September 17, 2007 (LPAC)--Quarterly reports from Lehman Brothers and Morgan Stanley are due on Tuesday, Goldman Sachs and Bear Stearns on the 20th. The tea leaf readers are already nervous. Goldman Sachs' numbers will look great, they say, up 33%, but that is only because of a sale of Horizon Wind Energy "power" company. Their #1 fund lost 22% last month, and they are looking at $1.6 billion in investor withdrawal claims, which could sink some funds completely. BS (Bear Stearns) is expected to report 41% drop in earnings, MS an 11% drop, and Lehman Brothers is likely to be down 5.1%. Asset-backed earnings were down 36% overall, and LBOs, which had generated $8.4B in the first half of the year, collapsed completely in August. This is all from a survey of analysts done by Bloomberg.

Of particular concern are the figures for leveraged buy-out leader Lehman. If the analysts are right (and their track record is not that great here), it could be their worst year-on-year earnings decline for Lehman since the second quarter of 2005. Lehman has fallen 24% so far this year, which would be the firm's steepest drop since it went public in 1994. Goldman has fallen 4.4%, the biggest decline since 2002, and Morgan Stanley is down 2.2%. When Goldman's fluke increase is excluded, "it becomes the biggest drop since the fourth quarter of 2001," according to Bloomberg.