MacSeth - 1:32 pm on May 11, 2010 (gmt 0)
As a webmaster I really understand (and feel!) the stress a dropdown of this magnitude can cause.
I can say we encounter the same problems as some webmasters here. In my opinion the main reason for the dropdown can be found in Google's update/new layout.
However there may be some other reasons for the drop (in the Netherlands there is a holiday period the first two weeks of May... I do not know if the same can be said of the United States?!?) which may cause a "extra damage". When this period is over we may see a (small) rise.
Is google taking speed into bigger account? Even after optimizing our website for speed it is quite hard to compete to niches with just a small amount of pages when you yourself have a directory with millions of pages...
We just don't know what is causing this all .. it may be a combination of different factors and the problem is we may never know. What I do know is that if you do NOT know what is happening, it may be wisest to stay whereever you are at this moment. Do not change a quality website because of fear...
To all fellow webmasters who are having this problem right now: good luck and keep the faith. Our sites did not become leading without reason before... we will become leading again (in the future).