While Goldman’s later pattern would be to capitalize on changes in the regulatory environment, its key innovation in the Internet years was to abandon its own industry’s standards of quality control.

“Since the Depression, there were strict underwriting standards that Wall Street adhered to when taking a company public,” says one prominent hedge-fund manager. “The company had to be in business a minimum of five years, and it had to show profitability for three consecutive years. But Wall Street took those guidelines and threw them in the trash.” Goldman completed the snow job by pumping up the sham stocks: “Their analysts were out there saying Bullshit.com is worth $100 a share.”

Matt Tabbi’s Rolling Stone article on Goldman-Sachs, “The Great American Bubble Machine (PDF),” is just as frustrating as advertised. The U.S. economy comes off as a big confidence game, rigged to the benefit of insiders and lacking any consequences for its momentous failures.

Instead of improving the situation, Obama seems to be further entrenching the status quo.