It's time to finally lay to rest claims stretching back as far as 2007 that Goldman Sachs was peddling securities backed by at least risky home mortgages while it was secretly betting that the US housing market was in trouble.

Far from being "secretly" down on the US housing market, very early on Goldman was publicly and privately warning that home prices would decline and that this decline would have an impact on mortgage backed securities.

The complaints about Goldman being on both sides of the mortgage trade stretch at least as far back as December, 2007. Ben Stein wrote a column complaining that Goldman had sold mortgage backed securities while it was shorting them. At that early date Goldman economist Jan Hatzius was saying the US housing market would cause serious...