence is mounting that they did create artificial aluminum scarcity to drive up prices) it raise the question of whether investment banks should be allowed in the commodity market at all. Since the investment banks are now allowed to own warehouses and shipping ventures, they are made privy to knowledge concerning commodity storage and shipping that oftentimes would be considered insider trading. But simultaneously owning commodites and trading their futures is entirely legal, thanks to the 2003 decision.

But possibly not for long.  A proposed new regulatory bill, dubbed the “21st Century Glass-Steagall,” currently enjoys bi-partisan support. And on July 20 the Federal Reserve elected to review that decision, which could force the banks out entirely.

Other investment houses are voluntarily divesting from physical commodities trading, as threat of legal action increases. JP Morgan Chase & Co. (JPM) is fleeing the commodities market altogether, and is putting their entire trading desk up for sale. On July 29, JP Morgan was forced to pay out a settlement of $410 million for engaging in price manipulation of the power market.

But for the time being, Goldman, while releasing a large chunk of their stored metals, have no intention of leaving commodities altogether. Goldman CEO Gary D. Cohn has already said, “Commodity hedging is a core competency and one of the most important things we do in the firm, and our clients really need us to be in that business. We are staying in.”

Goldman’s stock was up .99 percent to close the day at $164.03. The stock is up 23.37 percent on the year.

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Results for gs
Zoe Ch
24 May 15 19:58:23
RT @GoldmanSachs: $GS CEO Lloyd Blankfein & President Gary Cohn's letter to shareholders: http://t.co/mYEM5t1bZA #GSAnnual2014 http://t.co/…
Stock Dawgzz
24 May 15 18:40:25
$DRNK Has Become One Of The Fastest Moving Penny Stocks In The Past 2 weeks! Big News: http://t.co/vFCVfQa85k $GS $ZION $ISRA
StockenheimerSchmidt
24 May 15 18:33:43
Our Penny Stock Pick On $TLFX Gained 70% in the past week and a half! Big Things coming: http://t.co/uooe3E8vs2 $GS $ZION $ISRA
Penny Stockington
24 May 15 18:32:36
Our Penny Stock Alerts Gained Over 3300% For Subscribers In 7 Months! See Our New Picks: http://t.co/nLJyVU6RRw $GS $ZION $ISRA
Stock Rocket
24 May 15 18:31:25
Our Stock Alerts Gained Over 1300% In Less Than 3 Months! See Our New Picks: http://t.co/keLIhbbQwg $GS $ZION $ISRA
Stockaholics
24 May 15 18:27:02
Our Penny Stock Pick On $THCZ Is Up 570.77% For Platinum Members! Big Update: http://t.co/dXhKtfHUdQ $GS $ZION $ISRA
ProVesting
24 May 15 17:58:02
$GS: Gold Drops Toward $1200 as Interest Rate Outlook Boosts Dollar: http://t.co/HVHI9o4Fsu
Stock Market Picks
24 May 15 17:28:08
$GE $GS $HD $IBM $INTC $JNJ $JPM Long and short positions from the Dow Jones, up to 1800% since 2008. http://t.co/XxX6vz3Gm9 $DJIA $DIA
BreakingStocksNews
24 May 15 17:06:01
$GS: Dollar Maintains Gains on Rate Outlook While Zloty, Copper Drop: http://t.co/NJGpF6ZucJ
Gavin Martinsson
24 May 15 16:27:27
$GS just revised their Oil forecast.... Well, they just gave you a floor.
ProTradersNews
24 May 15 16:27:02
$GS: PBOC Lowers Shibor Most Since 2008 to Help Clear China Debt Pile: http://t.co/saP6avuct7
Aaron Krolik™
24 May 15 16:20:08
If you can't beat these pigs, join them $GS. The stock just trades up. Anything under $210 is a buy. @puerto_paslen @PearlJen09 @jimcramer
Breaking News Now
24 May 15 16:17:01
$GS: Nigeria's Amcon Recovers 57% of Bad Debts Bought in Bank Crisis: http://t.co/0Sdup1rz43
JGM
24 May 15 15:36:17
@manuelhe @btcArtGallery Brianna'll do fine at $GS as will Antonio at @MSF_USA but yep, Jeremiah gets the outlier go big or go home award ;)
Investment+TaxStrat
24 May 15 15:29:01
RT @JavierBlas2: #oil watch: #WTI crude is nearly 10% up in two days without much reason (and despite $GS talking down the market) http://t…
FinSentS SP500
24 May 15 15:14:36
$GS:US Goldman Sachs : Young boss won't be caught napping #GOLDMAN SACHS GROUP INC http://t.co/ne6xyuO7qm #SP500
Chad Terhune
24 May 15 15:11:47
RT @spfeifer22: Want to build a new sports stadium? Give the ball to Goldman Sachs http://t.co/CBBqPpJTR4 #NFL #NBA #MLB #finance $GS via @…
Pauly@spz_trader
24 May 15 14:35:28
@Georgs1996 that boutique firm blows everyone including $GS out of the frickin water. IF they say its happening my ears perk up.
Coolhwip
24 May 15 13:54:31
RT @spfeifer22: Want to build a new sports stadium? Give the ball to Goldman Sachs http://t.co/CBBqPpJTR4 #NFL #NBA #MLB #finance $GS via @…
PokerJunkie ♠♥♣♦
24 May 15 13:22:34
RT @spfeifer22: Want to build a new sports stadium? Give the ball to Goldman Sachs http://t.co/CBBqPpJTR4 #NFL #NBA #MLB #finance $GS via @…
Stuart Pfeifer
24 May 15 13:22:07
Want to build a new sports stadium? Give the ball to Goldman Sachs http://t.co/CBBqPpJTR4 #NFL #NBA #MLB #finance $GS via @ByTimLogan
Capital Market Labs
24 May 15 12:48:21
Largest Diversified Financials Assets vs. Stock Buy-backs $GS $TROW $IVZ $BLK Chart: http://t.co/GOSw64X1wN http://t.co/A2dn47wD4d
tim schwemmer
24 May 15 10:19:31
Bio update. I'm a vegetarian so I don't eat sheep. Unless your $GS trying to talk down oil.
Stock Dawgzz
24 May 15 10:06:51
$DRNK Has Become One Of The Fastest Moving Penny Stocks In The Past 2 weeks! Big News: http://t.co/vFCVfPSxdM $GS $ZION $ISRA
Penny Stockington
24 May 15 10:06:50
Our Penny Stock Alerts Gained Over 3300% For Subscribers In 7 Months! See Our New Picks: http://t.co/nLJyVUosJ4 $GS $ZION $ISRA
StockenheimerSchmidt
24 May 15 10:02:05
Our Penny Stock Pick On $TLFX Gained 70% in the past week and a half! Big Things coming: http://t.co/uooe3E8vs2 $GS $ZION $ISRA
Stock Rocket
24 May 15 10:00:44
Our Stock Alerts Gained Over 1300% In Less Than 3 Months! See Our New Picks: http://t.co/keLIhbbQwg $GS $ZION $ISRA
Stockaholics
24 May 15 09:55:26
Our Penny Stock Pick On $THCZ Is Up 570.77% For Platinum Members! Big Update: http://t.co/dXhKtfHUdQ $GS $ZION $ISRA
Edi Cohen
24 May 15 09:28:32
RT @GoldmanSachs: $GS women discuss work/life balance, #motivation @ Association of Women in Finance #Tokyo: http://t.co/SQAfUerKn1 http://…
Winston Henderson
24 May 15 09:19:45
RT @GoldmanSachs: #Millennials: the largest gen. in US history is transforming the consumer #economy, says $GS' Lindsay Drucker Mann: http:…
Роман Костин
24 May 15 09:16:06
Their home address ends in '.com' – $GS' Lindsay Drucker Mann on how #millennials are changing the consumer #economy:
Robert Lesnicki
24 May 15 07:59:18
Top 10 YTD S&P 500 performers and more: http://t.co/Xoyechz5FM $SPY $GS $NFLX $AMZN $SWKS
FinSentS SP500
24 May 15 07:09:56
$GS:US Goldman Sachs : Young boss won't be caught napping #GOLDMAN SACHS GROUP INC http://t.co/AgPuZNQDmc #SP500
PoorSinner.Com
24 May 15 06:57:34
RT @GoldmanSachs: .@nyuniversity's John Sexton & $GS' Lloyd Blankfein on globalization of #education: http://t.co/qeGbPB6nfq #TalksAtGS htt…
BreakingStocksNews
24 May 15 05:58:03
$GS: Goldman Sachs Receives $200.57 Average Target Price from ...: http://t.co/8ja4aQbEGX
Trader Gang
24 May 15 05:57:59
@CNBC @financialtrader @jimcramer didn't Jim not like $TSLA at $50..$70..90.per share? $GS for Trustfund Meatheads.
Dakota Financial
24 May 15 05:54:14
Goldman Sachs Receives $200.57 Average Target Price from Analysts $GS http://t.co/zln3hBiyaK
Marvin Clark
24 May 15 05:46:10
Proactive In The Face Of Volatility $GS $BAC http://t.co/tvpeEqu1w0
Pepe Plata
24 May 15 05:22:45
http://t.co/0TzsjiGtNc $TUBE TubeMogul Inc $15.11 $GE $GS $HD $IBM $INTC $JNJ $JPM
Bad * Charts
24 May 15 05:00:06
Breakout in progress. Check prev. post and updated chart. http://t.co/YB8R4Ox96y $GS http://t.co/dzwjbJW0Lh
hyrontrader
24 May 15 04:53:08
If u can securitze windfarm refi to fund wildlife reserve ("tht u got on a deal"/ someone cldn't pay up), what else can u securitize? Ty $GS
Hector
24 May 15 04:22:12
RT @seeitmarket: Are Bank Stocks Ready To Lead The Market Higher? http://t.co/Tf6wSOfqvw by @andrewnyquist $BKX $JPM $GS $WFC $C $BAC
Amandine
24 May 15 02:34:05
RT @GoldmanSachs: $GS women discuss work/life balance, #motivation @ Association of Women in Finance #Tokyo: http://t.co/SQAfUerKn1 http://…
Buffonge Aldwark
24 May 15 02:13:11
U.S. Treasury to Sell $72 Billion in Long-Term Debt $BAC $C $GS $JPM $MS
Stock Dawgzz
24 May 15 00:58:44
$DRNK Has Become One Of The Fastest Moving Penny Stocks In The Past 2 weeks! Big News: http://t.co/vFCVfQa85k $GS $ZION $ISRA
Penny Stockington
24 May 15 00:57:43
Our Penny Stock Alerts Gained Over 3300% For Subscribers In 7 Months! See Our New Picks: http://t.co/nLJyVUosJ4 $GS $ZION $ISRA
StockenheimerSchmidt
24 May 15 00:56:10
Our Penny Stock Pick On $TLFX Gained 70% in the past week and a half! Big Things coming: http://t.co/uooe3E8vs2 $GS $ZION $ISRA
Stock Rocket
24 May 15 00:54:24
Our Stock Alerts Gained Over 1300% In Less Than 3 Months! See Our New Picks: http://t.co/keLIhbbQwg $GS $ZION $ISRA
Stockaholics
24 May 15 00:53:15
Our Penny Stock Pick On $THCZ Is Up 570.77% For Platinum Members! Big Update: http://t.co/dXhKtfHUdQ $GS $ZION $ISRA
Lauren Chan
23 May 15 23:29:07
RT @GSCareers: .@PitchPerfect has nothing on the $GS #SLC #Diversity #Leadership Symposium. Check out the team's creative "cups" http://t.c…
				
				
  +Follow August 1, 2013 6:46AM
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