Senators. Watching today’s hearing, I’m left with the impression that the politicians are megalomaniacal, hypocritical and ignorant. The Goldman guys are sharks, to be sure, but here they come across as pretty straightforward.

The Senators seem to just be fishing for sound bites, with very little understanding of what was actually going on in the mortgage business. Susan Collins seemed unable to grasp the difference between a market maker (a kind of trader) and an investment advisor, when she asked over and over again if these Goldman market makers had a fiduciary duty to their clients.

Now this guy Kaufman seems hung up on stated income loans, as if Goldman were wholly responsible for the loose lending standards of that era. What about the idiots running the multi-billion dollar endowments and pension plans who bought these securities? They were more responsible for the bubble than these middle-men, since without their willingness to buy anything with a yeild premium lending standards could not have gotten out of hand.

And what about the government-sponsored rating agency cartel? What about Fannie, Freddie and the Fed? FDIC, etc, etc.? This is just scapegoating as usual.

UPDATE, 4:50 EST:

I can’t believe it. I’m rooting for the Goldman guys over this blowhard from Detroit, Carl Levin, and the rest of these ignorant hypocrites.

Foot-in-the-mouth comment from CFO David Viniar just now, in response to Levin’s question about how he felt when reading those old emails: “I think it’s very unfortunate to have that on email.”

I’m actually surprised that Goldman wasn’t better about controlling email. Why allow any of this stuff to be put in emails, and to retain them? What’s wrong with the proverbial smokey room?

The more I watch, the more peeved I get about the general thrust of this witchhunt. Goldman was a middleman and a trader, that’s it. They sold these products to very big money players. Those guys were the negligent ones, where the real blame lies, along with the government and central bank that fueled this blaze with moral hazard.