The time has come for all the bad links to go and burn in hell. Not only that, they’ll come back and drag you into it too.
This blog post from one of a few decent digital agencies out there explains pretty much what you could’ve done that you haven’t done that you should’ve done: http://www.aimclearblog.com/2013/05/20/why-seo-link-builders-are-dead-without-paid-organic-social-content-distribution/
The official update from SER is here.
Deep dive into analysis by Glenn Gabe, definitely a recommended read:
Let’s go sleep now and wake up tomorrow to many green arrows pointing north. [I'll update this post once more information on the update is available to me]