Credit Crisis Crystal Ball: What does it say?

I chanced upon a bloomberg article written in 2007 which sheds alot of light into the Lehman brother debacle and possibly predict "who's next?"

Since as early as sept last year, the bond market already signaled the impeding end for Lehman brothers when bond yields show that Lehman is considered riskier than Columbian bonds. Columbia, based on their credit rating, has essentially has a junk bond status. And yet, lehman bonds were trading at an even bigger credit spread discount against columbia.

As far as I can recall, Lehman has always been a very aggressive and highly leveraged investment bank that did not have a superb credit rating history. Therefore, it comes as no surprise Lehman would be hardest hit and first to fall as a result of the credit crisis.

Ok so now we know "Lehman's kah-put", the multi billion dollar question is "who's next?"

Let's look into the crystal ball called the bond market again:

Hmm, I see a name appearing.....it says Goldman Sachs and.....possibly Morgan Stanley

Goldman last year issued a $2.5b senior debt and the bond market basically considered Goldman's bond no better than near-junk yield despite their AA-rating.

To make matters worse, firms in the limelight now like Lehman, Goldman, Merrill and Morgan Stanley are facing this year almost US$133b of bonds maturing. Merrill had the highest debt due this year at $42b (and as we all know they're in the shits now), next in line is Morgan Stanley at $34b. So could they be next? 

Or perhaps it's Goldman? 

I think now it's not a question of who's in the brink of bankruptcy. It's more a question of who will the Feds chose to bail out. The US have been the world's largest debtor since the beginning of time. Therefore, the Feds will have limited capital to sustain enough life support machines for these financial institutions in ICU now. 

While everyone grapples with this financial tsunami, i think the consensus is that, it's far from over. The cancer has so far only affected Wall Street, it has not even hit the main street yet.