Four of Wall Street's top executives offered some contrition and a solid defence of their actions yesterday as the head of an inquiry promised to use wide-ranging powers to establish the causes of the financial crisis and pursue any wrongdoing.
Lloyd Blankfein of Goldman Sachs, Jamie Dimon of JPMorgan, John Mack of Morgan Stanley, and Brian Moynihan of Bank of America, maintained a united front as the Financial Crisis Inquiry Commission, headed by Phil Angelides, probed the bail-out of AIG, risk management and executive compensation. Mr Blankfein, whose bank has become a lightning rod for public anger at Wall Street, bore the brunt of the panel's questions. He mounted a robust defence after being asked whether part of his business was akin to selling a car with faulty brakes and then buying an insurance policy. But he added: “Anyone who says I wouldn't change a thing, I think, is crazy.”
The Goldman boss said that he and his rivals had been insufficiently sceptical of loose credit standards. “We rationalised [it] because a firm's interest in preserving and growing its market share, as a competitor, is sometime blinding – especially when exuberance is at its peak.”