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Dear Mr. Berko:

Dear S.A.:

My opinion of Goldman Sachs hasn’t changed in a dozen years. Goldman Sachs Group Inc. (GS-$158) 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 as 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 the 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, collateralized debt obligation, auction-rate securities and commercial paper markets suffer near-fatal damage, and I wondered to what extent Goldman Sachs encouraged this brouhaha.

I’m in awe of the raw power of Goldman Sachs, its CEO, Lloyd Blankfein – reminiscent of Gordon Gekko of the 1987 film “Wall Street” – and his generals who decide the world’s financial outcomes from their Wall Street towers.

I watched with fear as they surgically eviscerated Lehman Bros., Bear Stearns, Fannie Mae and 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 the company’s records.

Goldman Sachs is accused of fabricating and disseminating misinformation so it could profit from the subsequent decline in share prices. I hope a review of Goldman Sachs’ trading activities will not show that the company 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.

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 its own benefit. However, 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,” and I would not be surprised a tick if Goldman Sachs is guilty. But Blankfein might have the power to make any subpoena disappear.

Though I might have been technically correct in recommending the sale of Goldman Sachs, I believe it will emerge as a stronger 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, Fla. 33429 or e-mail him at malber@adelphia.net. © Copley News Service