I’ve been trying to make sense–story sense–of the Goldman Sachs fiasco. After all, for years we’ve been saying that you don’t really have a brand unless there is a story that lives alongside the money story and suggests a purpose for the enterprise over and above making money for its owners. But what if the business of the firm *is* money? Does the same principle still apply?

From my point of view, Goldman Sachs used to have a very compelling story that was the foundation of its successful business. The essence of that story is contained in the idea that, in the words of its former senior partner Gus Levy, the firm should be “long-term greedy”. That phrase nicely captured the conflict between self-interest and the interests of the larger community. It suggested that if Goldman put the interests of its clients ahead of its own short-term profit then both would benefit in the long run.

Long-term greedy suggests a compelling story because it gets its energy from the collision of competing human needs and values. It is essentially the story of the marketplace at its best, and suggests a role for the firm as a facilitator of Adam Smith’s invisible hand–bringing needs and opportunities together in a way that magically turns the energy of individual greed into wealth for companies, jobs for workers, and profits for the Goldman partners.

The story of long-term greedy was an important part of the formula for the firm’s success for many decades. The fact that the firm was a partnership, which meant that as a partner you could only really cash in on the firm’s success when you retired, was congruent with the idea of long-term thinking. And the fact that a large number of senior partners went into government service after they retired seemed to support the idea that this story had some redeeming social value at its core.

Unfortunately, today’s headlines suggest that Goldman Sachs is another example of a brand whose very success has led it to outrun its own story. Whether or not the firm has done anything illegal, the crisis has exposed the fact that the firm is no longer living by the values of long-term greedy, and probably hasn’t been living by those values for some time now.

In the old days, Goldman’s reputation suggested that it had a talent for embracing the conflict between self-interest and community interest in smart, creative and authentic ways. Of course, that is not easy to do, but that’s the whole point–embracing an eternal human conflict is never easy, which is why a company that pulls it off with a certain amount of grace and integrity benefits from deep customer loyalty. Goldman’s story made it look like a company you would truly like to do business with, and it suggested reasons why the firm might be better at its business than competitors who were only in it for the short-term gain.

I used to believe that, as a client, I would benefit from Goldman’s superior insight, knowledge and experience if I maintained a relationship with the firm over the long term. Today I believe that Goldman Sachs will value its own quarterly earnings ahead of my interests, just like every other Wall Street bank. The Goldman Sachs brand has lost its golden aura, and with it the prospect of a lot of fee income going forward. That evaporation of trust has already taken with it tens of billions of dollars in stock value.

Interestingly, Goldman Sachs’ fall from grace, from a story point of view, is a function of the shift from *embracing* the conflict to *managing* it. Managing a conflict is usually a polite way to say that a company is ignoring a conflict or pretending that one doesn’t exist. And that is exactly what Goldman was doing in the past few years that seems so sleazy to all of us regular main street types. Goldman was acting as if there were no conflict between maximizing their own short-term profits and optimizing the long-term creation of wealth for their clients, themselves, and the economy as a whole–and they got caught with their hand in the cookie jar.

It’s important to keep in mind that it was not the financial crisis that changed the Goldman Sachs story. The firm made a number of choices about how it pursued opportunities for growth and profit–particularly in the decade since it went public–which gradually eroded the authenticity of its story. But as long as everybody was making money it was easy to maintain the aura of authenticity. What the crisis did was rip away that mask. That’s what a crisis is good for: to reveal the true character of all the players in a story.