Goldman Sachs left many with puzzled looks on their face today as one of the last colossal investment banks reported a terrible third-quarter. Goldman announced that profits plunged 70% from a year ago as a result of more than $800 million in losses from deteriorating residential and commercial real estate assets. Goldman’s earnings for the third quarter came in at $845 million, or $1.81 a share, compared to $2.09 billion, or $4.58 a share a year ago. Goldman’s investment banking, trading and principal investments divisions were hit the hardest with large double digit declines in net revenues.

 

Goldman Sachs, along with Morgan Stanley, was widely viewed to weather the credit crisis better than any other financial institution. But given today’s results, many believe Goldman may be the next giant to fall.  Morgan Stanley reports tomorrow with many believing they’ll report similar results.

 

As of 2:30pm, shares of Goldman are down more than 5%.