How the Inventors of Dragon Speech Recognition Technology Lost Everything

First time accepted submitter cjsm writes "James and Janet Baker were the inventors of Dragon Systems' speech recognition software, and after years of work, they created a multimillion dollar company. At the height of the tech boom, with investment offers rolling in, they turned to Goldman Sachs for financial advice. For a five million dollar fee, Goldman hooked them up with Lernout & Hauspie, the Belgium speech recognition company. After consultations with Goldman Sachs, the Bakers traded their company for $580 million in Lernout & Hauspie stock. But it turned out Lernout & Hauspie was involved in cooking their books and went bankrupt. Dragon was sold in a bankruptcy auction to Scansoft, and the Bakers lost everything. Goldman and Sachs itself had decided against investing in Lernout & Hauspie two years previous to this because they were lying about their Asian sales. The Bakers are suing for one billion dollars."

Comments

Ironic

[Anonymous Coward]

I thought Goldman Sachs were the good guys?

Re:Ironic

[fizzer06]

They are NOT.

Re:Ironic

[griffo]

No, they are actually te baddest of te bad. Responsible for Euro crisis, credit crisis, mortgage crisis et al. Too smart and too greedy. It's high time Goldman Sachs and former associates are made to PAY BACK what they STOLE!

Re:Ironic

[jo42]

Since when has Wall Street (Goldman Sachs, Lehman Brothers, AIG, et al) done anything other than for themselves?

They take the little guys money and bend them over (without a tube of Vaseline).

Re:Ironic

[Anonymous Coward]

but but but ... Goldman's CEO Blankfein said they're doing God's work in there, they MUST be good guys!

... for some definitions of 'God' and 'good guys', anyway

Re:Ironic

[Bob9113]

I thought Goldman Sachs were the good guys?

They are! That's why the Hope & Change President decided to put change on hold and continue the long-standing tradition of stuffing the White House with Goldman alums and associates and sending administration people back.

Re:Ironic

[Tough Love]

I thought Goldman Sachs were the good guys?

Since when? Goldman Sachs has always been a nest of vipers. Watch the videos of Lloyd Blankfein lying through his teeth.

And while you're at it, note how Warran "Wise Grandfather" Buffet always closes ranks with these crooks.

Re:Ironic

[cpu6502]

They should have been left to die, rather than bailed-out. (i.e. Vote no on TARP rather than help GS.)

Re:Ironic

[Undead Waffle]

The funny part is that originally the investment banks (Goldman Sachs, Bear Sterns) were not part of the FDIC and thus could not receive money from the Federal Reserve because they were not real banks. They had to be re-classified as normal banks to make it legal to give them money. But that wasn't a problem because The Secretary of the Treasury at the time was a former CEO of Goldman Sachs.

Re:Ironic

[hairyfeet]

The sad part is they won't win, and GS will NEVER go away. look at their history, they've been knee deep in dirty dealing for over a century now and have learned how to slime their way through the halls of power. its no coincidence that so many in the Fed are tied into GS, hell they are practically Wolfram and Hart on the evil scale. If they had demons in suits waltzing through their halls like on Angel frankly i wouldn't be surprised, any truly nasty corporate dealing that has made a lot of money while fucking people over? GS is there.

Re:Ironic

[desertfool]

Remember that GS was on the smart side of the mortgage trade... even though they were copying what another trader was doing. They knew that the mortgage mess was going to blow up. They sold sh*t funds of mortgages while betting against them. Read William Cohen's "Money and Power: How Goldman Sachs came to rule the world." for more info.

AIG were idiots for selling insurance on investments that the had no business in. GS bought boatloads of insurance against default of investments they didn't have. That is nothing more than gambling and should be taxed as such.

Re:Ironic

[Bob9113]

Gotta love that firedoglake citation. One of the most wacko sites on the internet, not an easy accomplishment.

Don't mistake my citation of one article for vouching for the site. I hadn't heard of FDL before today, and I only looked at that one article to check for veracity. That article looks to have been fairly well researched and documented. I know nothing of any other content on the site.

Re:Ironic

[Pinky's Brain]

Goldman Sachs will go bankrupt, all the major banks will ... they are just stepping stones.

What use is Wolfram and Hart when you have achieved hell on earth?

Re:Ironic

[Anonymous Coward]

You fail to mention the current Secretary of the Treasury was deeply involved in those decisions.

Re:Ironic

[Anonymous Coward]

Vote?

The Fed's expansion of liquidity, the biggest since credit markets seized up last year, came hours before the U.S. House of Representatives rejected a $700 billion bailout for the financial industry.

The Fed wrote checks for ~$630 billion to the banks, regardless of the outcome in Congress.

Re:Ironic

[locketine]

GS contributed to the economic collapse and benefited immensely from it. They are most definitely not stepping stones. Unfortunately they've corrupted their regulators so much that the US government will never set them straight.

Re:Ironic

[__aaltlg1547]

Since Blankfein thinks he is God, that makes sense.

Re:Ironic

[LilGuy]

That's because they are basically part of the US Gov't. How many "former" GS members have been in presidential cabinet members? Lots and for years. How many members of Congress have come from or moved to GS? Lots. They don't call it the revolving door for nothing. They're inextricably connected.

Re:Ironic

[garyebickford]

But the bailout required the relatively unregulated investment banks to become commercial banks, members of FDIC, and accept regulation. The Federal Reserve does act as lender of last resort for commercial banks (who do have to be members of FDIC), but had no authorization to lend money to investment banks. I think that's what he was talking about.

I'm actually working on a project related to this topic. For general info, one can look up every bank, bank holding company, saving and loan company, credit union etc., with any business in the US, at Federal Financial Institutions Examination Council's (FFIEC). You can see who owns who, who bought who, etc.

The Council is a formal interagency body empowered to prescribe uniform principles, standards, and report forms for the federal examination of financial institutions by the Board of Governors of the Federal Reserve System (FRB), the Federal Deposit Insurance Corporation (FDIC), the National Credit Union Administration (NCUA), the Office of the Comptroller of the Currency (OCC), and the Consumer Financial Protection Bureau (CFPB), and to make recommendations to promote uniformity in the supervision of financial institutions. In 2006, the State Liaison Committee (SLC) was added to the Council as a voting member. The SLC includes representatives from the Conference of State Bank Supervisors (CSBS), the American Council of State Savings Supervisors (ACSSS), and the National Association of State Credit Union Supervisors (NASCUS).

Re:Ironic

[garyebickford]

I might add that, as of a month or so ago (last time I checked), the following items were true - from memory, so I I may be a bit off:
1. The US Government spending is now over 40% of the Gross Domestic Product (GDP).
2. 40% of that spending is borrowed money
3. 60% of that borrowing is being lent by the Federal Reserve, as the world's appetite for US government debt is no longer enough to swallow it all.
4. The Federal Reserve is essentially printing money by loaning this imaginary money to the US.

This means that .6*.4*.4 = 9.6% of the GDP is pure inflationary money-printing. (Actually my memory says that the number is more than 12% but I don't know which of the above is incorrect. If 60% of spending is borrowed, rather than 40%, then that would be about right. I'm too lazy to go back and look up the numbers again.)

IOW, our economy is now being inflated at 12% per year (I'm going with the number I recollect). Be prepared to pay a LOT more for goods in the near future. (I would just add that minor items such as the cost of fuel and housing are not included in the Consumer Price Index, and a lot of other factors are fudged. So the CPI is basically imaginary, like the Unemployment numbers, which don't include anyone who has used up their unemployment benefits or just gave up looking.)

Re:Ironic

[artor3]

And how do you propose people do that? Most people these days are given 401k's as their only retirement option, in which they are forced to pick from a short list of thieves who to trust with their money. You can try to invest for yourself with an IRA, but they'll steal from you all the same with HFT. Or you could try to trust entirely in Social Security, but that's not really enough to live on in many areas, and odds are they will have privatized (i.e. stolen) all of it within 20 years anyway.

Re:Ironic

[Archangel Michael]

Of BOTH Parties, (D) and (R).

All you people out there that think the (R) or (D) party is better than the other are just as fooled as those you ridicule across the isle.

Re:Ironic

[StubNewellsFarm]

I'm not sure what you think inflation means, but it has nothing to do with whatever it is you think you're calculating. Also, the CPI absolutely does include housing and fuel - see http://www.bls.gov/cpi/cpifaq.htm#Question_7 I guess you're thinking of "core inflation" rather than CPI but, unfortunately for you, neither has increased by anything close to what your "theory" would predict.

Re:Ironic

[garyebickford]

Not yet. It will remain hidden for a while, but you can't print money at that rate and not have it show up in inflation. People and institutions are getting paid without producing anything. That is the definitive cause of inflation. I'm not saying it's new, just that we've entered a new phase where the second order effects are becoming significant - the rate must increase at a faster and faster rate to prevent collapse. This is the classic symptom of the inflationary spiral, starting to exceed the system's ability to damp itself.

There are lots of academic papers and popular articles and even books, showing the both the official 'core inflation' and CPI numbers are completely divorced from reality and have been for years. It's an ongoing topic of frustration and derision for many economists.

Just as a somewhat-related example (not rigorous, just indicative) showing the long term discrepancies, look at the average price of cars 1970 to today. In 1968 a Volkswagen Beetle was $1800 base price. Today the VW 'New Beetle' (essentially the same car) starts at $18995, ten times as much. (One can argue about features, but it's a reasonable comparison). That works out to about 8% inflation over the last 40 years. Knock of 25% of that for vaunted new capabilities, safety, whatever, that's 6%, still more than twice the official rate. The price of many goods has remained the same - I can buy jeans at Walmart today for about the same price as Levi's in 1970 - but that's a false example, as it depends on the _temporary_ distortion of wage scales around the world. When (not if) the worker in Thailand has the same standard of living as the US worker, those jeans will be well over $100 in the US.

Similarly, the cost of electronics has dropped precipitously - but that is the result of technical advancement, which (again Econ 101) is the _sole_ method of improving the standard of living in a modern economy.

Even more simply - the wages of carpenters and software engineers (for example) have both risen by a factor of 5 to 10, while the actual standard of living for people in those jobs has remained the same or dropped in that same period. Q.E.D. that is inflation - again closer to 8% than to the 2% or 3% promulgated by the government. For people in less skilled positions things are much more dire - and contrary to some politicians' propaganda and excuse making, this is not due to corporate raiders or evil capitalists - any more than sharks are the cause of tsunamis.

Re:Ironic

[TarouSatomi]

I'm not sure what you think inflation means, but it has nothing to do with whatever it is you think you're calculating. CPI blahblahblah...

Inflation can be measured both in terms of dollars in existence (which he is measuring) and in terms of prices, which the CPI purports to measure. Unfortunately for the American public, CPI is basically a wad of shit and doesn't measure anything meaningful these days. Amongst the absurdities: A) Geometric weighting is applied so that the items expanding in cost most rapidly are given less weight on the theory that people are likely to use less of those resources in future years B) Individual items that have gone up dramatically in price are dropped from the basket of goods via substitution. So if prime rib goes up 15% this year they will instead measure hot dogs. (This was part of how the Greeks got into the Eurozone - they flim-flammed the other continentals with dropping lemons from the CPI basket, etc) C) Pretty much everything they can dream up over at BLS will get hedonically adjusted. An entry level laptop that is $299.99 in year 1 and is $299.99 in year 2 will actually get reported as negative inflation because the new laptop will invariable have some new feature (or even bugfix!) that causes it to have more utility for the same cost. The BLS can say whatever it wants for the adjustment and there is NO PROOF because it is entirely opinion based as to whether or not the new feature set is worth $299.98 or $0.01

Re:Ironic

[NeutronCowboy]

Your numbers are wrong. For the most recent actual numbers, we can take the 2011 year.
See here for the budget: http://www.gpo.gov/fdsys/search/pagedetails.action?packageId=BUDGET-2011-BUD and here for the GDP numbers: https://www.cia.gov/library/publications/the-world-factbook/geos/us.html
3.8 Trillion of 15 Trillion (roughly) is 25%.
40% of the current spending is deficit spending, but no idea where you get the idea that 60% is just financed by printing money. You need some citations for that. Finally, about 9.8% of the US GDP is deficit spending. That is a scary number - but the alternatives are scarier. And as someone pointed out, your information on the CPI is flat-out wrong.

For some who is making grand plans to influence the future, you are remarkably uninformed.

Re:Ironic

[hibiki_r]

So we have an economy inflated at 12% per year, and yet cars don't cost 12% more every year, nor does clothing, or food, or pretty much anything you'd consider actual inflation.

Your calculations make me think you are one of those that think that a fixed money supply is the way to go. As it happens, it's the fact that the US money supply is actually growing that is making sure that the US isn't in the same hole as Southern Europe does: Countries where there's a whole lot of debt, yet monetary policy keeps inflation at bay like a vise. What you get then is tax increases and government cuts, which slow down the economy, which bring in even more increases, creating the death spiral that we see in Greece and Spain.

There has been more borrowing that can be repaid. That's pretty darned clear. So the question is, who pays the piper. If you do not touch the money supply at all, those that pay are those that borrowed... except for the part that they can't, so you get massive bankruptcies and a sinking economy. Our good friend the Money Illusion makes it extremely difficult to make salaries go down, which a contracting economy needs. If instead you have a more expansive monetary policy, then inflation both makes sure that money is invested instead of stashed in a mattress, which is good for the economy, and makes it far easier to lower salaries with respect to the entire economy, which is temporarily needed in recessions.

Hard money didn't solve jack squat for centuries. It wouldn't solve anything now either.

Re:Ironic

[CrimsonAvenger]

In 1968 a Volkswagen Beetle was $1800 base price. Today the VW 'New Beetle' (essentially the same car) starts at $18995, ten times as much. (One can argue about features, but it's a reasonable comparison). That works out to about 8% inflation over the last 40 years.

Actually, that only works out to ~5.8% inflation annually over the last 42 years.

Knock of 25% of that for vaunted new capabilities, safety, whatever, that's 6%, still more than twice the official rate.

25% for new capabilities would reduce the effective inflation rate to ~5.2%.

Re:Ironic

[nedlohs]

In 1968 a Volkswagen Beetle was $1800 base price. Today the VW 'New Beetle' (essentially the same car) starts at $18995, ten times as much. (One can argue about features, but it's a reasonable comparison). That works out to about 8% inflation over the last 40 years. Knock of 25% of that for vaunted new capabilities, safety, whatever, that's 6%, still more than twice the official rate.

The official rate is the inflation right now, not the inflation rate from some arbitrary year in the past until now. If you look at those official rates you'll see they were cosniderably higher than 6% around 1980.

1968 - 2012 is 44 years. 8% for 44 years would make that $1800 price be $53,000 now (you clearly used 6% for 40 years and didn't knock of 25%).

Even more simply - the wages of carpenters and software engineers (for example) have both risen by a factor of 5 to 10, while the actual standard of living for people in those jobs has remained the same or dropped in that same period. Q.E.D. that is inflation - again closer to 8% than to the 2% or 3% promulgated by the government.

You made up your 8% number. 1800 -> 18995 over 40 years is 6.1% inflation. Over the 44 years from 1968 to 2012 it's 5.5% inflation. Whereas offical numbers have the CPI inflation at 4.4% over the last 44 years.

Official numbers have have prices rising by a factor of 6.6 over that time period - oh look inside your "factor of 5 to 10" range for carpenters and software engineer wage increases.

Re:Ironic

[santiagoanders]

Fsck his dense?

One!

[50000BTU_barbecue]

billions! It's so much money even the singular takes an "s"!

Re:One!

[Samantha Wright]

But strangely—probably the first time I've ever seen a lawsuit in the news with a huge amount of money involved and was able to say "I understand exactly how they arrived at that amount, given the circumstances, and in no way do I find it unreasonable or astronomical."

Re:One!

[Zontar The Mindless]

Similar reaction here. I think I might actually have been astounded by the fact that I wasn't astounded, but I'm not sure.

Why civil?

[DoofusOfDeath]

Did Goldman Sachs employees engage in some kind of fraud?

I would give my two left lugnuts to see white-collar crime like this vigorously prosecuted.

Re:Why civil?

[shine]

Fraud is GS middle name. They will bet for you and bet against you out of both sides of their wallet.

Re:Why civil?

[DoofusOfDeath]

Yes, out of the tens of thousands of emoyees everyone is supposed to know what everyone is doing

And a few there found that l&h was a fraud before it blew up

If corporations are people, then they're responsible for the relationships between the different thoughts in their heads.

Re:Why civil?

[jhoegl]

I think the icing on the cake is the fee of 5 mil to point them to a known fraudster.
Talk about the ultimate troll move. That surpasses being Rick Rolled.

Re:Why civil?

[Anonymous Coward]

Maybe and maybe not. A more interesting question would seem to be were they negligent. If I pay someone $5m for investment advice and an introduction to a reputable financial institution I would assume that part of the reasoning is to mitigate the risk of selecting investment partners without being able to perform the due diligence yourself. If GS instead takes my $5m and then introduces me to a fraudulent company then I haven't off loaded my risk at all and it would seem to be the equivalent of consulting malpractice or negligence. I'm not sure fraud is the right term but they definitely didn't uphold their contract.

Re:Why civil?

[purpledinoz]

All big banks are engaged in fraud. Google "LIBOR scandal".

Re:Why civil?

[Farmer Tim]

If corporations are people, then they're responsible for the relationships between the different thoughts in their heads.

Couldn't they claim diminished responsibility due to multiple personality disorder?

Re:Why civil?

[DoofusOfDeath]

I think the icing on the cake is the fee of 5 mil to point them to a known fraudster.

Talk about the ultimate troll move. That surpasses being Rick Rolled.

I just figured out what their eternity in Hell is going to look like...

Re:Why civil?

[Smallpond]

Yes, out of the tens of thousands of emoyees everyone is supposed to know what everyone is doing

And a few there found that l&h was a fraud before it blew up

If corporations are people, then they're responsible for the relationships between the different thoughts in their heads.

When a corporation makes a huge profit, the top execs are always willing to accept reponsibilty and accept an obscene bonus. When the corporation does something bad, shouldn't they be responsible for that, too?

Re:Why civil?

[ShanghaiBill]

Did Goldman Sachs employees engage in some kind of fraud?

It is possible that they did. It all depends on what the contract says. If, in addition to finding a buyer, they also promised to do due diligence , and they gave a different conclusion from the one reached internally, then that could be considered fraud. Since GS was paid $5M, they certainly had the resources to be thorough, so "we forgot about that" probably won't be considered a valid excuse.

Re:Why civil?

[Anonymous Coward]

Yes, when a company agrees to take a large fee to advise on an M&A advisory, it's completely unreasonable to expect the people they put on the deal to do such challenging things like due diligence, which might include asking around if anyone knows about this company, or doing any research on their own.

Or if, as is apparently their stated position in this lawsuit, they believe that doing due diligence isn't part of their job, pointing out to their client that no due diligence has been done, and calling that a risk to the long-term value of the deal is apparently ALSO not their jobs.

Look - high finance is hard. People routinely make lots of bets with lots of money. Sometimes those bets go badly. And having good advisors isn't a magic bullet for avoiding a bad bet - sometimes the best info you have at the time is wrong, and only with the benefit of hindsight might you realize something might not turn out.

But there's a difference between "The best info we had was wrong" and "We didn't really bother getting any info." And also between "We advised you that we weren't going to research this, and you agreed to take on that risk" and "we gave you reason to believe we'd done enough homework that you should feel confident, even though we hadn't."

Re:Why civil?

[Jackie_Chan_Fan]

There is no hell.

The only way to torture these criminals is while they're alive. Get to it.

Re:Why civil?

[ynp7]

Isn't the burden of having all that money and the guilt over how it was acquired really punishment enough?

Re:Why civil?

[blind biker]

There is no hell.

The only way to torture these criminals is while they're alive. Get to it.

Indeed. The whole idea of "heaven" and "hell" was invented by the dominant classes, to keep the little guys at bay: "yeah, we're kinda rich now, and your life sucks monkeyballs, but one day ye shall inherit the earth, the eternal life in heaven awaits you, while we are at grave risk of going to hell".

Re:Why civil?

[gznork26]

Sure. Go ahead. Make corporations 100% people. Give them all of the rights they've been lusting after, and once they've grabbed that carrot, shut the door behind them and give them the responsibilities and the punishments as well. I fantasize about this sort of thing on my blog. This one launched a series: http://klurgsheld.wordpress.com/2007/08/30/short-story-logical-conclusion/

Re:Why civil?

[Grave]

Ahh, you should file a patent on that - the corporate insanity defense. It can get a company out of all sorts of legal troubles!

Re:Why civil?

[spire3661]

High finance is NOT hard. They purposefully obfuscate everything.

Re:Why civil?

[Smallpond]

For example, a bank should not be allowed to combine with another bank. Mergers should only take place between different types of financial institutions as God intended.

Re:Why civil?

[Anonymous Coward]

Insightful? Almost every purported author of the Bible was at the lowest strung of society, many having been martyred. Exceptions include David, Solomon and Moses. The first two have some not so flattering things written about them and Moses was leader of a bunch of desert dwellers.

Re:Why civil?

[gbjbaanb]

They will bet for you and bet against you out of both sides of your wallet.

fixed that for you

Re:Why civil?

[Sarten-X]

Except that it's not really relevant. Two years is a long time in high finance, and a screwup by a company's division on a different continent is a long way from calling the whole company a "known fraudster". Just because Goldman Sachs declined one particular investment deal (which, not seeing further details, I must assume to be a generic capital-campaign investment) does not mean Lernaut & Hauspie are suddenly banned from further investments, and especially not a purchase deal that's within their field.

Re:Why civil?

[hairyfeet]

And sadly its worked for thousands of years, see Jim Crow and how blacks would go to their little churches and be told that they'd get nicer things in heaven for being treated like shit here, hell you go throughout history and you see case after case of those at the top using religion to keep the peasants in line with threats of hell and promises of heaven. that is why i truly believe we won't get a better world until we put away such beliefs, because it is too easy to keep large numbers of the downtrodden in line with religion, the opiate of the masses.

Re:Why civil?

[CodeBuster]

the top execs are always willing to accept reponsibilty and accept an obscene bonus

Who decides what is and what is not obscene? Shouldn't that be the decision of the shareholders? If the shareholders vote for the bonus, the what business is it of those who aren't shareholders? If you want a say on pay at Goldman then buy some of their shares and vote them. If more of the occupy people did this instead of screaming in the streets and voted as a block, then perhaps something might actually change. Maybe they should each buy 20 shares of Goldman Sachs instead of that Mac Book Pro? A strong minority vote at the shareholder's meeting, binding or not, can provoke greater scrutiny and perhaps lead to bonuses more in line with long term performance of the company and the value thus created for shareholders who are in fact the owners of the business.

Re:Why civil?

[fahrbot-bot]

The people that want to use that statement to criticize Romney will ignore your explanation, and continue using the out-of-context quote to attack.

Well, since you mentioned Romney... As he said on CNN, which was quoted on The NY Times (and other places):

“I know there will always be calls for more. People always want to get more,” Mr. Romney said on CNN. “And, you know, we’re putting out what is required plus more that is not required. And those are the two years that people are going to have. And that’s — that’s all that’s necessary for people to understand something about my finances.”

Yes but "something" is not "everything" and I think the distinction is important in this case. We're not all wealthy enough to hide, I mean "shelter", our (personal and family) income and investments off shore. Most of don't know about owning, running and getting paid by a company, but not having any responsibility/accountability for it...or merely running companies that parent company owns.

Technically correct and legal is one thing, proper and ethical another. Romney likes to blur those lines a lot, like, apparently, most Wall Street people of late.

They don't _care_ if it's true, just whether it's effective.

Again, works for Romney and his friends. Simply put, Romney is a weasel. (Hmm... "Weasel in Chief" has a nice ring to it, don't you think?)

Re:Why civil?

[blind biker]

Insightful? Almost every purported author of the Bible was at the lowest strung of society, many having been martyred. Exceptions include David, Solomon and Moses. The first two have some not so flattering things written about them and Moses was leader of a bunch of desert dwellers.

Emphasis mine. In fact, spreading the notion that the founders of a religion were poor and martyrs play directly into the hands of those who use religion to dominate and subjugate.

Re:Why civil?

[dalosla]

I met the Bakers around 2002 at a neighborhood party and heard this story. At that time, Goldman's excuse was "L&H lied to us." However, given that a couple Wall Street Journal reporters exposed the fraud mostly by making some phone calls, it was clear that Goldman had done little work. I wish the Bakers the best of luck.

Re:Why civil?

[Anonymous Coward]

Religion is what keeps the poor from murdering the rich. ~ Napoleon Bonaparte

Re:Why civil?

[Man On Pink Corner]

The authors of the Bible -- most of whom, in the case of the New Testament, weren't even born yet at the time they decided to write about the miraculous events they described -- were never the people who mattered. As usual, the editors and publishers are the people who determine what you read, from this morning's Slashdot front page all the way back to the Bible.

Religious memes obey fitness functions, just like anything else subject to evolutionary pressure. If the ruling classes had not found Christianity so darned useful, the Bible would just be another one of a thousand forgotten religious texts, waiting to be discovered by scholars in a hole in the ground, reported at a conference attended by perhaps two hundred people, and described in a journal that perhaps five hundred professors and grad students would ever read.

Re:Why civil?

[Crosshair84]

Why do otherwise intelligent people continue to blather such nonsense? You're not going to convince anyone who has studied the question with that talk and now that the various Christian denominations are beefing up their apologetics programs in response to the New Atheists, many more young Christians are going to be equipped to deal with such "arguments".

Please, do show how Christianity "was invented by the dominant classes, to keep the little guys at bay". All you do by saying that is expose yourself as having done little to no study on the topic of philosophy and theology.

Please do explain Saul of Tarsus's conversion on the road to Damascus. Saul had nothing to gain and everything to lose by becoming a Christian. Please do explain the uncanny historical accuracy of the works of Luke, with details like the nicknames of local leaders, depth of local waters, local topography, and other tidbits that intersect with and have been confirmed by secular history and archeology. (The Book of Acts in the Setting of Hellenistic History) Please do explain how 11 of the 12 disciples, who personally KNEW if what they were saying was true or false, went to deaths with not one of the 12 recanting at any point. (This is different than a Muslim Jihadist, who simply believes that Islam is true, the disciples KNEW first hand if what they were preaching was true. They were there.)

To add on to that, who would make up a religion like Christianity? The disciples are frequently shown to be inept idiots, frequently not understanding Jesus's teachings before the crucifiction. Peter is rebuked and called Satan by Jesus himself. All the disciples deny Jesus and run away in his hour of need. Women, whose testimony was worthless in 1st century Jewish culture, are the ones who find the empty tomb. Even after this the disciples still doubt the resurrection. Jesus's own family does not believe him during his life and in one passage try to cart him away as being crazy.

All I typically get is explanations that have been rejected by scholarly critics of the new testament decades or even centuries ago. (Apparent death, hallucination, stealing the body, etc.)

If you want to see what made up scripture looks like, go read the Apocryphal Gospels, forgeries from the 2nd century AD.

Was Christianity abused at some points in history? Yes. Does that by itself mean it is false? No.

Atheism was abused and used to commit the largest cases of mass slaughter in history, does that by itself mean it is false? No.

What you need is philosophical argumentation and weigh it between the two worldviews.

Christianity claimed that the world was created a finite time ago, thanks to modern science we now know this happened around ~14.5 billion years ago.
Atheism, along with some eastern religions, claimed an eternal universe until that was contradicted by the evidence.

Christianity posits a first uncaused cause that prevents an infinite regress of causes. (Atheists who say "Who created God" simply show that they do not understand the question or the answer.)
Atheism has no plausible first cause, all ultimately end in an infinite regress, which cannot exist. (How many people here understand the problem of an infinite regress?)

Science flourished under Christianity and not elsewhere in the middle ages because Christian philosophy assumes an orderly, understandable universe. You cannot even start trying to do modern science without those presuppositions.
Atheist philosophy has no grounds for assuming an orderly/understandable universe. People like Dawkins reject it, and then do science that assumes it, not realizing the contradiction.

That's not to say Atheist philosophy hasn't been useless, it has posited many good questions that required serious consideration and answers. The main problem is that Atheists today continue to drum on questions that were answered decades, if not centuries ago. If they DO discuss an answer, they almost always either misun

Re:Why civil?

[smart_ass]

From the summary:

Goldman and Sachs itself had decided against investing in Lernout & Hauspie two years previous to this because they were lying about their Asian sales.

It's not that they didn't check or didn't advise that they didn't check.
They had evidence to suggest it was a bad idea (they would not invest with L&H) and did not disclose that.

It was all about getting the commission and nothing about ethics or doing right by their customer.

Re:Why civil?

[blind biker]

Who decides what is and what is not obscene? Shouldn't that be the decision of the shareholders?

It should, but it almost never is. Publicly traded corporations are woefully mismanaged exactly because there is no owner in direct control of what is really going on in such a company. The bonuses and salaries of top executives, including their awesome severance packages, is just such an example: these are decided by the board of directors (a bunch of corporate psychopaths connected with the CxOs) and the executives.

Mergers, acquisitions and firings of tens of thousands of employees are other such decisions that the shareholders have no actual influence on. You think there were no shareholders outraged at Stephen Elop's decision to kill both Symbian and Meego in one sweep and putting the fate of Nokia into Microsoft's hands? Ultimately, however, those shareholders could do jack, and now Nokia's marketshare AND share value are in the toilet.

Re:Why civil?

[artor3]

The shareholders don't get a vote.

Okay, technically, thanks to the recent financial reform, stockholders get a non-binding vote, but the execs can (an do) just ignore it and pay themselves whatever they want.

Furthermore, if you had any knowledge of how corporate votes work, you would never suggest something as moronic as democracy-through-share-purchasing. To get a significant portion of the vote, you'd need around 10 million people dropping $2000 each... except trying to buy 200M shares would send the price skyrocketing. So the people whose lives get toyed with by these companies need to pay the thieves hundreds of billions of dollars just to be able to vote on a non-binding resolution? I'd rather buy a torch and pitchfork.

Re:Why civil?

[riverat1]

Now if we could just lock them away in the looney bin.

Re:Why civil?

[Smallpond]

the top execs are always willing to accept reponsibilty and accept an obscene bonus

Who decides what is and what is not obscene? Shouldn't that be the decision of the shareholders? If the shareholders vote for the bonus, the what business is it of those who aren't shareholders? If you want a say on pay at Goldman then buy some of their shares and vote them. If more of the occupy people did this instead of screaming in the streets and voted as a block, then perhaps something might actually change. Maybe they should each buy 20 shares of Goldman Sachs instead of that Mac Book Pro? A strong minority vote at the shareholder's meeting, binding or not, can provoke greater scrutiny and perhaps lead to bonuses more in line with long term performance of the company and the value thus created for shareholders who are in fact the owners of the business.

Let's suppose a million people do what you say. That's 97.43 * 20 * 1M = $1.9B. That's 3.9%. So they all march into the shareholder meeting. Oh look, they can't . It's closed. Well how about voting on executive pay? Oh look, its not on the ballot and there's no way to put it on there. The board controls what goes on the ballot and they like things the way they are. I hate to break this to you, but companies are not democracies. And the big institutional shareholders don't care either. Why? Because GS isnt' taking their money and paying bonuses, they're taking it from schmoes who trust their money to crooked banks.

Re:Why civil?

[shutdown -p now]

We know pretty well that early Christian communes mostly consisted of poor people and led by the same - it's not just speculation.

Yes, Christianity was largely imagined the way you describe under Constantine when it became the state religion of the empire, but it certainly didn't begin as "religion for the poor by the rich".

Fixed link

[Anonymous Coward]

Goldman Sachs and the $580 Million Black Hole

Two lessons here

[Anonymous Coward]

Lesson 1: Just because you paid someone 5 million dollars doesn't mean they have your best interests at heart.
Lesson 2: If a deal involves putting all your eggs in one basket, you should assume that the basket is faulty, and that everyone knows it but you.

Re:Two lessons here

[girlintraining]

Lesson 2: If a deal involves putting all your eggs in one basket, you should assume that the basket is faulty, and that everyone knows it but you.

Lesson 3: If you're a first time entrepreneur, and you've managed to become successful and now want to maintain that by going to reputable industry leaders for advice and support, you're gonna get raped. They don't want more successful people; it cuts into the profit margin of those who already are.

Re:Two lessons here

[gr8_phk]

Lesson 4: Cash is king. That paper shit they pass around on wall street has nebulous value. If someone wants to give you millions of dollars for your company, let them give you millions of actual dollars.

OTOH, from the short summary it sounds like they may have a case.

Re:Two lessons here

[cpu6502]

>>> That paper shit they pass around on wall street has nebulous value. If someone wants to give you millions of dollars for your company, let them give you millions of actual dollars.

Irony.
Dollars are paper too. In fact the paper dollar has lost 97% of its value since the creation of the Federal Reserve in 1913... most of it just since 1972. Contrast that with the 1800s when the paper dollar lost just 2% of its value (because it was tied to gold & silver... real goods that can't be run off a printing press.)

Re:Two lessons here

[pitchpipe]

If you're a first time entrepreneur ... you're gonna get raped.

By someone named Gold Man-Sacs no less!

Let's see, names for our new "financial business":

1. Dewey, Cheatham & Howe - Already taken
2. Skrewar, Widdow & Childe - Nice ring, but nah
3. Roper, Bender & Raper - Too obvious
4. Gold Man-Sacs - By Jove old chap, brilliant!

Re:Two lessons here

[Aighearach]

Dollars are paper, but their value is not nebulous. If Company A that you know nothing about gives you $10, it has the same value as if Company B gives you $10. Now, if they each give you "$10 worth" of their stock, that value is nebulous.

If you still don't understand, simply work out for yourself, if they had been paid in dollars where they be now and would we be reading about this lawsuit?

Re:Two lessons here

[sconeu]

You forgot my favorite:
Takeda, Monet, and Runne

Re:Two lessons here

[jpapon]

Man, you gold-standard people piss me off.

If you want gold so badly, just buy goddamn gold already, and stop bothering the rest of us who understand that there is way too much money circulating (or way too little gold) to move away from fiat money. There's absolutely no reason to back things with gold. If you're so set on a fixed amount of currency, just argue for a fixed amount of currency. There's no need to get some metal involved who's only real values are 1. Shiny and 2. Doesn't corrode.

Re:Two lessons here

[dotancohen]

There's no need to get some metal involved who's only real values are 1. Shiny and 2. Doesn't corrode.

Gold, despite its single valence electron, does not reflect all wavelengths of visible light due to the relativistic effects of that electron's huge (i.e.: fast) orbit. Hence, special shiny, not silver-like shiny.

Gold, despite its single valence electron, does not react well with other chemicals due to the relativistic effects of that electron's huge (i.e.: fast) orbit. Hence, does not corrode.

Therefore, gold's real value is based on relativity. Relativity was concocted by a Jew, who was even a candidate for the presidency of Israel. Therefore, the root of all evil is the Jews and Israel!

(Politically-correct mods: look at my username before deciding that I'm an antisemetic troll)

Re:Two lessons here

[jpapon]

Gold is a fixed supply. They can't just suddenly create 1 trillion gold bars out of thin air (as they routinely do with paper). Number 3 is the key reason why it's a superior way to store wealth.

Gold is not a fixed supply by any means. It can be both "destroyed" and "created" (in fact the current rate of production is 2750 metric tons per annum, more than double what it was in 1980). What happens to your gold economy if they discover 30000 tons of easily mined gold in Antarctica, or the Canadian wilderness? Why tie the value of your money to something you have absolutely no control over (gold production), when you can tie it to something you CAN (in theory) control - the Fed ??

I'm fine with you arguing against the fed devaluing the dollar. Thing is, there's absolutely no reason to bring gold into the discussion. Simply have the Fed stop increasing the money supply, or have it increase at a fixed rate (maybe based on population growth or something). I'm not sure if doing that would be a good thing, but that's the discussion people should be having. Gold has nothing to do with it, and just distracts people from the real issues.

Power to them

[B33RM17]

More power to them. I don't know much in the area of finance and the like, but stories like this continue to give me the impression large financial institutions like to play fast and loose with other people's (read: little guy's) money. Too big to fail? More like too big to be allowed continued operation.

Re:Power to them

[Tough Love]

Goldman Sachs is well known for selling investment vehicles that they themselves would not touch with a ten foot pole because of their inside knowledge.

They are the good guys

[Anonymous Coward]

IN BIZARRO WORLD

Re:They are the good guys

[alphatel]

IN BIZARRO WORLD

Mr. Berzofsky ... was asked one more time — the fact that the Bakers and Dragon’s shareholders lost everything doesn’t affect your opinion?
“Correct,” Mr. Berzofsky responded. “We guided them to a completed transaction.”

Bizarro World in full force

Re:They are the good guys

[Anonymous Coward]

There's an "Ethical Wall" between the consulting and investing arms. You'll hear complaining on every transaction, 50% of the time it's too high, 50% of the time it's too low. The consultants shouldn't know what the investors are trading on, and the traders shouldn't know what the consultants are advising on. As bad as it looks, this is how this should have happened, from GS's perspective.

Re:They are the good guys

[Skinkie]

And this is was these guys do. "Guide their client to a completed transaction." And each following transaction and so on, your are a new client being guided through the transaction. This made me wonder about the 5 million for consultancy from GS, given that would imply something like financial council. As counsel one would expect to share the reasons why GS did not do anything with L&H theirselves. I agree with the Bakers, on the unethical part of the banking business, its difficult to explain to offer the same 'independent' services to three (not two!) competitors.

Re:They are the good guys

[Dahamma]

Is that the same "ethical wall" the investment banks were supposed to use when bidding in the LIBOR scandal?

There are plenty of rules prohibiting many ethical and criminal violations in the banking industry. Of course, we're finding out more and more that the banks are more in the "rules are made to be broken" mentality these days (and probably all days)...

Re:They are the good guys

[lennier]

"We guided them to a completed transaction."

As the lion said of the zebra.

Re:They are the good guys

[Dahamma]

Either be outraged about the wall, or outraged about the lack of a wall.

Except it's not that simple. There was a "wall" in both cases. The outrage is when the banks ignore it to profit in one case, and try to use it to defend themselves from lawsuits in another.

And if you RTFA, the lawsuit is not really about this, anyway. It's about negligence to do any due diligence by the bankers handling the deal, not whether they shared information among departments. Again if you RTFA, both GS investment bankers and the Wall Street Journal were able to trivially find evidence of massive lies about the customer base, which is a pretty strong case due diligence was not performed. So, no, this is NOT "how this should have happened, from GS's perspective", unless their perspective was to take the customer's money and not actually do their job...

Re:They are the good guys

[UnknownSoldier]

The corruption is far, far greater ...

http://en.wikipedia.org/wiki/Brad_Birkenfeld

In October 2001, Birkenfeld began working at UBS in Geneva, Switzerland, handling private banking, primarily for clients located in the United States. In 2005, he learned that UBS's secret dealings with American customers violated an agreement the bank had reached with the IRS.

He resigned from UBS in October 2005 and provided written whistleblower complaints to Peter Kurer, Head Counsel for UBS, and other UBS senior executives regarding the illegal practices of U.S. cross-border business.

He is the first person to expose what has become a multi-billion dollar international tax fraud scandal over Swiss private banking. Despite his unprecedented, extensive and voluntary cooperation, and registering as an IRS whistleblower, Birkenfeld is the only U.S. citizen to be sentenced to jail as a result of the scandal.

Crooks

[Anonymous Coward]

Imagine that, Goldman Sachs involved in swindling people.

Will wonders never cease.

One can only hope they win but...

[divisionbyzero]

inevitably Goldman will weasel its way out of it.

Re:One can only hope they win but...

[rudy_wayne]

From TFA:

But on Feb. 29, Dragon received an odd memo from Goldman. It wasn’t addressed to anyone in particular at Dragon, and it wasn’t signed by anyone at Goldman. The Goldman employees testified later that they had no idea who had sent it. But the memo referred to many of the same due diligence issues that Ms. Chamberlain raised. The memo asserted, however, that Dragon’s accounting firm, Arthur Andersen, should do the work, not Goldman.

Well then what the fuck was Goldman getting paid $5 Million for?

And one of the defenses now being used by Goldman is that letter. Goldman is now claiming they are not liable for anything because they told Dragon it was their accountants responsibility to perform due diligence.

Sad

[Deepmist]

I read this story when it was published, the the guy that owned the company and lost his technology on top of all that money had a phd and was making huge advancements in the technology much faster than predicted, he's probably the reason Siri can exist. The saddest part is that he still had many improvements he was working on and now he just can't, the tech has been sold, he can't touch it anymore without getting sued. In the end humanity loses.

Re:Sad

[kolbe]

Back in 1997-99, my colocation space at Level 3 was right next to Dragon Systems' cabinets. As such, I was able to chat with their IT team on several occasions and met the Bakers on at least one occurrence where we discussed the futures of digital speech recognition (Dragon 2000 was being developed for Win2k at the time). Their insights and knowledge of speech recognition were unmatched by anyone else in the industry, not even IBM (who was working on it at the time too) was as advanced and I have no doubt that we would not have Siri or other similar technologies today if not for the Baker's research from in and out of Carnegie Mellon University.

The Baker bunch are not stupid people, they made a remarkable company last for almost 30 years, but it is obvious that they made a big mistake by putting everything in one "basket" as others here have stated. While I wish them luck, white collar crimes such as these are rarely won.

Re:Sad

[geoskd]

I know for a fact that their stuff is running inside of Siri -- because a hugely lucrative thing, and got snapped up for pennies. They sold out too soon, regardless of the terms.

Actually, they sold at just about the right time, Half a bil is not an untidy sum for the product they had at the time. They just got swindled by GS. plain and simple. GS should never have set them up to do business with a company that GS themselves had refused to do business two years prior. GS was paid to do the due diligence, as that is their field of expertise. Their failure to do the research and / or to present it to Dragon is why they are being sued, and why they should have to cough up the money. Specifically, I think they should take it out of the bonus' of every executive who worked at GS at that time, as a percentage of the whole. Make those bastards sell one of their yachts.

-=Geoskd

Re:Sad

[mc6809e]

Actually, they sold at just about the right time, Half a bil is not an untidy sum for the product they had at the time. They just got swindled by GS.

I'm not sure GS swindled them, but I'm sure GS didn't give a damn. Same thing happened in the mortgage industry: GS didn't fill-in mortgage applications with false information, but they sure didn't mind legally profiting from the sh!tstorm that followed -- not their problem.

At least someone at Lernout & Hauspie Speech Products went to prison.

Re:Sad

[kolbe]

While SRI International, through the help of defense-sponsored research funding I might add, did indeed create what we call SIRI at Menlo Park, it was NOT without foundations from countless years of already done research by companies such as Dragon International, IBM and CMU Research. The creators of Dragon Naturally Speaking had far more to do with SIRI than you seem to want to acknowledge:

http://news.cnet.com/8301-27076_3-20061241-248.html

Give credit to them where it is due.

I don't get it

[decadentdepraved]

I don't like GS (have had multiple experiences). But I'm still skeptical. Something seems off here. Given lack of good counsel, why did the Bakers go out on a limb, change course, and agree to an all-stock sale at the last minute? Why not walk away, or hire better advisors to get you what you need, and challenge GS fees in parallel? $580 mil was at stake. $5 mil is 1% of the pie. Seems like the only reason to sell is to get liquid. Why go to all that trouble just to swap shares of one stock for even higher risk and reward?

What I wondered is..

[biodata]

Who owns Scansoft, who apart from GS are the other big winners from this transaction? They got the world's best speech rec software for a fraction of its true value - I wonder who they were advised by?

Re:What I wondered is..

[Theaetetus]

Who owns Scansoft, who apart from GS are the other big winners from this transaction? They got the world's best speech rec software for a fraction of its true value - I wonder who they were advised by?

A mysterious company called Soldman Gachs, who have since gone out of business after a fire that destroyed all of their files.

Wellllllll

[Anonymous Coward]

"After consultations with Goldman Sachs,..."

That's your problem right there.

I'm posting from my smart phone

[circletimessquare]

And using the dictation option. But I can't create a post because every time I say g---m-- s----, all I see are a bunch of expletives in the comment box

Non-Paywalled version

[rudy_wayne]

http://www.nytimes.com/2012/07/15/business/goldman-sachs-and-a-sale-gone-horribly-awry.html?pagewanted=1&_r=2&hpw

Trading is not stealing

[F69631]

I lean left on local standards (those of European social democracy) so I'd probably be something like "extreme left" on American standards (if we consider Democrats a left-wing party). I have no love for either Goldman Sachs or the whole sector they operate in... that said, you can hardly call what they did "stealing".

Are they unethical? Sure. Have they broken some laws by deceiving regulators? Probably. Misleading advertising? Might be. Fraud? Depends on the contracts they've used... but stealing? No. They've simply not cared about the fate of their clients - or the society - except where they had the economic incentive to do so. That kind of stuff happens when you have free markets.

For any given amount of freedom in the markets, you get some good and some bad sides. You thus choose a level where the good sides outweigh the bad ones... and acknowledge that the decision also leads to some undesired results. What doesn't work is choosing one level, at first ignoring undesired results and then, when they become too apparent, call them stealing, etc. without making an argument for choosing another level of freedom in general.

Re:Trading is not stealing

[cpu6502]

They stole money from the taxpayer's treasury. To the tune of $100 per U.S. home.

Re:Trading is not stealing

[dark12222000]

Actually, per US law, they have stolen money. They intentionally lead their client who was acting in good faith into a business deal which Goldman-Sachs could reasonably believe would go very badly, and without warning them - and they accepted money for this.

That *does* count as theft in the US.

Re:Trading is not stealing

[Aighearach]

Under American law fraud and theft are different. You describe fraud, and perhaps conspiracy, not theft.

Re:Trading is not stealing

[Runaway1956]

Perhaps you've not been paying attention in class.

Goldman Sachs employs former government officials, both elected and appointed.

The government has a large number of officials who are former Goldman Sachs employees.

If you're not familiar with the concept, I'll offer you the term, "Revolving Door", which has often been used regarding government officials bouncing between jobs in the "defense industries".

It's impossible to completely separate Goldman Sachs from government, just as it's impossible to completely separate the defense industries from government.

Re:Trading is not stealing

[Runaway1956]

Fraud is nothing more than a type of theft which involves no violence. Con jobs are thefts.

Re:Trading is not stealing

[Aighearach]

Fraud is nothing more than a type of theft which involves no violence. Con jobs are thefts.

A con job where the goods are never delivered is theft. If the goods are delivered but are not what was represented, or there is otherwise some trick involved, then it is simply not theft.

I'm not sure why there is this strong desire to attach the word "theft" to fraud, fraud is already as bad as theft. What is gained by inaccuracy?

Re:Trading is not stealing

[Runaway1956]

http://www.wisegeek.com/what-is-theft-by-deception.htm

Fraud, theft by deception, con, whatever term one chooses to apply, the end result is the same. I'm promised something, which I don't ever get, in exchange for my payment or investment. And, it's theft, just as surely as a burglar commits theft when he removes property from my home.

This parsing of words, in an attempt to hide the fact that theft is indeed theft, only benefits those dishonest individuals who are committing the thefts. White collar thieves want to be distanced from common thieves, so they have created an entire vocabulary for thievery. Some words are applied to common criminals who are to stupid to steal millions. Other words apply to the smarter criminals who have the means to steal millions, or even billions.

Re:Trading is not stealing

[Trailer Trash]

That kind of stuff happens when you have free markets.

When you have "free markets" Goldman Sachs doesn't get bailed out. You can't have it both ways - blame the free market when cronyism is the real culprit.

Re:Trading is not stealing

[mug funky]

you assume that if the Bakers knew the financial sector well enough, they would not have gone to GS. no shit, sherlock. they would not have needed financial advice in the first place.

fucking Randroids. GTFO my planet.

I was working for an L&H competitor at the tim

[rogerz]

... and everyone in the industry knew that they were full of shit with their finances. The two founders - Lernout and Hauspie - were accountants, not technologists. The company had significant investment from the Belgian government, and L&H were politically well-connected enough to keep milking that funding source as they rode the tech frenzy of the 90's. In every instance where we competed against them, they always bid at ridiculously low prices that couldn't possibly be economically sensible. They had some decent technology, but their business practices were always suspect. It was very likely the taxpayer financing which kept their bubble from bursting before it did.

To be fair, Dragon was primarily involved in desktop ASR, whereas L&H (and my company - Voice Control Systems), were focusing on telephony applications. So, the Bakers may not have been fully acquainted with L&H's reputation. But, really, they should have been extremely suspicious of this deal, especially when the offer was changed to 100% stock. TFA didn't say what the value of some of the competing offers were, but I'm guessing they were substantially less than $580M. If it sounds too good to be true ....

None of this is to excuse Goldman, which apparently was hired to do something that they did not do. And clearly, the Bakers were done an injustice. But, something tells me that they were willfully blind to the possibility that this offer was unjustified. And for that, they should blame themselves.

Re:At least....

[geoskd]

....we have the comfort of knowing Goldman Sachs is still less evil than Electronic Arts.

You're dead wrong, EA only really screws its employees, goldman sachs will screw anyone who gets close enough, which unfortunately happens to include everyone with a stake in the world economy. Every unemployed person on earth currently owes a partial debt of gratitude for their state of employment to goldman sachs.

-=Geoskd

there is no wall at goldman sachs

[decora]

you can read countless articles about Goldman trades within the past 10 years, since they became a public company especially, and find numerous examples of where Goldman 'analysts' or 'consultants' were wishy washy with the 'trading' folks , either their own or others.

just becasue finance schools teach 'chinese walls' and they talk about it in presentations doesnt mean it actually happens.

Re:there is no wall at goldman sachs

[lennier]

examples of where Goldman 'analysts' or 'consultants' were wishy washy with the 'trading' folks

I don't think that word means what you think it means, if you think it means "friendly with".

wishy-washy

adj Informal
1. lacking in substance, force, colour, etc.
2. watery; thin

Adj. 1. wishy-washy - weak in willpower, courage or vitality
namby-pamby, spineless, gutless
weak - wanting in physical strength; "a weak pillar"

Re:there is no wall at goldman sachs

[Dun Malg]

I do believe the phrase he was looking for is "palsy walsy"

Re:there is no wall at goldman sachs

[kennykb]

Whether it was wishy-washy or palsy-walsy, the point is that there was hanky-panky going on.

Re:there is no wall at goldman sachs

[haruchai]

More like Hanky-Paulsy

No bailout for the Bakers', I guess.

so what exactly is 'stealing', im sorry

[decora]

im a little confused as to what you would actually consider 'stealing'.

my favorite definition is from Jennifer Aniston's character in Office Space.

you take something thats not yours. and then it becomes yours.

just because its from firedoglake

[decora]

doesnt mean that its factually incorrect. Goldman Sachs has a huge influence in the white house and in congress, and anyone who studies the history of the early 21st century will have to study Goldman Sachs.

One sentence.

[siddesu]

If you have a good business that generates revenues, it is better to rely on it, rather than hope that 419 scams and "get rich quick" schemes will work for you.

The differences between GS and that Nigerian scammer are the better writing talent and the better government protection that one of them is using.

Re:I was working for an L&H competitor at the

[Anonymous Coward]

Siri doesn't do its voice recognition on the cellphone. It farms that out to machines in a datacenter somewhere.

Re:L&H at fault, not GS

[Anonymous Coward]

Even if the 4 junior guys assigned to Dragon didn't know about the previous Goldman analysis of L&H (and they probably didn't), someone up top certainly did. Their work should have been looked over by a supervisor and/or others up top at Goldman. And those people should have known.

Also, the Wall Street Journal reporters calling the L&H "customers" proved that even cursory due diligence here would have proved that L&H were fraud.

And it's way too convenient that Goldman was representing a competitor (Nuance) at the same time.

Goldman was negligent and possibly also double-dealing.

Goldman's only hope here is to get out on a standing issue. If Goldman actually has to go to trial on this, they're screwed. A jury will crucify them. And rightfully so.

My wild guess? This settles before trial for a couple hundred million.

More details from earlier on & why FOSS is goo

[Paul Fernhout]

http://www.wired.com/wired/archive/11.02/code_pr.html

As that older article points out, the Bakers also spent some time early on at IBM Research doing speech stuff (and from when I was working at the IBM Speech group myself much later, it did not seem completely clear what way most of the knowledge was flowing). My undergrad adviser at Princeton, George A. Miller, who did a lot in the psychology of natural language and knew the Bakers (I think from when he was at Rockefeller with them), told me about this loss more than a decade ago, as a cautionary tale. More than the money, what really hurt most for the couple was not being able to work on their project anymore. For anyone who really cares about what they are working on, this is a good argument for working in the free and open source software realm rather than trying to finance proprietary software somehow, even when you think you are the "owner" of the software. Imagine if the Bakers had released Dragon as FOSS back then and built a consultancy around it -- at least they would not be alienated from their 20+ year labor of love (or "third child" as they called the software). In general, you also can't expect the same people who put their love into creating great things for the world to be fully prepared to deal with business sharks (even business sharks like GS being supposedly hired to "help" them). I'm glad my wife and I released our own labors of love (like our Garden Simulator and PlantStudio software) as FOSS instead of taking on investors and making it proprietary, since at least we can always still work with the source code. Of course, the flip side of that is often not having the time to do that because of a need to do other things for money. We ideally need a "basic income" and similar social changes to solve that problem and to minimize a software industry based around "artificial scarcity".
http://www.basicincome.org/bien/
http://www.artificialscarcity.com/

Their mistake

[Anonymous Coward]

Was trading their company for stock in another company. That was monumentally stupid.

I've spun up and sold a handful of companies now and not once did I accept stock in the purchasing company. When I exit, I EXIT, as in, that's it. The only reason I start a company is to sell it for a ton more cash than it took me to start and build it. I can then use a small percentage of that cash to start another one.

When you swap stock, you're trading something you know everything about (your stock) for something you don't know ANYTHING about (their stock). You don't know how they're cooking the books, or lying on their SEC forms, or laundering assets away, or playing other ENRON games. Certainly they could take the same tack about you, but then, you're the one with something they want, so they should be the ones to take the risk.

I have no problem holding onto a company that is making me money, if someone doesn't want to buy. If they have doubts about the way I do things, that's fine. I'll just keep making money until some other buyer comes along.

The ONLY time someone is in a hurry to sell is when they're losing money, and the company's days are numbered (like, in this example, the purchasing company who wanted to trade their crappy losing stock for some good, profitable stock). I can wait.

Re:what do you think dollars are?

[cowboy76Spain]

You are right. Last time I was offered millions of dollars, I asked them to pay me in camels. Way safer!

Gaston Bastiens Anyone?

[Spleeflarp]

There is a common denominator that has been overlooked here... Gaston Bastiens. For those of you who go back far enough, you may remember a couple of companies known as Quarterdeck and Datastorm Technologies. Gaston Bastiens took the helm of Quarterdeck and went on a buying spree that included slurping up privately held Datastorm Technologies. Like his tenure at L&H, this period was known for cooking the books and leaving the original folks hosed. It was a glorious day when those of us who used to work at Datastorm saw Gaston being led away in chains... http://www.flickr.com/photos/markdionne/294806554/ We weren't the least bit surprised that he had done it again... we were just pleased that he got prosecuted this time.

Re:Not stealing if I agree to give you the item

[JBMcB]

There are very specific rules regarding investing. If you are acting as an economic adviser to another entity, there is all sorts of legal language attached to that transaction that is supposed to insure that you are acting in the best interests of your client. It's similar to acting on behalf of someone else as their legal representative (in other words, lawyer)

If someone hires you as an adviser for their investments, and you tell them to invest in something that you know is dodgy, then you are in hot water. At the very least, there is the concept of due diligence, where you are supposed to do a through analysis of the investment before recommending it. It appears as though Goldman had done their due diligence before and decided against investing in L&H, which means they are in trouble if they then recommend someone else make a similar investment.

Re:Microsoft Agent

[FreelanceWizard]

I actually wrote a fair amount of UI code interfacing with Microsoft Agent as part of a research project, AutoTutor. While the L&H TTS engines were indeed the default for Agent, that's just because they were the default ones installed on Windows (2000 and XP) at the time. Agent allows you to load the TTS engine of your choice, so long as it supports the Speech API. Because the Speech API includes callbacks for phonemes spoken, Agent can synchronize lip movements of the character to what's being spoken by the speech engine regardless of its creator.

Ultimately, the poor quality of the L&H voices led us to SpeechWorks and AT&T's NaturalVoice products. Sadly, both the TTS and voice recognition fields went through major consolidations in the early 2000s, and now SpeechWorks is dead (acquired by Nuance). NaturalVoice is still available, more or less, from Wizzard Software.

It's unfortunate !

[Taco Cowboy]

It's very unfortunate that most of us geeks are not that well versed in financial thingy, and that we geeks are too trusting of others - methinks this maybe the result of we geeks, in our own geeky-universe, are generally trustworthy

Unfortunately, the world out there is filled with critters that will cheat everybody, even their own mothers !

The two inventors of Dragon Speech Recognizing System put their trusts in Goldman Sachs, which, by now, most of us geeks should know not to trust

It is even more unfortunately that the two inventors now have to rely on lawyers to sue Goldman Sachs - and lawyers are critters that are not that far removed from the kind of critters that occupies the Capital Hill / White House / Wall Street

Methinks the only way we geeks can survive the world out there is to turn ourselves into the baddest kind of critters - even more badder than the critters of Wall Street, critters in the Capital Hill and/or the White House
 

Re:It's unfortunate !

[garyebickford]

Methinks the only way we geeks can survive the world out there is to turn ourselves into the baddest kind of critters - even more badder than the critters of Wall Street, critters in the Capital Hill and/or the White House

I think that's a) impossible, as it requires a denial of what makes one a geek; b) destructive, as it requires one to become what one hates. I have a relative, who always talks about how much more successful she might have been if she had become a lying, thieving charlatan like some of those she's dealt with in the past, and made her life more difficult. But that would have required her to become someone she isn't, and wouldn't have wanted to be.

I would just say the following: I never read Nietzche, but from my understanding Nietzche asserted that there were two types of people, masters and slaves. Masters (at least as far as those who adopted and distorted the ideas of Nietzche and Weber after WWI, to a great extent leading to WWII) were basically what we would now call sociopaths or psychopaths - capable of lying, cheating, enslaving and murder to achieve the ideal world. Slaves, in their view, were the other 90% of the world.

And, in at least one sense this was and is true. A few people (at much higher percentages in higher leadership positions, according to recent research) are that type of 'master', and many, many people - probably the great majority IMHO - just want to not think, not worry, just do what they are told and watch sports on TV. (Yes, I'm generalizing).

But IMHO there is a third group, that Nietzche never talked about to my (poor) knowledge - I'll call them creatives. These are the explorers, the artists, the engineers, the 'geeks' of all stripes - and about 1/2 of the entrpreneurs. The creatives don't want to be masters, and refuse to be slaves. They will always be the disruptors, will never be accepted by either of the other groups, and will always be a thorn in the side to the 'system'. And I will assert that they are the ones that largely prevent the 'masters' from taking over completely - as long as information and movement are free, and the system can continue to expand. (Thus my promotion of commercial space development - the ultimate 'free frontier', that never ends. Not to digress TOO far.)

Re:It's unfortunate !

[million_monkeys]

The way for geeks to survive is to ally themselves with people much badder than lawyers or politicians: professional assassins. For all the power that a lawyer or politician has, they're nearly powerless against a professional assassin. Only the highest-ranking officials get security details, most politicians don't, and I don't think I've ever heard of a lawyer with a bodyguard.

I don't know if this is a joke or not, but the underlying idea is that there are some people who can get away with being scumbags. Many of them happen to also have the ability to screw over large numbers of other people for personal gain without any real consequences. That's a bad combination. I wouldn't encourage anyone to follow the OP's advice, but it has always surprised me that there aren't more people getting shot for the crap they pull.

Re:It's unfortunate !

[flappinbooger]

In my experience from being around the technologically astute, the problem solvers, the artistic, the inherently naturally talented people I would have to agree.

The issue is that many of those types of people aren't "type A" personalities. They aren't cut-throat leaders and the corporate project manager types. They will create masterpieces, they will design complex and game-changing inventions and they will fix things no-one else understands. But they do it at the behest of someone else who is paying the money or running the project.

They are in their place when they are creating and doing. Their talents would be wasted running the show. Obviously when pressed into service they can, will and do lead - brilliantly, but they don't seek it out.

When these talented people are busy seeing the big picture in order to lead they don't have the time to focus in on the minutia they are so good at seeing. When they are in "the zone" they can't be bothered to see the big picture, it is just a distraction at the time.

There are few people who are both brilliantly creative AND also type A. I know of one who made his mark, Steve Jobs.

Re:It's unfortunate !

[bryan1945]

One easy solution is to demand cash, not stocks. Or mostly cash, and some stocks. I never heard of anyone going bankrupt from accepting cash (what happens afterwards, well...). Trusting someone to make you money based on a promise... not so much.

Re:It's unfortunate !

[Stormthirst]

They should have looked at what Goldman-Sachs were doing with their own money. The fact that GS didn't invest in L&H is telling.

Re:It's unfortunate !

[yoshi_mon]

I'll just add too these two great posts one other point.

The sociopaths/masters will always seek to setup (and or subvert if the system is in place to hold them in check) a system that will self reenforce their own positions. AND their own egos.

By which I mean not only their power structure, control of resources (money)/control of power (politics)/control of information (media), will be at their command. But that they will feel entitled to that control. That they deserve to be in control and if they were not the would would burn.

Re:It's unfortunate !

[Remus Shepherd]

Or to put it another way, if I may quote the Church of the Sub-Genius:

"There are three kinds of people -- I call them Larrys, Curlys, and Moes. The Larrys don't even know that there are three types; if they're told, it's an abstraction, because they cannot imagine anything beyond Larry-ness. The Curlys know about it, and recognize the pecking order, but find ways of living with it cheerfully...for they are the imaginative, creative ones. The Moes not only know about it, but exploit and perpetuate it.

The naive, pleasant believers of all kinds are Larrys -- ineffectual, well-meaning do-gooders destined always to be victims, often without once guessing their status. Like sheep, they don't want to hear the unpleasant legends about "the slaughterhouse"; they /trust/ the strange two-legged beings who feed them. The artists, unsung scientific geniuses, political writers, and earnest disciples of the stranger cults are Curlys -- engaging, original, accident-prone but full of life, intuitively aware of the Moe forces plotting against them and trying to fight back. They can never defeat the Moes, however, without BECOMING Moes, which is impossible for a true Curly.

The Moes, then, are the fanatics, the ranters, the cult gurus, the Uri Gellers AND the Debunkers; they are the Resistance Leaders and the Ruling Class Bankers. They hate each other, but only because they want to control ALL the Larrys and Curlys themselves....Larrys and Curlys die in wars started by
rival Moes -- the Larrys willingly, the Curlys with great regret."

I never realized how much the Church of the Sub-Genius shares with Nietzche. Thanks, that's an insight that will leave me shaking in bed with nightmares someday. :)

Karma

[Andy Smith]

It seems there is some karma in effect here.
http://www.planetcrap.com/topics/8/

Re:You don't go too far enough!

[Grishnakh]

The only problem with shooting them is that their personal money is probably safely tucked into offshore bank accounts. Threatening to torture their soon-to-be-orphan children to death should get them to relinquish those account numbers however.

Fiduciary duty

[JDG1980]

The legal argument here will almost certainly be that, by accepting $5 million from the Bakers for consulting fees, Goldman Sachs had a fiduciary duty to act in their best interest regarding the transaction.

You can argue that they should have known better than to "put all their eggs in one basket". But the fact that the client should have known better is not a legal defense to a breach of a fiduciary duty. That's why you're paying the professional in the first place – because they're supposed to know better than you! They have a legal obligation to use that knowledge in your interests, not double-dip on the side.

The fact that Goldman considered investing in L&H and then specifically declined to do so is strong evidence that this recommendation to the Bakers was in violation of their legal duties.

Relying on Goldman Sachs for financial advice...

[Beeftopia]

... is like the chickens relying on the fox to provide henhouse security.

5 million clams?

[chrismcb]

The paid 5 millions dollars? And their advice was to sell their company to a sinking ship (either a ship Goldman knew was sinking, or with a tiny amount of work could have figured it out)
And their defense is "We completed the transaction." That is like saying "Yeah we sold your stuff to the con artist. We knew he was a con artist, and he paid in fake cash, here you go. We did our part"
I think sueing for 1 billion isn't enough. And good luck to the Bakers, from the story it seems they deserve to win.

Re:I was working for an L&H competitor at the

[rogerz]

It is painfully evident to anyone who has used Dragon software that they are not technologists.

I was referring to Lernout and Hauspie - the founders of that company - as not being technologists.

Dragon technology is the state-of-the-art in large vocabulary speaker-independent ASR. Jim Baker's basic mathematical framework is still the basis for all commercial ASR systems. This included the L&H ASR technology at the time of the deal. Each company's ASR engine has its own bells and whistles to distinguish it, but the main differentiator these days is the access to domain-specific data for training the statistical models - in combination with the many heuristic tricks used in building those models.

It is hard to know the source of your bad anecdotal experience with Dragon Naturally Speaking. The technology has its limitations, and just "doesn't work" in probably 20% of the situations (broadly defined) in which it is deployed. The field needs another 2 or 3 fundamental research breakthroughs before any random use case could be guaranteed to be effective. But, many people have found Dragon dictate quite useful, particularly in restricted language domains, such as legal, medical, and business emails.

Oh, and the ASR engine behind Siri _is_ a version of Dragon, so your post is somewhat non-sensical.

Get 'em!

[geohump]

Go Jim and Janet, Go!
Don't forget legal fees and damages!

Former Dragon Employee, wishing you well.