The Obama administration's economic intervention efforts unfortunately have a litmus test for gauging whether or not the world economic order is stabilising, Goldman needs to be able to continue making huge amounts of money using the old models. The Goldman test is of course Geithner's plan for using public subsidisation of trading capital for Goldman and others, resulting in wider profit margins helped by being able to look at all the stimulus cards. While the fools in the Republican party complain about the inevitable middle class becoming slaves to socialism, the financial industry, a Republican stalwart, keeps applying the old model skills. Now this test will confirm Goldman is healthy and the credit lines between the rest of the lower economic forces are moving, but ultimately will provide little life for the general population as jobs stagnate and their assets dwindle.
Obama's recent statements explaining the need for patience to allow the stimulus to work is a clear sign it is not having any effect on the larger economy. The velocity with which Goldman has recovered under direct subsidy by the G will become a greater problem as Goldman disappears over the greater wealth horizon, leaving the rest to scolded by Republicans that those rewards are not meant for us.
