The deal taxpayers should have negotiated with TARP.
Uncle Warren's 2008 investment in Goldman Sachs pays off handsomely. More proof that Geithner, Paulson, Kashkari and the entire team at Treasury and the New York Fed were blatantly poor negotiators. But lest we forget, that was the plan all along.
FORTUNE -- We knew Goldman Sachs was wounded in the financial crisis. It may have been in more trouble than is understood.
That's the sense you get from Warren Buffett's recently inked deal to turn the warrants Berkshire Hathaway received as part of its $5 billion investment in Goldman at the height of the financial crisis into stock. Do the math on the deal, and it becomes clear just how much Goldman's executives were willing to pay for cash at the time. Or maybe this is just the magic of Buffett. Or maybe it's both.
On Tuesday, as part of an amendment to its earlier deal, Goldman said it would hand $1.4 billion worth of shares to Berkshire. Buffet's company doesn't have to pay a penny for the shares. And this is after Goldman has already paid Buffett back for his financial crisis era investment in full, plus interest. Nice work if you can get it.