What was wrong with the Abacus deal, in that sense, wasn't that Goldman thought the housing market was in trouble.

JAMES SUROWIECKI: In a case where Goldman is playing the role of market-maker, which often tries to do in a deal like the Abacus deal, Goldman is the House.

JAMES SUROWIECKI: Well, I do think the key issue in the Abacus deal has to do with the potential deception (or omission of material information).

(Felix Salmon offers a clear explanation of the way Goldman seems to have misled just about everyone on the wrong side of the Abacus deal.)

By failing to disclose Paulson's role in picking the subprime bonds that underpinned its now notorious Abacus deal, it made an error that has already cost it more than ten billion dollars of market capitalization.

In return for arranging the Abacus deal, Paulson paid Goldman a fee of $15 million, which on Wall Street is pocket change.

Would you do the Abacus deal again?

They know the bank they're trading with may be taking the other side of the trade (in the Abacus deal, for instance, the flipbook said that Goldman might be short the securities).

But I really think it's the wrong way to frame the story of the Abacus deal, because it sets up a false dichotomy.

The Securities and Exchange Commission, in its investigation into the notorious Abacus deal, has already trawled through the first area and evidently decided that it couldn't make the charges stick in court.