Today, an article in Bloomberg gives a run down of the gloom that spread over the Street in recent months, but it also notes the bright spots.
Although most of the largest investment banks have seen their share prices plummet by more than 20 percent, analysts estimate that Goldman Sachs, Merrill Lynch, Morgan Stanley, Lehman Brothers and Bear Stearns will earn a combined $28 billion in 2007, just an 8 percent slide from 2006. Bloomberg also notes that Goldman and Lehman are expected to have record years when it comes to earnings, not to mention that the first half of 2007 was the most profitable six months in Wall Street history, "boosted by record merger and acquisitions, high-yield financing, commodities trading and stock market gains."
Even though the subprime fallout has cost shareholders billions in losses and several CEOs their jobs, many of the biggest banks on Wall Street will still earn billions of dollars in income this year. And some firms will enjoy their best years ever.