It's possible that Goldman Sachs and Morgan Stanley declare bankruptcy (despite their new status as bank holding companies). This is where things were heading last week before Treasury Secretary Paulson and the rest of the Goldman Sachs golden boys panicked and intervened in the market (in order to save their own pensions and portfolios?) What happens after that? The profitable pieces of these banks get sold off, the trash is dumped in the dumpster where it belongs, and life moves on. Optimistically, perhaps we start focusing on the serious systemic economic problems we face, rather than pretending they don't exist by drowning them in a sea of new deficit spending.
Off topic: It's interesting to speculate whether Lehman Brothers would ever have been allowed to fail if Paulson and his brat pack were LB alumni instead of Goldman Sachs alumni. I guess we'll never know.