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Opening Bell: 3.19.08

NYC to probe if Bear Stearns deceived investors (Reuters)
They probably have to. Before we waste too much breath on this one, wondering what a NYC investigation into Bear Stearns' final days is going to yield, we probably just have to acknowledged that it's inevitable. Now if they try to make a whole lot of nothing, when we can jump up and down or whatnot. Also, the SEC has said it won't rule out an investigation. But again, why would they rule one out so early?
Bear's Run-Up Sets the Stage For Epic Clash (WSJ)
On the matter of the run-up in BSC stock, WSJ is predicting an epic clash, with shareholders set to reject the $2 deal. Of course, this view goes against the trendy explanation that BSC counterparties are buying the shares so they can vote in favor of the deal, knowing that the haircut they take on the common stock will be worthwhile to have their other assets insured. We're not 100 percent convinced by that, but it does make some sense, given that even at $4 or $6 or $8, BSC is pretty cheap compared to the other BSC-related assets out there. That being said: if shareholders were to oppose the deal, it would be tantamount to sedition. Seriously, we're already in uncharted territory, but we'd go deeper into the depths if shareholders thumbed their nose at the Fed. What combination of asset prices can we use to measure the odds of a deal happening at this point?
Asian Stocks Advance Most in Month on Fed Rate Cut, Earnings (Bloomberg)
Between the rate cuts and the bank earnings and good reports from China Mobile and Alibaba, Asian stocks finally turned in a good evening. The Nikkei started to claw back from its harrowing losses, rising 2.5 percent, while the broader Asia-Pacific index was up 2.6 percent. In Australia, Macquarie rose 7.6 percent.
BNP rules out bid for Societe Generale (AFP)
Just so you know, BNP is not going to bid for SocGen. There had been some speculation of a deal, but with SocGen having raised money and BNP not seeing any shareholder value in doing the deal, there appears to be little impetus.

The loyalty bias (Free Exhange)
Some academic analysis of "loyalty bias", ie investing an inordinate share of one's retirement income in the company you work for. Obviously the issue is getting a lot of play, as people sort out the BSC wreckage and see shades of Enron. According to one estimate, this loyalty bias contributes to a 20 percent reduction in income, though we're not quite sure what that means. Is that across the board, or does that just refer to people who exhibit loyalty bias?
Big Payday for Wall St. in Visa’s Public Offering (NYT)
Good for Wall St. that some cash will come in via the successful IPO of Visa. The sale represents a nice windfall for its corporate parents and there's an estimated $500 million in i-banking fees, so that's cool. Our interest: we're sort of nuts for one-letter tickers ("V"). So between this and the recent Netsuite IPO ("N", we're excited to see the alphabet come closer to filing up.
Yahoo Shows Some Leg (ATD)
Yahoo finally decided to fight back yesterday, arguing for the first time yet, why it felt Microsoft's offer for it was too low. It filed a big presentation, saying finances were good, that it had a lot of strategic assets and that Microsoft was simply lowballing it. We're wondering what took 'em so long. The company said it had drawn up this financial projection well before Microsoft's bid: so why not do it earlier, as opposed to doing it as a last-ditch measure, after various other lifelines have proven to be futile. Anyway, we wouldn't be totally shocked if they squeezed another dollar, maybe two, out of old softy.
Re: "Bear Stearns is fine." (CrossingWallStreet)
There continues to be a lot of debate about the Cramer video -- you know the Cramer video about Bear Stearns. The fact that he may have gotten a call wrong is really no big deal to us. Even colossally wrong: whatever. But his explanation that he wasn't talking about the common but about having your money with Bear Stearns as quasi-depositor just doesn't make sense. Some buy it, but, like Eddie, we find it a bit hard to swallow. After all: what kind of Bear Stearns account holder would actually write into Mad Money for advice on that question? Seriously. Beyond that, if he really thought the questioner was jut a depositor wishing to move his money from Bear to some other bank, then why would it have been so stupid to do so. The only "stupid" move you could come up with would be selling the stock at too low of a price. He says he wanted to prevent a run on the bank. If true, we should thank him for willing to be put up with so much abuse in the name of the health of the US financial system.