Monday, August 6, 2007

Heads rolls in the sub-prime business

Bear Stearns president steps down

A top executive at Bear Stearns has quit amid problems brought on by the US sub-prime lending market. Two mortgage funds headed up by Warren Spector collapsed in June as the funds plummeted due to high-risk borrowers defaulting on their mortgages.The collapse of the funds was big enough to set ripples through the financial markets which impacted banking shares and raised fears about a downturn in credit markets.

Posted by denzil @ 11:05 AM (339 views)
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2 thoughts on “Heads rolls in the sub-prime business

  • Haven’t they gone bust yet?

    They are taking a long time about it.

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  • Payback’s a bitch – huh Jimmy Cayne?…..

    “When Genius Failed Rebooted” – Bear Stearns seeks Wall Street backing

    Chapter 10 – “At the Fed 1998” – aka “Now you f**king have some Cayne”

    It was Allison’s meeting now. The numbers men decided to take a poll. Bankers trust said it was in… Barclays was in.
    All eyes darted to the hulking Cayne, slouching next to Spector, his colleague.
    The Bear CEO said, ” We called this morning to tell people we wouldn’t be in”. There was a deathly silence.
    Then in unison, the CEOs demanded an explanation. This only made Cayne more resolute. Bear had enough exposure as a clearing agent, Cayne said. He wouldn’t say more.
    The others thought it ludicrous. Bear was holding $500 million – it was the least exposed. “They’re completely self-interested”. Suddenly these paragons of individiual enterprise seethed with communitarian fervour. Purcell of Morgan Stanley turned beet red. He fumed, “It’s not acceptable that a major Wall Street firm isn’t participating”

    It was as if Bear was breaking a silent code; it would pay a price in the future, Allison vowed.

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