GOP Ohio Governor Candidate John Kasich: Records Show He Bought Into A Goldman Sachs Internet Fund Before It Was Launched

CINCINNATI (TDB) -- John Kasich was chairman of the U.S. House Budget Committee in July 1999 at the height of the dotcom boom. His federal financial disclosure statement (a portion excerpted above) shows he acquired a stake in the Goldman Sachs Internet fund on July 1, 1999. But Goldman Sachs didn't launch its Internet mutual fund until October 1, 1999. Kasich's financial disclosure statement indicates he got a three month head start. The record suggests that Kasich -- who didn't seek reelection in 2000 -- was closely following developments on Wall Street. Did he have access to inside information? Goldman Sachs said it created the Internet fund to offer an opportunity to invest in "what may be the most compelling technological change in our lifetime." It was the go-go era before the dotcom crash. After leaving the House, Kasich went to work for Lehman Bros. Inc., a Wall Street investment bank that collapsed in 2008.

Copies of four years worth of Kasich's House financial disclosure reports are available here (pdf) at the Center for Responsive Politics. [Ed. Note: The financial disclosure statement about Goldman Sachs is for calendar year 1999. Kasich signed and dated it May 12, 2000. He certified the information was accurate: "I certify that the statements I have made on this form and all attached schedules are true, complete and correct to the best of my knowledge and belief." The word certify is printed in capital letters.] Zacks.com has data about the Goldman Sachs Internet fund, which trades under the symbol GITAX. And Money Magazine's online edition noted the fund's Oct. 1, 1999 debut with a headline that day saying, Goldman Cooks Up A Net Fund. Just in case there are any doubts about the October 1, 1999 launch date of the Goldman Sachs fund, the Daily Bellwether has retrieved a decade old Goldman Sachs press release that announces its opening to investors. The full-text is reprinted below:

"PR Newswire
October 1, 1999, Friday - 13:35 Eastern TimeGoldman Sachs Launches the Goldman Sachs Internet Tollkeeper Fund(SM); A Different Approach to Internet InvestingSECTION: Financial NewsLENGTH: 760 wordsDATELINE: NEW YORK, Oct. 1Goldman Sachs Asset Management today launched the Goldman Sachs Internet Tollkeeper Fund, a specialty equity mutual fund investing in growth companies poised to benefit from the expansion of the Internet. What is an Internet Tollkeeper? -- Internet Tollkeepers include established telecommunications, media, technology and Internet companies; -- These businesses, like a toll collector for a highway or a bridge, have the ability to grow revenue by increasing traffic (customers or sales) and by raising tolls (prices); -- These are companies with strong market share, brand recognition, recurring revenue streams and pricing power. What is the investment focus of the Goldman Sachs Internet TollkeeperFund? -- Primarily, companies that provide access, content (movies, music and videos), services and infrastructure (servers, routers, networks) to Internet providers and users; -- Secondarily, companies whose rapid adoption of the Internet has improved their business model, as well as Internet-based companies capable of generating long-term sustainable profitability, -- This approach contrasts that of "pure play" Internet funds investing in new dot.com companies. Who manages the Goldman Sachs Internet Tollkeeper Fund? -- The Goldman Sachs growth equity team, managers of the Goldman Sachs Capital Growth, Strategic Growth and Growth Opportunities Funds; -- A team with an 18 year institutional track record and over 150 years' combined investment experience. "The evolution of the Internet has transformed the economic landscape. Theopportunities that have been created are significant -- so, too, are therisks, particularly for investors," said Douglas Grip, President of GoldmanSachs Funds Group. "The Goldman Sachs Tollkeeper Fund offers a potentiallymore conservative approach to investing in what may be the most compellingtechnological change of our lifetime." Goldman Sachs Asset Management was formed in 1988, providing individualinvestors the opportunity to tap the resources of a premier global financialservices firm and put this expertise to work for them in their individualportfolios. As of June 30, 1999, Goldman Sachs Asset Management had $191.1billion in assets under management. Investors have access to more than 30 Goldman Sachs Funds, managedaccording to institutional investment processes that deliver region-,capitalization-, and style-specific equity portfolios; and benchmark-driven,research-intensive fixed income funds. These investment processes combine thebest of what Goldman Sachs has to offer: active management, global resources,significant research capabilities, risk management expertise, proprietaryquantitative models, and a team approach. Goldman Sachs (NYSE: GS) is a leading global investment banking andsecurities firm, providing a full range of investing, advisory and financingservices worldwide to a substantial and diversified client base, whichincludes corporations, financial institutions, governments and high net worthindividuals. Founded in 1869, it is one of the oldest and largest investmentbanking firms. Goldman Sachs is headquartered in New York and maintainsoffices in London, Frankfurt, Tokyo, Hong Kong and other major financialcenters around the world. Some risk factors that can negatively affect pure-play internet stocks canalso negatively affect Internet Tollkeeper stocks. The Fund is subject togreater risk of loss as a result of adverse economic, business or otherdevelopments than if its investments were diversified across differentindustry sectors. Securities of issuers held by the fund may lack sufficientmarket liquidity to enable the fund to sell the securities at an advantageoustime or without a substantial drop in price. For more complete information about the Goldman Sachs Internet TollkeeperFund, call 800-526-7384 and request a prospectus. Read the prospectuscarefully before investing. Goldman, Sachs & Co. is the distributor of the Goldman Sachs Funds. The Goldman Sachs Internet Tollkeeper Fund(SM) is a service mark ofGoldman, Sachs & Co. SOURCE Goldman, Sachs & Co. CONTACT: Kathleen Baum of Goldman, Sachs & Co., 212-902-5400COUNTRY: UNITED STATES (92%); 92%);STATE: NEW YORK, USA (92%); 92%);CITY: LONDON, ENGLAND (65%); 65%);COMPANY: Goldman, Sachs & Co. GOLDMAN SACHS GROUP INC (98%); GOLDMAN SACHS GROUP INC (98%); GOLDMAN SACHS FUNDS GROUP (64%); P (64%); ORGANIZATION: Goldman, Sachs & Co. GOLDMAN SACHS FUNDS GROUP (64%); TICKER: GS (NYSE) (98%); GS NDSEG##GS"

Wall Street Foresees Horrible Year For Newspapers: Are They Killing Themselves?

CINCINNATI (TDB) -- The newspaper industry is ailing, and Goldman Sachs sees its condition getting even worse in 2008. Advertisers and readers already are deserting, and the downturn is expected to accelerate as the overall national economy slows. If Goldman Sachs is correct, newsrooms should be shivering because bad times are going to be badder and more jobs will disappear as the industry contracts. Mediabistro noted today that the newspaper division chief at Gannett Co. Inc., the nation's largest newspaper chain, has decided to get out. Gannett owns The Cincinnati Enquirer, Ohio's third largest metro daily, where budget cuts have been trimming staff along with space for comprehensive news coverage.

Meanwhile, Daily Bellwether contributor Bill Osinski -- a former Akron Beacon Journal reporter who also spent time on news staffs in Atlanta and Detroit -- sees the newspaper biz as culpable for its own decline. He thinks the budget cutting is a death wish. Osinski's take:

Newspapers On Suicide Watch
With recent studies showing that major newspaper corporations have lost an astounding 42 per cent of their stock value in the past year, one could be forgiven for concluding that rumors of the industry's death have not been exaggerated. But this could be a case of a self-fulfilling death wish.

To wit, imagine this transcript of a recent telephone conversation:
Operator: Hello. Suicide Hotline.
Caller: Yes. Max Media here. I'm trying to commit suicide, and I need help.
Operator: That's what we're here for, friend.
Max: No, no. I run a chain of newspapers, and I've been predicting their demise for years. I just need a little help in figuring out how to put me and my thousands of employees out of our misery.
Operator: But we're supposed to stop such things.
Max: Work with me a little here, will ya. Look, I've done all I can think of to ruin my business. I've had wave after wave of buyouts and layoffs, so I've run off most of my best and most experienced editors and reporters; I'm giving my product away on the Internet, even though I don't have a clue about how to sell ads in cyberspace; and I've dumbed-down the newspapers to the point where I'm driving off droves of readers every day.
Operator: Sounds like you're doing a pretty good job of doing away with yourself. But why are you so determined to stay in despair? Look, I still get the newspaper. I like it. I get lots of info I can't get anywhere else. And who's going to tell me what's really going on in my city when you're gone? Why don't you just wake yourself up, dust yourself off, stop trying to be like radio and TV?
Max: Hmmm. Put out a better product. What a concept.
Operator: See, I told you. Everything's not as bleak as it may seem.
Max: Nah. I'd rather be right and fail than succeed but prove myself wrong. Besides, I just can't wait to write my own obit.