And here I thought Bear Stearns was a scrappy mid-major team from the WAC

I haven't blogged anything about this J.P. Morgan-Bear Stearns business, partly because of March Madness and partly because I don't really understand it very well. But even to a economics & finance ignoramus like myself, it seems like an obviously big deal. This paragraph from the linked WSJ article struck me as particularly ominous:

The sale of Bear Stearns and Sunday night's move by the Fed to offer loans to other securities dealers mark the latest historic turns in what has become the most pervasive financial crisis in a generation. The issue is no longer whether it will yield a recession -- that seems almost certain -- but whether the concerted efforts of Wall Street and Washington can head off a recession much deeper and more prolonged than the past two, relatively mild ones.

Yippee!! [/sarcasm]

Comments

[Andrew]

I'd love for the mighty Casey Zak to weigh in on the point, but honestly I don't think that simply avoiding a recession is the worry here. The true danger is that this credit panic will devolve into a crisis and bring much of the global financial system to a halt, the pain of which would be far worse than an American recession. In the mean time, the Fed is playing with fire by cutting interest rates and risking long-term inflation. Any way you look at it, the situation we're in is not pretty.

[Joe Loy]

Andrew, I too had the thought that 'tis time for Mighty Casey to step up to the Plate. :>

"... even to a[n] economics & finance ignoramus like myself, it seems like an obviously big deal."

Brendan, when I was a young man in me prime :} I figured maybe I'd be the Republican candidate for President someday :]. My Path took other Turns (shaddup :) but I'm proud to note that the above analysis proves you are every bit as Qualified as I was back then & as the GOP Nominee Presumptive is today ;>. Granted, McCain is also Eligible (eligible, indeed! twice over! :) but you just mark Electioncycle 2016 on yer kitchen calendar. (Hm? / Nonono: October 30 is irrelevant. 01/20/'17 is what counts. Oodles of Eligibility :) This way here see, you can run on a platform of Change & Hope after 8 dreary years of Business as Usual under the wildly-unpopular Obama Administration. ;]

[lex icon]

And here I thought Bear Stearns was a fraudulent survival hound who filmed fake heroic videos to enrich himself and his posse whilest making the rest of us feel foolish.