In the annals of investment banking, Goldman Sachs (NYSE:GS) deserves a chapter all its own. Seldom has a company been so reviled, admired, envied, and even feared.

Love it or hate it, there's no denying Goldman is a force to be reckoned with. When these guys predicted that oil would surge to $100 and beyond back in '06, many Fools laughed. The laughing stopped when oil proceeded to do just that. And when Goldman followed up its $100 prediction with a call for $200 oil just two years later, not only did no one laugh -- investors actually bid up oil futures, helping Goldman to fulfill its own prophecy. (Almost.)

Whatever you think of Goldman qua Goldman, it's clear that this banker's opinions move markets -- so even if you don't agree with Goldman, it's worth keeping an eye on what it's up to. And this week, Goldman's busy pushing around its fellow banking peers, with a none-too-subtle jab at the stability of the U.S. banking system.

Making news and moving markets
You might think the recent capital infusions at Bank of America (NYSE:BAC), Wells Fargo (NYSE:WFC), and Citigroup (NYSE:C) were a good thing. After all, if the banks are getting out of hock to the U.S. taxpayer, that means they're strong enough to stand on their collective six feet, right? Wrong.

Or at least, partially wrong-according-to-Goldman, which argues that by selling stock ... to raise cash ... to repay TARP ... these banks will hurt earnings for their common shareholders. Which is interesting, because I don't recall Goldman raising any such objections when it agreed to pay Berkshire Hathaway (NYSE:BRK-B) loan-shark rates for an analogous preferred share bailout earlier this year, or when it subsequently rolled back its own TARP funding just in time for bonus season.

Goldman further warns that based on its analysis of past recessions, we're in for additional bank failures -- a lot of them, amounting to about 3% of the U.S. banking system's total assets.

Who's next?
Now before you go panicking and rush to withdraw the kids' college funds, Goldman is not saying that B of A, Wells, or Citigroup are going under. To the contrary, while criticizing the effect of stock dilution on shareholder earnings, Goldman admits that capital infusions at the big banks will greatly strengthen their balance sheets, boosting tangible common equity to a post-crisis high of 5.8% on average.

Smaller banks, however, could be at risk. And sadly, it's these same small banks who receive less analyst coverage, and are therefore more likely to collapse without warning ...

Gee whiz. Any more good news?
Actually, yes, there is. With their balance sheets bolstered, Goldman sees the big banks (at least) returning to the business of ... banking. Whereas these banks have mainly been focused on reducing obligations as they navigate the credit crisis, Goldman believes that we're getting awfully close to an inflection point in the business cycle today.

Banks' loan volume, which was still declining as recently as last quarter, is now roughly flat. Historically, it takes a year or three after the economy bottoms for loans to begin growing again.

A Foolish suggestion
Now, don't just rely on Goldman. While the megabanker enjoys a good reputation among retail investors, there really isn't much of a public record available to back up that reputation. In short, use Goldman's arguments as a data point, but look at others as well.

For example, economic bellwether FedEx (NYSE:FDX) reported earnings last week, it termed the economic recovery "modest." Some pundits argue that FedEx was playing it coy, and even "grossly underestimating" the pace of the recovery. My advice: Keep a sharp eye out on Groundhog Day, when FedEx doppelganger UPS (NYSE:UPS) reports its earnings. Doublecheck how well UPS's report tallies with Goldman's predictions, and how it stacks up against the "gross-ness" of FedEx's modesty as well.

Or to paraphrase a certain President: "Trust Goldman, but verify."

Fool contributor Rich Smith does not own shares of any company named above. The Fool has a disclosure policy.