Yesterday's New York Times had an interesting but somewhat problematic

about Goldman Sachs' habit of

betting against its own clients

—a strategy the firm calls "embracing conflicts." As in, conflicts of interest.


was among the many that got screwed by Goldman?

Goldman was one of 22 financial companies that lent money to Thornburg [Mortgage]; it was using about $200 million of a Goldman credit line backed by mortgage loans.

In August 2007, Goldman was the first firm to begin aggressively marking down the value of Thornburg assets used as collateral for the loan. Goldman said the assets were not valuable enough to repay the loan if Thornburg defaulted. Goldman demanded more cash to shore up the account.

...Thornburg officials, however, pushed back on Goldman's request, questioning the values the firm put on Thornburg's portfolio. "When we tried to negotiate price, they argued that they were aware of transactions that were not broadly known on the Street," said a former Thornburg employee briefed on the talks with Goldman. "That was their justification for why they were marking us down as aggressively as they were — that they were aware of things that others were not."

Even as Goldman pressured Thornburg for cash, a Goldman banker pitched Thornburg to hire the firm to help it raise new funds. Thornburg turned elsewhere.

Seeming to lay some blame for the Santa Fe company's collapse on Goldman's machinations, the Times story concludes:

[S]oon after Goldman demanded more funds from Thornburg, analysts began downgrading its shares on news of the collateral calls. Beaten down by the broader mortgage collapse, Thornburg filed for bankruptcy protection on May 1, 2009.

The problem with this story is that

Goldman had a point



Besides which, granting anonymity to presumably high-level employees at a firm whose executives have a

—merely so they can trash another firm—is a

pretty questionable journalistic decision on the Times' part


To be clear, the evidence has piled up that Goldman is indeed the terrible "

" it's been branded. But that doesn't mean the firm's old clients should get a pass just because they've gone broke, and are now willing to trash a former business partner.