Sunday, March 16, 2008

Bear Market? Can You Bear It? Bear Stearns Virtually Given Away

How little value was left in the JP Morgan rescue of investment banking house Bear Stearns?

At $270 million - - a sum not overly less (heck, maybe with inflation, it's equal?) than current Yankee ballplayer Alex Rodriguez's $252 million deal in 2000 with the Texas Rangers - - the deal even includes the failed firm's Madison Ave. headquarters.

A year ago, Bear Stearns stock was at $170 per share. Today, in its fire sale acquisition by JP Morgan, with government backing - - $2 per share.
Anyone giving Pres. George Bush the news? Maybe he'll suggest we all go shopping. If it helps prevent terrorism, maybe we can all prop up the economy with a run to Target.

Just a few days ago, our fearless leader said the economy seemed OK to him, so we're still shoveling $12 billion a week out to Iraq.

Ah, who needs that dough: the Fed can apparently just print more.

Can you say weak dollar, getting weaker? Can you say high oil prices, sure to spike again and again?

Hold onto your hats and your IRA accounts' equity as the markets open Monday.

At this rate, we'll be lucky to get out of this downturn with only a recession - - which is why I predict you won't hear our radio squawkers yammering too much come Monday about creeping (galloping?) socialism and the Nanny State/Federal Reserve's bailout of Bear Stearns and the US banking system, if need be.

Talk show hosts certainly are a luxury, an afternooon bon-bon, a discretionary item for station owners if shrinking, ad-driven budgets need trims.

The microphone jocks could be replaced in a nano-second with cheaper alternatives: interns, community volunteers, even canned music or giveaway programs, like the repugnant, but free-to-stations "The Savage Nation," with Michael Savage.

So I suspect our radio rangers will applaud, or at least diplomatically stifle any ideological complaints about the Federal Reserve's actions, since our local conservative AM talkers are too old and privileged to enjoy selling pencils or apples on the street corner.

(New York Times banking story details here.)

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