Caught Between a soul in every stone unturned under the inexhorable Goldman's Sack

[David Morris]

http://www.dailykos.com/storyonly/2010/5/2/861553/-Whats-Wrong-with-Wall-Street

The deep flaw in the current system was on direct display in last
week's hearings.

Levin cited a "fundamental conflict" in Goldman's selling to clients
home-loan securities that company e-mails showed its own employees had
derided as "junk" and "crap" — and then betting against the same
securities and not telling the buyers.
"They're buying something from you, and you are betting against it.
And you want people to trust you. I wouldn't trust you," Levin told
Blankfein.

How did it happen that Goldman Sachs, and the other large investment
banks, came to be playing both ends of the same deal? It happened like
this.

In 1999, the Gramm-Leach-Bliley Act was passed. The act repealed part
of a law dating back to 1933 called the Glass-Steagall Act. That's a
lot of names in a short time, but the quick version is that
Glass-Steagall was passed to control the rampant speculation that had
helped cause the collapse of banking at the outset of the Great
Depression. Glass-Steagall specifically divided the banking industry
so that banks issuing loans, insurance firms providing coverage, and
firms offering investments were strictly separated.