Ouch! Stocks tumble like boulders on Lehman Brothers demise and takeover of Merrill Lynch. Here in my home market the S&P/TSX composite index fell 351.76 points or 2.75 per cent to 12,417.82. Down south of the border New York’s Dow Jones industrial average was down 277.97 points to 11,144.02.
In case you missed the news what happened is that Lehman Brothers sought bankruptcy protection while Merrill Lynch agreed to be taken over by Bank of America. Are these the last victims of the sub-prime mortgage collapse? I very much doubt it. In either case I am of the opinion that these financial institutions should allowed to fail. The financial industry’s sugar daddy – The Federal Reserve – should NOT put together any rescue plan at the expense of tax payers who will end up paying for the stupidity and greed of Wall Street.
Here is a quote that summarizes the way I feel about this issue:
“The issue is they made this mess, they benefited from the upside, now they’re paying the price,”
Source: Paul Vaillancourt, director of portfolio strategy at Franklin Templeton Managed Solutions