All eyes on Goldman and Morgan

New Delhi: With Lehman Brothers consigned to history and Merrill Lynch having sold out to Bank of America, all eyes are on the two remaining big investment banks on Wall Street. The scrutiny intensified after Morgan Stanley shares took a beating on two subsequent days, amidst talk of it being up for sale, while Goldman Sachs shares also nosedived. Analysts feel that both banks are now vulnerable as the markets seem to have lost confidence in the financial foundations on which investment banks are built. They say that the whole business model of a brokerage firm is broken. Professor Nouril Roubeni of New York State University says that ultimately the investment banks will have to merge with the commercial banks, this is in view of the fact that stable funds are a must for a bank to survive. Certainly, banks with access to deposits have a better chance to succeed.