Insider Trading At Goldman?

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When Goldman turned in it's third-quarter earnings and revealed the the credit-crunch was its friend, several eyebrows were raised by market watchers. How could Goldman have made the kind of money it claimed to have made by shorting subprime mortgages, more than person we spoke with asked.
Apparently, the same question is being asked over at the Securities and Exchange Commission. Writing in today's New York Post, John Crudele reports that the SEC is "curious" about whether Goldman's traders were tipped off by the firm's investment bankers, giving them an edge on the market. Interestingly, there seems to be some debate within the SEC about whether or not such tipping would constitute insider trading. We assume the crux of the matter is the technical legal question of whether the notoriously conflict-ridden Goldman could ever commit insider trading. If your clients already know you are on both sides of every trade, can you really be convicted of misappropriating from them?
We'd like to know a question Crudele doesn't ask: what kind of non-public information could have led Goldman to take on those winning positions?

SEC Eyes Goldman Sachs' Good Fortune
[New York Post]

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