Wednesday, June 4, 2008

Wall Street’s Graveyard

Bear Stearns was not the first firm to implode and float belly up on Wall Street. takes us through the colorful history of other firms that have gone kaput since 1970.

Greed and lack of risk control is not a new story. However the danger in the modern era is that many of the firms are built on a mountain of derivatives and the collapse of one can lead to a cascading failure of others. Increased regulation of the derivatives market is needed to prevent this type of event.