Things got really interesting this past weekend. The investment Bank Lehman Brothers is going down with a knock out blow to its balance sheet in the form of mortgage securities and Merrill Lynch is running for cover by getting bought out by Bank of America while it still has some value on the open market. To Wall Street, this is a crushing blow because 2 of the major players in Investment Banking just got pounded into oblivion in no time flat. I feel bad for the rank and file people who are losing their jobs over this endeavor, as if the collapse of Bear Sterns wasn't enough, 2 more bite the dust! I do believe that the C level execs that get the fat pay checks should give up something since the companies are basically bankrupt or heading in that direction. Where is the fairness that some CEO gets 10-20 million bucks in severance while everyone else is going to lose their job and probably their savings because they were paid in stock as part of their compensation package?
As far as I can see, the fun isn't going to be over just yet with AIG on the brink and WaMu looking kinda weak in the knees. It won't even take a big whack from a stick to bring them down which is kind of frightening. Now the part that hurts me personally is what this is doing to my 401K which is going into the toilet pretty quick as the market loses ground. Kind of pisses me off but there isn't much I can do except pull out and leave it in the money market account or something where it will be semi-safe.
Could all have this been preventable? Who knows! 20/20 hindsight vision is great but for the here and now it doesn't do anyone any good except to become an example of what not to do in the future. This might be a good thing, kind of like when Arthur Andresen got creamed (I didn't agree with that on a personal note, the Houston firm should have been the one that got clobered and not the whole firm) but more regulation will come of this, stricter rules everywhere and the people that will ultimately benefit are the professional services firms like mine. I wonder what company will flounder at the end of the week. Just so long as the Fed isn't propping it up with my tax payer money I couldn't care less for the most part but it will be interesting to see how the market deals with all this change.
As far as I can see, the fun isn't going to be over just yet with AIG on the brink and WaMu looking kinda weak in the knees. It won't even take a big whack from a stick to bring them down which is kind of frightening. Now the part that hurts me personally is what this is doing to my 401K which is going into the toilet pretty quick as the market loses ground. Kind of pisses me off but there isn't much I can do except pull out and leave it in the money market account or something where it will be semi-safe.
Could all have this been preventable? Who knows! 20/20 hindsight vision is great but for the here and now it doesn't do anyone any good except to become an example of what not to do in the future. This might be a good thing, kind of like when Arthur Andresen got creamed (I didn't agree with that on a personal note, the Houston firm should have been the one that got clobered and not the whole firm) but more regulation will come of this, stricter rules everywhere and the people that will ultimately benefit are the professional services firms like mine. I wonder what company will flounder at the end of the week. Just so long as the Fed isn't propping it up with my tax payer money I couldn't care less for the most part but it will be interesting to see how the market deals with all this change.
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