The US Investment banks are bankrupt? Where are you getting this? Most of the banks out there have solid balance sheets, and all of these reported losses are mark to market losses, meaning that until these banks are forced to liquidate these assets, or until they stop performing, they're just hypothetical. Stocks won't finish up on this, as I think the equity markets are beginning to wake up to the notion that everything ain't peachy.
I do think there's something fundamentally wrong with the economy, however, someone had to take the other side of those GS trades. Now we know who.
Of course there have been made mistakes in the past ! But do you want to punish economy for FED´s irresponsible behaviour from the past by irresponsible behaviour in present time ?