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Dear Mr. Berko:

Dear T.P.:

Goldman Sachs Group Inc. (GS-$147.20) will sell anything to anybody, anywhere, anytime. If someone designs a better Porta-John, Goldman will package it as a private offering, perfume it, and tell buyers that removal of the waste product is booked as a loss and therefore treated as a tax deduction. I knew Gus Levy when he was chairman of Goldman until he passed away in 1976. If Gus were alive today, he’d turn over in his grave if he had any inkling of what Goldman was doing.

But not to worry. The Securities and Exchange Commission (SEC) investigation is just a speed bump as Goldman and other Wall Street banks collude to establish their New World Order. Your 77 shares of Goldman Sachs are as safe as if they were insured by St. Peter himself. If you have any doubt, just ask Warren Buffett, who now owns $8 billion in Goldman stock.

The stock, which is down from $190, is still attractive, and first-quarter earnings of $3.6 billion blew the doors off the hinges.

I suggest that you round out those 77 shares to an even 100. Though I viscerally abhor Goldman’s “Greed is good” business model, I admit to a breathless admiration for the company’s raw power and awesome manipulation skills. Because GS has threatened to fire 37 congressmen, this impregnable company will emerge from an SEC hearing stronger than ever, and SEC Chairman Mary Schapiro will bow and kiss Goldman Chairman Lloyd Blankfein’s ring.

Steel Dynamics Inc. (STLD-$15.35) is a $4 billion revenue, low-cost steel producer home ported in Fort Wayne, Ind. Although the global slowdown is affecting all steel makers’ near-term profits, STLD’s very flexible cost structure is proving to be an advantage in slow markets as well as good ones.

Unlike integrated steel mills that use iron ore and coking coal as raw inputs, STLD’s ultra-modern and lower-cost mini mills use ferrous scrap. They require 31 percent fewer employees to produce a ton of flat-rolled steel than the competition. Steel Dynamics is the lowest-cost flat-rolled steel producer in the United States and also makes “long products” such as beams, girders, bars and rails.

STLD’s efficiencies also make the company one of the lowest-cost producers in the world, so it easily competes in the foreign markets. Meanwhile, the company is 100 percent self-sufficient in ferrous scrap (which is environmentally friendly), creating an interesting hedge against worldwide competitors that have begun to build mini mills.

Steel Dynamics is the largest scrap-metal recycler in the United States and probably even the world. This extremely well-managed company is also employee friendly, rewarding productivity with performance bonuses and stock options. The company’s founders own 7 percent of the stock; they don’t have platinum parachutes; its board members are independent; and (unlike most public boards) they really contribute to STLD’s operations.

Standard & Poor’s, Morningstar, Bank of America, Wells Fargo and Credit Suisse have a positive outlook for the steel industry in the coming dozen months, indicating a 12.5 percent increase in steel consumption versus a 44 percent decline last year. Of course, this bodes well for STLD, so Standard & Poor’s and Key Bank have a “buy” recommendation on the stock with a median target price of $22. Hold STLD.

Please address your financial questions to Malcolm Berko, P.O. Box 8303, Largo, Fla. 33775 or e-mail him at mjberko@yahoo.com. © 2010 Creators.Com