Earlier this year, I did a blog entry on Matt Taibbi's piece in Rolling Stone on how Goldman Sachs had engineered market manipulation since the Great Depression.

Now, McClatchy Newspapers investigative reporter Greg Gordon has a piece that really raises serious questions about the legality of Goldman Sachs actions by accusing the bank of selling securities backed by at least 200,000 risky home mortgages while at the same time placing bets that the US housing market would crash. As Boston University economics professor Laurence Kotlikoff told Gordon, it smells like a fraud and should be prosecuted. "The Securities and Exchange Commission should be very interested in any financial company that secretly decides a financial product is a loser and then goes out and actively markets that product or very similar products to unsuspecting customers without disclosing its true opinion," Kotlikoff said.

Gordon's investigation is deeply disturbing because it suggests the bank has been getting protection from the US government with its links running deep. Goldman vice president, Adam Storch, has been named managing executive of the SEC's enforcement division and then of course, there was the bailout of the banks engineered by former Goldman Sachs manager Henry Paulson. The richest people in the United States were in effect put on welfare, a truly disgusting outcome.

The allegation that Goldman Sachs was playing both sides of the street, and making mega bucks from the implosion of the US economy, needs to be fully investigated.