The Benny (on the) Hill Show

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"These guys aren't stupid," said Joe Saluzzi, co-head of equity trading at Themis Trading, a buy-side advisory firm. "Right now, the first thing they're doing is saving themselves ... someone will fill the void."

Late Sunday, Goldman Sachs Group Inc. and Morgan Stanley said they will become bank holding companies. Everywhere, Monday morning, there were epitaphs for Wall Street.

Goldman and Morgan's "new status reflects a new reality. Investors have lost faith in wholesale funding models," The Financial Times wrote in its Lex column. Regulators insist on "less leverage."

"Goldman, Morgan scrap Wall Street model, become banks in bid to ride out crisis," The Wall Street Journal shouted Monday, adding that the move was "the end of traditional investment banking and ... (the beginning of) stringent new capital requirements."

The "end of capitalism as we know it," MarketWatch economist Irwin Kellner concluded.

Christopher Cox, chairman of the Securities and Exchange Commission, may as well go play a round of golf, if he hasn't lowered his handicap this year enough already.

Filling the void

Wall Street is changing, but not in the way some would have you think. For instance, new oversight by the U.S. Federal Reserve isn't so new. Fed bankers have been on site at investment banks since Bear Stearns Cos. collapse in March. Their presence and influence were part of the deal that gave broker/dealers access to Fed funds.

"It does not mean they are going to be commercial banks, it means they're going to accept the regulatory structure," said Roy Smith, a former Goldman partner, now a professor at New York University. "They have been complying with (international bank) capital requirements for several months."