tag:blogger.com,1999:blog-3782644139927778760.post-58365405915790282092008-03-25T14:53:00.000-04:002008-03-25T14:53:00.000-04:00SK-<BR/><BR/>While I'm sure BSC people feel slighted, they're way off base for two reasons.<BR/><BR/>Firstly, the Fed didn't have it in for them. They were just the first IB to fail, and thus forced Fed action. The Fed did their best to put in place a guarantee ASAP (the main reason they went to JPM was because it was logistically easier to go through a regulated bank than spend a few days figuring out how to bail out BSC directly). If Lehman had failed before BSC, then they'd be the one facing BK, while BSC would have been saved. If BSC feels they were wronged, they should ask themselves why they were so incompetent that their IB went belly up first while others managed to hold on. That's the real reason for their current predicament.<BR/><BR/>Secondly, BSC shareholders should be thankful that they're getting $10/share. If it wasn't for the Fed, they wouldn't even get that. I'm still of the opinion that the Fed should have done nothing and let them go all the way to bankruptcy (even if that means Lehman and others would have quickly followed suit). BSC's problems have been known since last summer. Their stock price had already fallen significantly by the beginning of this year. If you still had BSC stock, you weren't some poor investor just trying to park your 401k in a safe company with no clue about the underlying turmoil in the company. You were a vulture investor speculating on distressed equity for a big payout. Such speculators should be thanking their heavens they're getting $10/share instead of the $0 that is their rightful due.Lunehttp://www.blogger.com/profile/07474032876924494925noreply@blogger.com