2. Does Goldman actually lose a meaningful number of customers if this behavior is proven to both widespread and true?

????Remarkably, that's a tough call. After all, there have been rumors for years that Goldman frequently engages in front-running of its own clients' trades -- that is, putting their own interests ahead of their own customers by trading in front of big orders -- but no one has had the guts to come forward and actually accuse them of it.

????One notable hedge fund manager I know took millions of dollars of business away from Goldman because he was convinced they were doing it to him -- but even then, he wouldn't go on the record about it. Most firms will still trade with Goldman, though, because Goldman can get the trades done.

????You just hope you're not one of the ones they're taking advantage of.

3. Are competitors eating this up?

????Surprisingly, no. On first glance, you might think that other Wall Street firms would be chuckling over Goldman's latest public relations flap. To be sure, some will, with jokes flying at rival trading desks. But most don't think all the Goldman-bashing is funny anymore.

????"In the old days, it helped when a great competitor like Goldman Sachs suffered," says a member of the executive committee at one of Goldman's rivals. "Nowadays, it just adds more tarnish to the image of the industry and hurts all of us."

????No kidding: shares of J.P. Morgan Chase (JPM, Fortune 500) were down nearly four percent on the Goldman news, and this only two days after stellar results from the bank.

????Likewise, Bank of America's (BAC, Fortune 500) strong results reported this morning couldn't stop a shareholder exodus; that stock was also down four percent by mid-day. But Goldman once again takes the prize: By 1:00 p.m., shares of the company's stock were down 11 percent.

????Goldman's response has been to quickly bunker up. After the news broke, it put out a one-sentence response reading: "The SEC's charges are completely unfounded in law and fact and we will vigorously contest them and defend the firm and its reputation." It's that last word that means the most.