In most American States, prostitution is illegal. But investment banking (of the Goldman Sachs' variety) is not, which is ironic. Because prostitution these days is not a danger to anyone (what with condoms and all to stem the spread of aids). But GS style I-Banking is different.
Since GS does not make anything, lots of its activities are zero sum activities. Since their entire business model is based on not adding any tangible value to anything, all their profits, at some level, do come out of the losses of others. Whenever they make money, it usually means that some other poor dude is losing money elsewhere - and not getting anything for it. At least with prostitutes, they get momentary pleasure. With GS, everyone involved gets ripped off - except GS investors and GS employees.
Of course, one must think twice before one blames a company for doing something that is fully legal. Splicing and selling securities. If there is money to be had, and you know how to get at it within the framework of today's restrictions - they would be wholly irrational if they did not do it. So, the blame must not lie with GS' employees or with its management - who have just exploted a loophole in the law. Just like one must not blame the prostitute for selling sex. She's got a family to feed - as does a GS employee. The GS employee feed his/her family with Caviar - wheras the prostitute does so with bread - but the picture is the same. I have no beef with GS employees (except that I view them with utter condescention - because they had a choice to do something meaningful with their lives, but they chose to do something utterly meaningless and damaging to others). I do not view prostitutes with condescention, of course. They, on the other hand really have no choice. I don't think they like performing demeaning sexual acts with anyone with a thick wallet. But they have to.
My issue is with the nexus between the policy makers and GS. American public policy, it looks like, is more in tune with keeping GS alive by bailing out everyone that ower it money (AIG's $13B bailout comes to mind) than looking out for American taxpayer interests. If the US taxpayer had not bailed out AIG, it looks like GS would have perished. That would have been lovely. Perhaps its employees could do something useful with their lives instead.