Unlike the previous session with AIG’s Cassano, this session with
Gary Cohn, President of Goldman Sachs, and Craig Broderick, head of
credit, market and operational risk, has been particularly dull. The
Commissioners have wasted a valuable opportunity to ask more probing
questions and discover anything of substance.

On questions
concerning Goldman Sachs’ overall exposure to AIG, Cohn has been
evasive, either speaking in generalities or asserting that his CFO
David Viniar, who is testifying tomorrow, will "know the numbers cold".
And on other questions, like how much revenue Goldman Sachs accrued
from its derivatives operations, Cohn has simply said that GS would not
have any reports that would calculate that information.

And on
more specific questions, like why Goldman Sachs consistently marked AIG
securities lower than its peers in ’07 and ’08, contributing to AIG’s
downfall, Cohn has simply asserted that the marks were based on other
"relevant transactions"–that they were fair.

Unfortunately the
last hour of the session devolved into the Commissioners pulling out
obscure charts that were supposed to delineate lucid conclusions that
Cohn didn’t know how to interpret or couldn’t comment on, leading to a
circular line of questioning. Why didn’t Commissioners take this
opportunity to ask about the SEC’s civil fraud lawsuit? Or ask specific
questions about its practice of misrepresenting mortgage deals? It’s
unclear if the panel used their time wisely.

Tomorrow’s hearing,
with Viniar, who apparently knows the numbers, should be slightly more
illuminating. Final thoughts on all the sessions today will be posted
later.