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Right after a Delaware state judge issued his ruling last week in a shareholder lawsuit contesting Kinder Morgan Inc.’s purchase of El Paso Corp., the public finger-wagging aimed at Goldman Sachs Group Inc. began.

Goldman, some pundits wrote, had emerged as the biggest loser of the bunch. The bank’s conflicts of interest in advising El Paso on the deal had been castigated by an esteemed jurist as breathtakingly over the top. Once again, Goldman had sullied its precious reputation. And so on, critics said.

While it’s always fun to fantasize about Goldman losing at anything, one gnawing question stands out: What exactly did the company lose? The answer is nothing, as far as I can tell. Actually, it won big.

Consider these facts: El Paso’s board knew that Goldman owned a 19 percent stake in Kinder Morgan worth about $4 billion when the companies’ buyout talks began last year. The directors knew Goldman controlled two seats on Kinder Morgan’s board. They were aware that Goldman had every incentive to maximize its own investment and fleece El Paso’s shareholders. Yet they turned to Goldman anyway for advice on responding to Kinder Morgan’s takeover overtures.

El Paso probably could have gotten a better price from Kinder Morgan had its representatives, including Goldman, been more faithful and less conflicted, Delaware Chancery Court Judge Leo Strine said. The difficult question he faced was whether to do anything about it. He decided he shouldn’t, concluding that any remedy he tried to fashion would do more harm than good.

DONE DEAL

He didn’t block the proposed $21.1 billion transaction between the two Houston-based pipeline operators. The sale will go through. Goldman, the world’s top-ranked takeover adviser based on deals announced last year, still gets its $20 million fee from El Paso. In all likelihood, nothing about this episode will stop anyone else from hiring Goldman in the future. Plus, Strine said it’s doubtful Goldman could be held liable for any damages, based on the facts known so far.

Maybe Goldman’s reputation did take a hit. Yet after so many scandals the past few years, including the company’s $550 million fraud-claim settlement with the Securities and Exchange Commission in 2010, you have to wonder if this new one matters.

Nobody was fooled last year when Goldman’s chairman and chief executive officer, Lloyd Blankfein, made a spectacle of unveiling a new set of fluffy business principles pledging to put clients’ interests first. It’s not the principle that counts in this business. It’s the money. And on this occasion, Goldman got a sweet deal.

Nothing was left to chance, it seems. Steve Daniel, the lead Goldman banker advising El Paso, personally owned $340,000 of stock in Kinder Morgan. This point wasn’t disclosed to El Paso, although it’s hard to imagine its directors would have cared much. They already knew he was horribly conflicted, because of his employer’s $4 billion stake in Kinder Morgan. What would their complaint have been? That he was really, really conflicted?

Not surprisingly, Goldman’s analyses of El Paso’s options pointed toward accepting Kinder Morgan’s offer. Goldman supposedly set up a “Chinese wall” to keep its bankers conflict-free. And a second bank, Morgan Stanley, was brought in to advise El Paso. The judge said the wall wasn’t effective, though. (As if these things ever are.) Goldman made sure the terms were set so that Morgan Stanley got paid only if Kinder Morgan bought the company, Strine wrote.

A deal benefiting Kinder Morgan may have been what some of El Paso’s bosses wanted. As Strine explained, El Paso’s CEO and chairman, Douglas Foshee, didn’t tell his board that he and other El Paso managers wanted to buy back El Paso’s energy exploration-and-production business from Kinder Morgan for themselves, after the deal was negotiated.

WARPED INCENTIVES

Foshee’s incentive was to limit the sale price that El Paso got, not maximize it. “Not forcing Kinder Morgan to pay the highest price possible for El Paso was more optimal than exhausting its wallet, because that would tend to cause Kinder Morgan to demand a higher price for the E&P assets,” Strine wrote. The board had given Foshee sole responsibility for negotiating the company’s sale from the outset. As for Kinder Morgan, it drove a hard bargain, as it was entitled to do.

So what did Goldman do wrong? Its bankers seem to have behaved like sharks. Guess what? Investment bankers are sharks. Goldman’s reputation was reinforced, not damaged.

If El Paso’s shareholders dislike the deal, they can vote against it. The vast majority won’t. There is no competing bidder, because El Paso’s board didn’t seek one. What El Paso shareholders lost was the possibility that another company might have offered a higher premium than Kinder Morgan did. There’s no way to know if anybody would have.

While the conflicts here may have been extreme, managers and buyout advisers at big companies pull similar escapades all the time, skimming corporate resources for themselves at the expense of passive shareholders. (Foshee stands to receive about $90 million once the sale is completed.) There usually isn’t much outsiders can do about it, which is something everyone should understand before they buy stock in a public company.

As for the notion that Goldman lost? Come on. It was paid $20 million for advising a client in a deal where Goldman itself was on the other side. What’s amazing is that El Paso let Goldman pull this off.

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Victoria’s Secret parent Limited Brands Inc (LTD.N: Quote, Profile, Research, Stock Buzz) reported a large sales gain for February, leading a charge of retailers that benefited from rising consumer confidence to beat Wall Street forecasts.

Limited, which also owns Bath & Body Works, said on Thursday that sales at stores open at least a year rose 8 percent last month, above the analysts’ average forecast of 6.2 percent compiled by Thomson Reuters.

So far six retailers, including Stage Stores (SSI.N: Quote, Profile, Research, Stock Buzz), and teen-oriented The Buckle Inc (BKE.N: Quote, Profile, Research, Stock Buzz) and Zumiez Inc (ZUMZ.O: Quote, Profile, Research, Stock Buzz) have reported February sales that have come in above Wall Street forecasts.

Improving consumer confidence is one reason analysts expect February same-store sales to be up 3.4 percent for the 21 companies tracked in Thomson Reuters’ same-store sales index.

Other chains, including Macy’s Inc (M.N: Quote, Profile, Research, Stock Buzz), Kohl’s Corp (KSS.N: Quote, Profile, Research, Stock Buzz) and Target Corp (TGT.N: Quote, Profile, Research, Stock Buzz), will report later on Thursday morning.

The housing market appears to be stabilizing, and the unemployment rate fell to 8.3 percent in January from 9.1 percent in August. The University of Michigan’s consumer confidence survey rose for the sixth straight month in February payday lenders.

And the surging stock market, which this week hit its highest levels since May 2008 financial meltdown, has been a boon for upscale chains like Saks Inc (SKS.N: Quote, Profile, Research, Stock Buzz) and Nordstrom Inc (JWN.N: Quote, Profile, Research, Stock Buzz) in recent months.

But the rising price of gasoline is casting a pall on consumer spending. As of Thursday, a gallon of gas in the United States cost $3.74, up 35 cents from a year earlier, according to the American Automobile Association.

On Wednesday, Costco Wholesale Corp (COST.O: Quote, Profile, Research, Stock Buzz) said its same-store sales had risen 8 percent in February, outpacing the 7.6 percent rise that analysts expected, according to Thomson Reuters data. Much of the warehouse club chain’s gains in the past year have come from shoppers seeking cheaper gasoline.

Wet Seal (WTSLA.O: Quote, Profile, Research, Stock Buzz) was one of the few chains to report a decline in sales, but the fall of 5.8 percent was less steep than expected.

Home decoration and furniture chain Pier 1 Imports Inc (PIR.N: Quote, Profile, Research, Stock Buzz) said its same-store sales for the full holiday quarter rose 10.3 percent.

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A second, euro130 billion ($172 billion) bailout and a deep debt write-off for financially stricken Greece will ward off a financial disaster in Europe.

Economists, however, only give the deal a slim chance of putting the country on the path to economic recovery _ and steadying its place in Europe’s currency union.

Agreement on the bailout, reached early Tuesday after an all-night summit of finance ministers seven months after it was first proposed, will give Greece euro130 billion in loans through 2014 from other eurozone governments and the International Monetary Fund. It’s the country’s second bailout, following a euro110 billion rescue secured in 2010 that didn’t return the country to solvency.

The agreement also assumes that banks and investors owed money by Greece will take new bonds that reduce their holdings by more than half.

In return for the second bailout, Greece has agreed to painful and humiliating measures imposed by its mistrustful partners which also use the euro, annoyed after two years of what they say are broken promises to reform. Athens agreed to cut spending and wages, and to permit outsiders to supervise its finances through the presence of European Union and International Monetary Fund officials permanently stationed in Greece. The rescuers also demanded a separate account for the aid money and legal guarantees that creditors get paid before teachers, doctors and police do.

The finance ministers from Greece and the other 16 countries that use the euro wrangled until the early morning over the details of the rescue, squeezing last-minute concessions out of private holders of Greek debt who agreed to lose 53.5 percent of the face value of their investment to avoid even more severe losses expected if Greece fails to pay euro14.5 billion in debt coming due March 20.

The fear is that an uncontrolled bankruptcy could unleash market panic across the rest of the continent, further unsettling other struggling other debt-stricken countries such as Ireland, Portugal or the much bigger Italy or Spain.

Serious risks of failure include the chance that Greece’s economy remains in a deep recession _ where it’s been for four straight years _ instead of returning to growth in 2013 as the deal assumes. That would undermine chances of paying even the reduced debt load, estimated at a still-high 120 percent of annual economic output in 2020, down from 160 percent now.

Additionally, political outrage over the cutbacks could lead Greece politicians to balk at the tough conditions. That could push rescuer countries _ led by Germany _ to cut off further funding.

Elections in Greece are expected in April. The leaders of the two main parties have committed to the cuts and reform program, but anti-bailout parties have been gaining in the polls.

Growth is the key. But Greece’s economy shrank 7 percent in the fourth quarter of last year and unemployment is 19 percent, a consequence of cuts in public wages and increased taxes inflicted during a downturn.

If that keeps up, even the rescuers acknowledge the reduction goal of 120 percent of GDP is long gone.

Success “really depends on the assumptions you make in terms of growth and interest rates,” said Diego Iscaro, an economist at IHS Global Insight. “The risks are clearly on the downside. The main risk comes from the economic situation, the economic dire straits.”

“By austerity alone, Greece will not solve the problems it has at the moment. We don’t know when the economy will return to growth and how it will grow.”

Unless something breaks the cycle of austerity and contraction “something will have to give.”

Even if it later balks at the conditions for the bailout, Greece would have difficulty writing down the new debt it issued to private bondholders, who demanded stronger legal protections. Official creditors _ the IMF, the eurozone countries and the European Central Bank _ would also have difficulty accepting more writedowns. Inability to pay _ or unwillingness to accept the harsh conditions _ could lead to a non-negotiated “hard” default that could end in Greece leaving the euro.

The eurozone and the International Monetary Fund hope the new program will eventually put Greece back into a position where it can survive without external support. Both private and official creditors went beyond what they had said was possible in the past. On top of the new rescue loans, Athens will also ask banks and other investment funds to forgive it some euro107 billion ($142 billion) in debt, while the European Central Bank and national central banks in the eurozone will forgo profits on their holdings.

The deal “closes the door to an uncontrolled default that would be chaos for Greece and Greek people,” said European Commission President Jose Manuel Barroso.

But despite those unprecedented efforts, it was clear that Greece was at the very best starting on a long and painful road to recovery. It is being pushed to make its economy more business-friendly and productive by opening access to closed trades and professions; halting rampant tax evasion; allowing more flexibility in wage bargaining between companies and unions; simplifying starting a business; and cutting its bureaucracy.

But those measures will take years to work _ if Greece’s politicians are willing or able to push them through.

“It’s not an easy (program), it’s an ambitious one,” said Christine Lagarde, the head of the IMF, adding that there were significant risks that Greece’s economy could not grow as much as hoped.

Including Greece’s first bailout worth euro110 billion ($146 billion), the new deal means every Greek man, woman and child will owe the eurozone and the IMF about euro22,000 ($29,000).

In Athens, the reaction to the news was a mixture of relief the country has avoided financial catastrophe and fear of a dark future.

“I don’t see it with any joy because again we’re being burdened with loans, loans, loans, with no end in sight,” architect Valia Rokou said in the Greek capital.

Greek politicians nevertheless greeted the package as a turning point for their battered country.

“It’s no exaggeration to say that today is a historic day for the Greek economy,” said Greek Premier Lucas Papademos, who had rushed to the finance ministers’ meeting to lend weight to his country’s pleas for help.

For those who Greece owes money, the bond swap will lop euro107 billion off Greece’s euro352 billion load. On top of that, investors will be asked to give Athens 30 years to repay them, compared with just under 7 years.

Average interest rates would fall to 3.65 percent from around 4.8 percent.

Overall losses for private bondholders would be above 70 percent when accounting for the new bonds’ longer repayment period and lower interest rate.

Private investors weren’t the only ones having to give ground. The eurozone countries will reduce the interest that Greece has to pay for its first package of bailout loans to 1.5 percentage points over market rates from between 2 percentage points to 3 percentage points currently.

At the same time, the European Central Bank and the national central banks in the countries that use the euro will forgo profits on their Greek debt holdings, again reducing the costs for Greece.

But several hurdles remain before Greece will see any of the money or other benefits of the new program.

Apart from the implementation of more than 30 different savings and reform measures by Greece, the new bailout has to be debated by parliaments in several member states, including Germany, the Netherlands and Finland.

The IMF also still has to decide how much of the euro130 billion bill it is willing to stump up. Going into the meeting, the Washington-based fund had indicated its contribution will be lower than the one-third of the total it has provided in previous bailouts.

IMF chief Lagarde said the fund’s board would decide on its contribution in the second week of March.

“In doing so it will have in mind the overall program, but also additional matters such as the proper setting up of a decent firewall,” Lagarde said with reference to Europe’s current and future bailout funds.

At the moment, the overall ceiling for eurozone rescue loans has been set at euro500 billion ($663 billion), much of which has already been committed to Ireland, Portugal and now Greece. Euro leaders will decide at their summit in early March whether that ceiling should be increased.

On top of that, it will also take some time to see how many private creditors will participate in the debt relief and how many will have to be forced to sign up through new legal clauses. The representatives of the private bondholders said they were confident that investors would find the deal attractive, but some analysts fear that imposing losses on even some bondholders may destabilize markets.

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The Bank of Japan added to monetary easing after exports tumbled and the economy contracted by more than forecast in the fourth quarter.

Governor Masaaki Shirakawa

China will take measure to stabilize its exports and imports as slowing global growth creates a

Many non-stop flights from Europe to the U.S. aren’t: Unusually high winds are forcing airlines flying west across the Atlantic to make unscheduled stops to take on more fuel.

The conditions are causing inconveniences to fliers who are often missing connections once they land, costing the airlines money to rebook or otherwise compensate their customers.

United Continental Holdings (, Fortune 500), which is operating under both the United Airlines and Continental Airlines brands as it moves to complete its merger, said it diverted 43 out of 1,100 flights in December using the Boeing (, Fortune 500) 757 jet flying from Europe to the United States. A year earlier it only had to divert 12 flights.

Company spokeswoman Megan McCarthy said the winds were typically 30 knots in December the previous decade, but they averaged 47 knots last month, with half the month averaging 60 knots.

The unusually high winds and the flight diversions have continued in the first 11 days of January, she said, although she did not have any statistics.

Other airlines have also been affected. AMR () unit American Airlines said it has happened occasionally on the trans-Atlantic routes on which it uses the 757, although it could not provide statistics.

McCarthy does not have any estimates on costs to the airlines from the high winds, but said most of the costs have been associated with payments to customers free 3-in-1 credit report.

"We have been offering compensation as a gesture of good will when circumstances merit," she said.

The eastbound flights are saving fuel due to the unusually strong tail winds. The high winds have also been associated with an unusually mild start to winter in the United States, which has saved the airlines money as well.

The planes typically land at Gander and Goose Bay in the Canadian province of Newfoundland and Labrador. But other fueling stops have been made in Iceland, Ireland, Nova Scotia, Albany, N.Y., and even Stewart International Airport, only 60 miles north of New York City.

Some larger planes have a longer range and are not having to make as many extra stops to refuel. But the 757, which holds about 169 passengers, is common on trans-Atlantic flights.

McCarthy said it has been used for years by both Continental and United, and was not something that was introduced on the routes as a result of the recent merger of the two carriers. 

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India’s industrial production slid 5.1 percent in October, the first fall in over two years and one more sign of a reversal of fortunes for Asia’s third largest economy.

The decline from a year earlier was driven by mining and manufacturing, as well as waning consumer demand and lackluster investment, according to government figures released Monday.

Industrial output hasn’t fallen in India since June 2009.

Despite global headwinds, many economists say India’s troubles are largely homegrown, as the effects of 13 consecutive interest rate hikes begin to ripple through the economy. Political paralysis has also made it difficult to kickstart growth and investment in the face of a plunging rupee and two years of near double-digit inflation.

“This slowdown is clearly continuing and it may be intensifying,” HSBC chief economist for India, Leif Eskesen, said from Singapore. “What’s driving it is the lagged effect of monetary tightening and the high level of inflation that are causing uncertainty about the macroeconomic outlook. That hurts incentives to invest and spend.”

He said policy paralysis was also contributing to India’s woes.

With little scope for stimulus spending, India needs to enact difficult but crucial reforms to kickstart the economy and reassure investors, who are jittery from the dark global economic outlook, economists and businesspeople say.

The government’s humiliating U-turn on its decision to allow greater foreign investment in retail, however, suggests that the ruling Congress Party _ fractured by internal divisions and facing a revolt by opposition parties and coalition allies _ no longer has the leverage to push its reformist agenda.

Parliament has yet to address a slew of issues, which could help spur investment and kickstart growth, which slipped to 6.9 percent in the September quarter, the lowest in over two years.

On the table are a land acquisition bill, which advocates say would ease contentious land transfer policies and speed investment, as well as tax reform, new mining regulations and measures to allow greater foreign investment in defense and aviation.

Last October, industrial production grew by over 11 percent.

The fall was much sharper than expected and puts pressure on the central bank to arrest or start reversing a series of interest rate hikes when it meets this week.

A CNBC-TV18 poll of economists had forecast industrial production to contract 1.6 percent.

Mining activity shrank by 7.2 percent in October, constrained by bureaucratic bottlenecks. Manufacturing slid by 6.0 percent.

Consumer goods production dropped 0.8 percent, while capital goods output plunged 25.5 percent _ a sign of waning investment.

Headline inflation has averaged 9.6 percent since January 2010.

India’s benchmark Sensex index is down over 22 percent this calendar year, making it one of the worst performing in the region. The rupee is down about 14 percent this year and recently hit a lifetime low.

The Ministry of Finance last week trimmed its growth projection for the fiscal year through March to around 7.5 percent, down from an earlier forecast of 9 percent.

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Egypt’s Muslim Brotherhood, emerging as the biggest winner in the first round of parliamentary elections, sought Saturday to reassure Egyptians that it would not sacrifice personal freedoms in promoting Islamic law.

The deputy head of the Brotherhood’s new political party, Essam el-Erian, told The Associated Press in a telephone interview that the group is not interested in imposing Islamic values on Egypt, home to a sizable Christian minority and others who object to being subject to strict Islamic codes.

“We represent a moderate and fair party,” el-Erian said of his Freedom and Justice Party. “We want to apply the basics of Shariah law in a fair way that respects human rights and personal rights,” he said, referring to Islamic law.

The comments were the clearest indication that the Brotherhood was distancing itself from the ultraconservative Islamist Nour Party, which appears to have won the second-largest share of votes in the election’s first phase.

The Nour Party espouses a strict interpretation of Islam similar to that of Saudi Arabia, where the sexes are segregated and women must be veiled and are barred from driving.

Egypt’s election commission has released few official results from the voting on Monday and Tuesday. But preliminary counts have been leaked by judges and individual political groups showing both parties could together control a majority of seats in the lower house of parliament if they did form an alliance.

The Brotherhood recently denied in a statement that it seeks to form an alliance with the Nour Party in parliament, calling it “premature and mere media speculation.”

On Saturday, el-Erian made it clear that the Brotherhood does not share Nour’s more hard-line aspirations to strictly enforce Islamic codes in Egyptians’ daily lives.

“We respect all people in their choice of religion and life,” he said.

Another major check on such an agenda is the council of generals who have run the country since President Hosni Mubarak’s ouster in February. The military council, accused by Egypt’s protest movement of stalling a transition to civilian and democratic rule, is seeking to limit the powers of the next parliament and maintain close oversight over the drafting of a new constitution.

Egypt already uses Shariah law as the basis for legislation, however Egyptian laws remain largely secular as Shariah does not cover all aspects of modern life.

On its English-language Twitter account, the Brotherhood said that its priorities were to fix Egypt’s economy and improve the lives of ordinary Egyptians, “not to change (the) face of Egypt into (an) Islamic state.”

El-Erian urged the Brotherhood’s political rivals to accept the election results.

“We all believe that our success as Egyptians toward democracy is a real success and we want everyone to accept this democratic system. This is the guarantee for stability,” he said.

For decades, Mubarak’s regime suppressed the Brotherhood, which was politically banned but managed to establish a vast network of activists and charities offering free food and medical services throughout the country’s impoverished neighborhoods and villages.

It is the best organized of Egypt’s post-Mubarak political forces.

The vote for parliament’s lower house is taking place over three stages, with 18 provinces in Egypt yet to vote.

Meanwhile, the swearing-in of a new temporary Cabinet was delayed on Saturday due to disagreements over key posts, including over who will lead the ministry in charge of internal security.

An official in the Interior Ministry said several high-ranking security officials have been named as possible replacements but that some have turned down the offer.

Protesters have also strongly objected to the nominations put forward by newly appointed Prime Minister Kamal el-Ganzouri, who served in the same position under ousted President Hosni Mubarak from 1996 to 1999.

The country’s ruling military general, Field Marshal Hussein Tantawi, appointed el-Ganzouri as a new interim prime minister last month after the previous premier’s government resigned in the wake of a police crackdown on protesters that killed over 40 people.

The interim Cabinet will serve until after the parliamentary elections finish in March. A new government is to be formed after the legislature is seated.

Activist Hussein Hammouda, a retired police brigadier, is among those opposed to the names being considered for the Interior Minister post and says someone from outside the police force should be chosen instead.

Protesters in Tahrir Square, the epicenter of Egypt’s protests, released a statement saying they would continue their sit-in while allowing traffic to resume normally in the area.

There were tens of thousands of protesters in the square in the days leading up to the elections, but numbers have dwindled to several hundred since then. Protesters demanding el-Ganzouri be replaced as prime minister said they will keep up another sit-in outside the Cabinet headquarters.

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The worst week for the stock market in two months ended with a whimper in thin trading Friday.

The Dow Jones industrial average lost 4.8 percent this week, while the broader Standard & Poor’s 500 index fell 4.7 percent. Both had their worst weeks since Sept. 23.

Major indexes wavered throughout Friday’s session, which was shortened because it’s the day after Thanksgiving. Worries about Europe’s debt crisis flared up again after Italy had to pay 7.8 percent to borrow for two years at a debt auction. It’s another sign that investors are increasingly hesitant to lend to European countries.

The euro slipped to $1.32, losing 2 percent this week against the dollar. The drop puts the euro at its lowest level since Oct. 4.

Higher interest rates on government debt of Italy, Spain and other European countries have rattled stock markets in recent weeks. When borrowing costs climb above the 7 percent threshold, it deepens investor fears about a government’s ability to manage its debts. Greece, Ireland and Portugal had to seek financial lifelines when their interest rates crossed the same mark.

The Dow fell 25.77 points, or 0.2 percent, to close at 11,231.78. Of the Dow’s 30 stocks, Chevron Corp. lost 1.6 percent Friday, the biggest drop. Travelers Cos. Inc. added 1.2 percent, the largest gain.

The S&P 500 lost 3.12 points, or 0.3 percent, to 1,158.67. The Nasdaq composite dropped 18.57, or 0.8 percent, to close at 2,441.51.

Trading volume was 1.6 billion, less than half the daily average.

Markets were battered this week as governments in Europe and the U.S. struggle to tackle their debts. The Dow lost 248 points on Monday as a Congressional committee failed to reach a deal to cut federal budget deficits. It plunged 236 points Wednesday after investors balked at buying German government debt.

Retailers traded mixed on the Friday after Thanksgiving, the traditional start of the holiday shopping season and usually the busiest day of the year for retailers. Amazon.com Inc. dropped 3.5 percent. Wal-Mart Stores Inc. inched up 0.4 percent.

A record number of people were expected to show up at stores this weekend to take advantage of deep discounts. The National Retail Federation estimates that 152 million people will go shopping over the three days starting on Friday. That would be an increase of 10 percent from last year.

AT&T’s stock dipped less than 1 percent. The company said Thursday that it is budgeting to pay $4 billion in break-up fees if its attempted $39 billion takeover of T-Mobile USA from Deutsche Telekom falls apart.

Four stocks fell for every three that rose on the New York Stock Exchange.

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