Opening Bell: 3.26.08

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Hoarding by banks stokes fear over crisis (FT)
This has been a key issue for a long time, but we have to imagine the implosion of Bear Stearns has only made this more acute. By all metrics, banks continue to be stingy over their cash. They won't lend it out, not even to other banks. Borrowing costs continue to rise, even after central bankers make moves to lower interest rates. Eventually, you'd think that they'd be able to make the spread big enough, to make it worthwhile... but when you're fearful that the money will never come home, a few basis points doesn't pay back the peace of mind you get from being solvent.
Wall Street May Face $460 Bln in Losses, Goldman Says (Bloomberg)
Just another estimate for how much there is to lose. Almost half a trillion. Of that, about half of the loss will be from residential mortgages, says Goldman, 20 percent will come from commercial real estate, with the rest coming from other stuff, like credit cards. As the firm said in its report: there is a light at the end of the tunnel. But it's a long tunnel.
Deutsche Bank Says Worsening Markets May Affect Goal (Bloomberg)
This is not exactly a warning... more of a likely warning, as Deutsche Bank says it's going to be tough to reach it's full year profit goal, given the worsening conditions of the market. Or as they put it in financialese, the economy will "adversely affect our ability to achieve our pretax profitability objective.''
Banks Balk at Paying for Clear Channel Deal (NYT)
Shares of Clear Channel were crushed last night, after a WSJ report said its sale was on the verge of falling apart. NYT follows up on the story, adding the bit about Clear Channel and its private equity backers hoping to get the deal done in court, in case the financing banks try to bolt. This seems inevitable. The banks do wwant to run away and they'll invoke anything they think resembles a loophole. The sellers will disagree and either they'll come up with some big penalty or have a day in court.
Big Task: Digesting a Bear (WSJ)
The integration of Bear Stearns and JPM is proceeding apace. As one party put it, it's like they're dating after the marriage, figuring who and what and how everything will work out. JPM has its own security guards decamped at Bear (is that so that its own employees can work without fear of attack?) and top executives from the two parties are in constant meetings. No date yet on an official plan, though it's expected in the "coming weeks" which could mean anything. Meanwhile, two pension funds have sued to stop the deal, but that's predictable, and probably not too worrisome at this point.
Stocks Tarnished By 'Lost Decade' (WSJ)
Not that this is news or anything, but stocks are basically where they were 9 years ago. Stock-wise, it was a lost decade. But economy-wise, it was pretty good, no? Did you have wi-fi 9 years ago? Probably not. Heck, there's a good chance you didn't have a laptop -- possibly not even a cellphone (I didn't). The list goes on... all kinds of items and lifestyle goods that there's no way you had access to 9 years ago, which, in our book, is exactly what we want to see out of an economy. It's worth noting, that for many years during this period, stocks were well underwater. So the fact that we're even back to even, is a reflection more of coming out of the post-bubble hole, rather than the recent slide.


Clinton’s Mortgage Solution: Bring in Greenspan? (Dealbook)
Hillary says that we should bring in the old committee to save the world and replace the new committee to save the world as a means of averting the current financial crisis. Surely she thinks that the heft and gravitas of the old guard, consisting of Greenspan, Rubin, etc. will inspire confidence and do the trick. It's hard to imagine it doing anything but the opposite. First of all, that team bears some blame for the current mess, surely. More importantly, it will basically signal to the world that the current team in place is snoozing at the world, and that there's a need to bring back the adults. That's going to go over great.
Websites gamble on their future (BBC)
A fascinating look at the way web operators are learning to improve customer performance by exploring the nature of how people gamble on slot machines. Unfortunately, at this hour and on this much sudafed (following a deep NyQuil-driven sleep), we're having a hard time understanding what the article is saying. And we've read it three times. So if someone would like to explain it to us in the comments, that'd rule.
Competition for the Field, Sirius/XM and Shelf Space (Truth on the Market)
Antitrust nerds are having a field day with the DOJ's approval of the XM/Sirius merger (still waiting on FCC of course, which is expected to come down in the affirmative any day now). There's all kinds of good stuff in the announcement pertaining to competition, what defines a market, etc. Very juicy if you're into this stuff. A few recent posts have examined this issue of competition. There was some strange wording in the release (even we thought so, with out limited legal knowledge) about the two parties not necessarily being in intsense competition, just because once a listener went with one, they rarely switched over. Didn't quite feel comfortable with that line of reasoning, and apparently neither did some others.
Delaware Litigation Against Bear Stearns-JP Morgan Deal Commences (Conglomerate)
Some more legal analysis: this time on the prospects of blocking JPM-Bear by those pension funds out of Michigan.

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