Absent Rears
For those who've been playing the anagram game the past couple of days (thanks to Alphaville and Paul Kedrosky), you'll recognize that as a scrambling of the letters in Bear Stearns (NYSE: BSC).
There's not much else one can do while watching the venerable Wall Street firm implode. It reminds me of the jokes that a friend during the last days of watching the firm he worked at (Drexel Burnham Lambert) fail. One that I recall was that there was a chance that a Japanese firm might swoop in to rescue the firm. The punchline was the new name "Nomura Drexel". Of course, a few days later there truly was no-more-a Drexel.
And now, there's little left of Bear. The stock closed Thursday at $57, Friday at $30 and now it appears that JP Morgan (NYSE: JPM) will buy the firm for about $2 per share.
The anagram here is truly apropos. One wonders who was managing risk at the firm. As Roger Ehrenberg posits, it's doubtful this could have happened when Ace Greenberg ran the firm, as he was "all about managing risk". One can imagine that there were several "memos from the Chairman" over the years that reminded his team to never put the firm at the mercy of its creditors. Deal Journal notes that chairman Jimmy Cayne (best known, perhaps, for his extracurricular habits) was playing bridge in Detroit while the firm fell apart. Meanwhile, by the time that Alan Schwartz took the helm at Bear, things were probably too far gone to repair.
The speed at which events have unfolded this week at Bear is much faster than we'd seen in the past. In a strange way, there are parallels to the Spitzer situation where the timeline from news break to resignation took just a few days. As Fred points out, the best place to gain insights during these rapidly changing stories, is among trusted blogs. The major newspapers had strong coverage of both stories (and, in the Spitzer case, it was the New York Times which broke the story) but the blogs were the place to keep up with the latest events.
For more details and links on the Bear story, check Research Recap, Kedrosky's Infectious Greed, FT Alphaville, Barry Ritholtz and Nouriel Roubini. Oh, and I'd guess the WSJ, FT and NY Times will provide coverage as well.
Comments