The SEC released a statement about Bear Stearns:
The Securities and Exchange Commission’s division of trading and markets said that the decision to supply temporary funding to Bear Stearns Cos. (BSC) followed a “significant deterioration” in the bank’s liquidity on Thursday.
SEC officials said in a statement that they had been monitoring Bear Stearns’s financial situation on a daily basis in recent weeks, and had no cause for alarm earlier in the week. …
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There’s lots of talk about what the fate of Bear Stearns will be. Most likely it will be a combination of a sale of some divisions to bidders and the liquidation of lots of assets to raise cash.
So what will they liquidate? How about some energy inventory? Word is circulating among the energy traders that Bear Stearns is selling off its natural gas futures contracts and physical inventory to raise cash. The kings of energy trading reporting at Platts are reporting that Bear Stearns has now gone out and denied the reports.
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$$$ “Help! I bought 3000 shares 4 days and now I am getting these margin alerts?” [Google Finance]
$$$ An interview with Pete Peterson. [Portfolio]
$$$ Tim Sykes goes public under the ticker …
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Nobody is safe: CDS for Berkshire Hathaway
CMA DataVision
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Here is a sample of the news stories we didn’t get a chance to explore in detail this week. As usual, all of them can be found on the Alpha-ticker above or in the news items section of AllAboutAlpha.com (free registration may be required for a few of these).
Morgan Stanley says Alpha/Beta Separation “the way [...]…
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It was a bit disconcerting to hear President George Bush discuss the resiliency of the economy while ten blocks away people were scrambling to figure out whether Bear Stearns is going to be dissolved. We half-wished Bush would actually switch the location of his speech to a Bear Stearns trading floor just so we could see what kind of reception he’d get there.
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Several months ago Bear Stearns blocked employees in its headquarters from reading DealBreaker. They offered us lots of technical excuses for this, including a few that almost made sense, but all of them were lies. Bear Stearns blocked us because we had ticked off the upper levels of its management. They’d probably still deny this if we bothered to ask, but how many times do you need to let someone lie to you before you simply quit asking questions.
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The sky is falling. And it’s raining shares of Bear Stearns all the way down into the storm gutter. Maybe it’s time you started looking for a new job. We spent part of the afternoon combing through our Career Center in search of the most interesting jobs. There are dozens to choose from, all categorized according to specialization. But today we thought maybe some of you on a derivatives trading desk for a certain major broker dealer might need a little something extra. So here’s our Job of The Week….
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The Street.com’s video on what they knew, and when they knew it. Done Law & Order style.
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Jimmy Cayne apparently lost $130 million on paper today alone. In Charlie Gasparino’s words, “The non-executive chairman’s fortune [which was about one billion dollars on January 12, and is now less than 193 million] evaporated.” So much irony there. The saddest part is that right now, Cayne’s off at bridge camp, happy as a clam and without the vaguest idea of what’s going on. Can you imagine the look on his face when he gets home and is told he’s gonna have to start buying generic brand chips? Breaks your heart. And I’m stoned off my ass and feeling no pain, so it’s probably going to feel even worse in a few hours. …
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(March 14, 2008 12:54 PM, by Arnold Kling) Amidst the tawdriness, I attempt to draw a real lesson. Suppose that we define "Spitzer" as someone who believes in……
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(March 14, 2008 12:25 PM, by Bryan Caplan) Last time I checked, there weren’t any ads for popular DVDs in the American Economic Review. But after watching the……
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My girl Meredith Whitney apparently just said “Bear Stearns stock could become worthless.” Obviously she’s feeling creamyourpantstastic right now, as she well should be, and I feel guilty for even thinking this, but is she going to have the time to fuck with Citi AND BSC? I’m sure she’s got it under control and, between us, she’s got these things written way in advance, obit-style but I’m still nervous. I’d hate to see her work to suffer.
Euroland13: $13.8 TeraDollar vs U.S.: $13.2 TeraDollar
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“…let me just say, I am outraged that this woman is getting any airplay. Obviously, I don’t have a problem with her S’in D for money, but this nonsense with her getting a record deal out of it is just plain sickening. The dude to my left, who hasn’t showered in a week, and looks exactly like the guy who had a guest spot on Sex and the City five years ago playing the comic book illustrator Carrie dates who still lives with his parents,…
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Citigroup has been ruled out as a potential buyer of Bear Stearns.
Related.
Who Could Buy Bear Stearns? [DealBook]
How is JPMorgan bringing collateral to Bear Stearns but not being held liable for any defaults on that going to restore whatever confidence people supposedly once had in the firm? Doesn’t JPMorgan’s little agreement with the NYFED sort of undermine the whole thing? Pretend I’m someone who actually gives a shit about this– JPMorgan doesn’t have the confidence to loan Bear outright, but I’m supposed to be like, “You know what? I’m not convinced anyone at BSC would know not to stick their dick in a pencil sharpener, let alone run a profitable company but JPMorgan, who’s not even a little exposed, is telling me everything’s cool, so I’m sold”? On a related note, damn Bear Stearns/JPMorgan for sucking me into this whole story. Earlier this morning I was turning the volume down on CNBC to write about Jacko and actually thought to myself, but what if I miss something important? Sickening. Anyway, here’s a “m…
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A few weeks ago we suggested that the two of you with decent bonuses this year go bid on Michael Jackson’s Neverland Ranch. The estate was set to be auctioned off March 19th, unless Jacko came up with the $24.5 million he owed on the property, which nobody thought he would on account of the fact that he’d blown the extra money he got (by refinancing his mortgage) on pop rocks and an ice cream truck. Having one of DealBreaker’s own move into the place that’d been the site of so many happy memories for the lover o’ children would’ve been the silver lining to a very shitty situation. Guess what though? Didn’t come to that! Page Six reports that Mike just worked out a “confidential” refinancing agreement with Fortress Investment Group and will retain ownership of the place. So much brotherly love today. This is what it’s about people, one entity whose intelligence had never before come into question helping another entity, who should’ve been put out of its misery years ago, hold on for just a little while longer. It’s really quite moving. And get this– we hear that Fortress, like JPMorgan re: Bear, doesn’t even stand to benefit, monetarily, from the deal. Apparently the “confidential” terms of the deal simply require that Jackson perform a few sets at the company’s upcoming family BBQ, and not touch anyone’s kids, which just goes to show you, that guy really does love that ranch….
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NYSE Euronext, the world’s largest stock exchange, plans to enter the fast-growing market for credit default swaps by the end of the year through clearing of over-the-counter contracts.
The move follows the poor performance of CDS products launched over the past year by CME Group and Eurex, the world’s two largest futures exchanges. Both have found banks reluctant to use the CDS contracts listed on the exchange.
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