Here is today’s list of interesting articles I have read online. Today marks a potentially historic day in the financial markets with the Federal Reserve expected to lower interest rates by a whopping 100 bps. There are still a lot of jitters in the market but a lot of people are pointing to yesterday’s action as a possible bottom in the market. We had every reason to be down 500 points yesterday but rallied instead to close slightly to the positive. When the market goes up on bad news, it is hard to argue the market is still in bear mode. Do I believe we have bottomed? No idea. I do believe that there are a lot of bargains out there and now is a good time to nibble a little more.
Financial week has an interesting piece highlighting how hedge funds, who through the use of massive amounts of leverage may have helped lead us into the current credit cycle may actually be the saviors of the market by stepping up with some much needed capital to shore up stocks and companies.
It could be the hedgies that ride to the rescue
Reuters has a great piece on Joe Lewis (No…not the candy cake) and how he lost over $1B betting that Bear Stearns was undervalued at $100 per share over the past 12 months. He is obviously not happy with the $2 “take under” (some have called it a “steal” announced on Sunday and is likely one of the reasons that Bear is actually trading at $7.30 a share as I write this.
Lewis takes $1 billion hit from Bear Stearns
Following on the Bear trade, Felix Salmon does a nice job outlining why Bear might be worth more than $2.
Why Is Bear Stearns Trading at $5?
Thanks for reading…
Tuesday, March 18, 2008
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