Last summer, New York City officials described how the job cuts on Wall Street were happening at a slow but steady pace. "It's like the tsunami is still making its way across the ocean," one official told the New York Times.

The tidal wave is now just beginning to crest. Goldman Sachs, the leader on Wall Street and the one firm seemingly in the best position to survive the financial crisis, is cutting 10 percent of its workforce, or about 3,200 jobs, according to several reports today.

Those job cuts come on top of the tens of thousands of jobs already lost at Citigroup and elsewhere on the Street. Thousands of jobs were lost when J.P. Morgan took over Bear Stearns, and Barclays is expected to eliminate 3,000 jobs as it integrates the U.S. operations of Lehman Brothers. Job cuts of as much as 10,000 are expected from the acquisition of Merrill Lynch by Bank of America.

The New York City comptroller, William Thompson, has estimated that 165,000 private-sector jobs could be lost in the next two years, up from his summer estimate of 85,000. And even that estimate may be too optimistic. More jobs were lost in the market crash and relatively modest recession at the start of the decade.

The fact that Goldman is cutting now, when it did not do so earlier amid the credit crunch, indicates that the firm is becoming more pessimistic about the next year, says Douglas McIntyre on 24/7 Wall Street.

"Goldman must be looking at the next year and seeing a potential compounding of its losses and no recovery in its core businesses. All those poor souls would not be going if the trouble was only likely to last another quarter or two."

Shaun Springer, chief executive officer of Napier Scott Executive Search Ltd. in London, agrees, telling Bloomberg News: "When a lean and mean firm starts trimming, they're cutting into muscle. The fact that they are cutting 10 percent is quite indicative of the fact that there are still a lot of problems ahead."