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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
saurabh kr Sinha
27 Mar 15 03:00:54
RT @GoldmanSachs: Wishing the best of luck to our $GS colleagues & @EverestAlps team on the final ascent today! All for @BrainTumourOrg htt…
John Lothian
27 Mar 15 02:57:54
RT @GoldmanSachs: Wishing the best of luck to our $GS colleagues & @EverestAlps team on the final ascent today! All for @BrainTumourOrg htt…
BreakingStocksNews
27 Mar 15 02:57:01
$GS: Oil Pares Weekly Gain as Traders Weigh Yemen Strife Against Glut: http://t.co/gO7fXdB1J7
condessa cuna
27 Mar 15 02:51:19
RT @GoldmanSachs: Wishing the best of luck to our $GS colleagues & @EverestAlps team on the final ascent today! All for @BrainTumourOrg htt…
VoterGames
27 Mar 15 02:49:53
RT @GoldmanSachs: Wishing the best of luck to our $GS colleagues & @EverestAlps team on the final ascent today! All for @BrainTumourOrg htt…
Capital Market Labs
27 Mar 15 02:48:09
Largest Diversified Financials Earnings 1. $BRK.A 2. $GS 3. $AXP Full Chart: http://t.co/MFo8uUUAJA
Partiss
27 Mar 15 02:46:59
RT @GoldmanSachs: Wishing the best of luck to our $GS colleagues & @EverestAlps team on the final ascent today! All for @BrainTumourOrg htt…
Squawky Digital
27 Mar 15 02:46:34
RT @GoldmanSachs: Wishing the best of luck to our $GS colleagues & @EverestAlps team on the final ascent today! All for @BrainTumourOrg htt…
SocialImpactFinance
27 Mar 15 02:46:30
RT @GoldmanSachs: Wishing the best of luck to our $GS colleagues & @EverestAlps team on the final ascent today! All for @BrainTumourOrg htt…
Goldman Sachs
27 Mar 15 02:45:11
Wishing the best of luck to our $GS colleagues & @EverestAlps team on the final ascent today! All for @BrainTumourOrg http://t.co/HkQ2LS16BI
Breaking News
27 Mar 15 02:40:02
$GS-PB: UK FTSE eyes 2 pct weekly fall as basic resources weigh: http://t.co/t6e8QxWl9l
Ophir Gottlieb
27 Mar 15 02:20:38
Largest Diversified Financials Revenue 1. $BRK.A 2. $GS 3. $MS Full Chart: http://t.co/EARLOsTLiF
NASDAQ
27 Mar 15 02:19:06
$GS - Chevron to Sell Caltex Australia Stake -- Update http://t.co/fXjmHGZpWs
ProVesting
27 Mar 15 02:02:02
$GS $MS: Novo Nordisk Soars on Plan to Resubmit Rejected Insulin in U.S.: http://t.co/Z0jiUXroDD
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27 Mar 15 01:55:49
Our Penny Stock Pick On $THCZ Is Up 321.54% In Less Than 6 Weeks! This is Huge: http://t.co/WroUGtaeZF $GS $ZION $ISRA
Breaking News
27 Mar 15 01:52:02
$GS: Pleasant surprise may be in store in bank earnings in April: http://t.co/WIm5RspYxD
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27 Mar 15 01:42:52
Our Winning Stock Tips Gained Over 680% In The Past 2 Months! Subscribe Today: http://t.co/lLjJU4COQW $GS $ZION $ISRA
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27 Mar 15 01:37:00
Our Penny Stock Picks Have Gained Over 1485% In The Past 4 Months! MASSIVE Update: http://t.co/Nr8lmTigQP $GS $ZION $ISRA
Assumption
27 Mar 15 00:44:08
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Spencer Clarke
27 Mar 15 00:39:58
RT @richbravo2: A history of Goldman Sachs's net interest margin, a measure of lending profitability. $GS http://t.co/aIcYejGaBO
Penny Stockington
27 Mar 15 00:34:16
Our Penny Stock Alerts Have Gained Over 1000% So Far This Year! Big News: http://t.co/Mq9GADvqO5 $GS $ZION $ISRA
Breaking News Now
27 Mar 15 00:34:02
$GS-PB: MORNING BID EUROPE-A daily note from our Economics/Politics ...: http://t.co/C6fh4ZQAoI
NASDAQ
27 Mar 15 00:30:12
$GS - JPMorgan holds on to top investment banking spot http://t.co/lvKOvoxn0D
Quantpost Financial
27 Mar 15 00:28:58
$JPM $GS $C $BAC News: "JPMorgan holds on to top investment banking spot $JPM $GS …" http://t.co/Xrz2MQKdQk Quote: https://t.co/EbpjW5vgz8
Financial Stocks
27 Mar 15 00:28:58
JPMorgan holds on to top investment banking spot http://t.co/ntkFlvJ2Ul $JPM $GS $C $BAC
SA Breaking News
27 Mar 15 00:28:57
JPMorgan holds on to top investment banking spot http://t.co/0wcQvNmpvU $JPM $GS $C $BAC
Dow Stocks
27 Mar 15 00:18:07
#Dow #stocks $GS Goldman Sachs Daily:-0.06% Weekly:-1.44% YTD:-3.09% Trend:8 / 100 http://t.co/m75xjhRdrr
omino del gas
27 Mar 15 00:13:13
RT @JavierBlas2: #oil watch: #Brent crude down as #Yemen fears recede; short-covering rally ends. $GS says not risk for oil flows http://t.…
FinSentS SP500
27 Mar 15 00:10:20
$GS:US Signet Jewelers Limited Stock Rating Reaffirmed by Goldman Sachs (SIG) #GOLDMAN SACHS GROUP INC http://t.co/l5hinddcED #SP500
Juan
27 Mar 15 00:04:39
RT @JavierBlas2: #oil watch: #Brent crude down as #Yemen fears recede; short-covering rally ends. $GS says not risk for oil flows http://t.…
Javier Blas
27 Mar 15 00:01:37
#oil watch: #Brent crude down as #Yemen fears recede; short-covering rally ends. $GS says not risk for oil flows http://t.co/CpzwD3a7cE
Гарри Степанов
26 Mar 15 23:44:04
RT @anepdopdu: $GS and Ted Cruz paid and bought for Goldman Sachs? And will he eff over millions as Gov. Jon Corzine did?
StockNewsWires
26 Mar 15 23:40:02
$GS: Recent Investment Analysts' Ratings Updates for Goldman Sachs (GS): http://t.co/wOTra7V6ne
Capital Market Labs
26 Mar 15 23:36:28
Largest Diversified Financials Earnings 1. $BRK.A 2. $GS 3. $AXP Full Chart: http://t.co/MFo8uVcbB8
Roger
26 Mar 15 23:36:14
RT @bored2tears: WSJ: Bond market volatility likely to drive up Wall Street #banks trading revenue. http://t.co/LA6vPflCHX $BAC $C $GS $JPM…
Ticker Report
26 Mar 15 23:35:15
Recent Investment Analysts’ Ratings Updates for Goldman Sachs $GS http://t.co/W5EnxiwfcE
US Banking News
26 Mar 15 23:33:20
Recent Investment Analysts’ Ratings Updates for Goldman Sachs $GS http://t.co/bKafdNlGUb
ProVesting
26 Mar 15 23:12:02
$JPM $MS $GS $C: Goldman Overtakes JPMorgan in Commodities After Mercuria Sale: http://t.co/UI2K84LWPL
Justin
26 Mar 15 22:48:55
RT @bored2tears: WSJ: Bond market volatility likely to drive up Wall Street #banks trading revenue. http://t.co/LA6vPflCHX $BAC $C $GS $JPM…
DK1
26 Mar 15 22:19:04
$GS--> Fri lotto over today's high http://t.co/zBT15QIB8T
StockNewsWires
26 Mar 15 21:35:05
$GS: Oil prices fall more than $1 as supply threat eases: http://t.co/8Ir3YbxQZN
Peak News ★
26 Mar 15 21:33:48
RT @FinConInc: Ted Cruz Won’t Say How Much Wife Makes at Goldman Sachs http://t.co/6pZsSP9GjS #WallStreetBanksters $GS Criminals http://t.c…
Baidu Planet ●
26 Mar 15 21:29:19
RT @FinConInc: Ted Cruz Won’t Say How Much Wife Makes at Goldman Sachs http://t.co/6pZsSP9GjS #WallStreetBanksters $GS Criminals http://t.c…
StockNewsWires
26 Mar 15 21:22:01
$JPM $MS $GS $C: Goldman Overtakes JPMorgan in Commodities After Mercuria Sale: http://t.co/E8sIj6Xhrt
Google Investor ♦
26 Mar 15 21:15:13
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Capital Market Labs
26 Mar 15 21:01:58
Largest Diversified Financials Earnings 1. $BRK.A 2. $GS 3. $AXP Full Chart: http://t.co/MFo8uVcbB8
zinvestmentz
26 Mar 15 19:53:06
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26 Mar 15 19:51:47
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Sven
26 Mar 15 19:38:19
RT @etfguide: VIDEO: A Defective $863,309 Advisor Managed Investment Portfolio http://t.co/nejXKmFUL0 #PortfolioReportCard $MS $GS $RJF $LP…
Capital Market Labs
26 Mar 15 19:24:58
Largest Diversified Financials Assets 1. $GS 2. $MS 3. $BRK.A Full Chart: http://t.co/7PkHIfc8s6
				
				
  +Follow August 1, 2013 6:46AM
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