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khanan's review
Investment Sector: Equities Submitted by Khanan 
, CEO
at FinGad
8 months ago Tags: bear stearns investment bank Add Tag |
One of the reasons I started FinGad is to get investors connected to talk about events like this. I admit I'm an investor, but don't call myself a pro. This project has been a huge lesson into the investment world and we'll keep that going.
It seems to me that there will be plenty of stories saying that the Fed is helping out the needy and encouraging more risky behavior. Some folks on the Yahoo boards have expressed losing huge sums. Some have responded that they should call the Fed and ask for a 28 day credit line. Argument being the Fed is helping out friends. But joking aside, what really peaked my attention is a WSJ article saying that "If Bear fails, the Fed will take responsibility for the loan." We know the Fed will be responsible, but there is serious consideration that Bear will fail. A company that has been around this long, surviving two world wars, Great Depression is in serious trouble and even may go bankrupt, unless rescued.
Sad to think about how the 14,000 employees are feeling… And the shareholders.
I have been a fan of Marc Andreessen, who way before this event wrote an interesting take on Bear in 2007 here. It was clear Bear had problems then, but could this event have been foreseen?
Appreciate your thoughts.
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