Stephen Foley: So, what 'should we' make of Goldmans?

US Outlook: Bankers aren't chastened or changed, part 2. (It has been a depressing few days.)

Goldman Sachs' business standards committee report was published on Tuesday. No doubt you heard the trumpet from head office at 200 West Street here in Manhattan. And it has a great line in it. The line is this: "Our approach must be, not just 'can we' undertake a given business activity, but 'should we'."

And that's it. A great line. Absolutely nowhere does Goldman Sachs elaborate.

To be sure, there are whole armies of new people being brought in to examine the question, "should we". There will be heightened suitability reviews, new escalation and approval processes, client and business standards committees. But nowhere in the report – and I read it a few times – is there any discussion of how all these people might go about examining the question, in light of what we have learnt from the credit crisis.

We know that bankers have invented lots of ingenious products for avoiding the taxman, hiding your debts off balance sheet, subverting the intentions of regulators, or just for turbo-charging your bets on the financial markets with ungodly amounts of leverage. We know that Goldman has invented a lots of these products and that many got through all its "should we" tests before the crisis (think help for the Greek government to dodge eurozone debt limits). After eight months reviewing its business practices, Goldman published a 63-page report that addressed precisely nothing of substance.

There is only one conclusion to draw from the failure of the review to address what separates "can we" from "should we". It is that Goldman feels it never got that judgement wrong during the bubble, the bust and the panic. It is not a conclusion with which many people outside the company can agree.