Skip to main content

Charlie Gasparino: Bear Was Going Down Before The Rumors About Bear Going Down Started

  • Author:
  • Updated:

Perhaps in light of the recent discussions about rumor mongers being sent to pound-me-in-the-ass prison for their supposed role in spreading falsities about Bear Stearns, Charlie Gasparino reports that two of his hedge fund sources-- who were not short BSC but prime brokerage clients of the bank-- started to lose confidence in the place way before the "liquidity issues" chatter began. One of them began creating custodial accounts the Friday before the rumors started, and the other had done so by Tuesday. In short, the rumors followed the run on the bank rather than the run following the rumors. This sort of behavior-- the manifestation of a lack of trust in Bear's ability to keep things together-- seems to have begun at least as early as December, and maybe had something to do with the two fabulously named hedge funds imploding, the guy in charge of them writing movie reviews, Jimmy Cayne going to 8-week long bridge camp, and the patrons of the 24th floor men's room's unfamiliarity with "the fundamentals of good hygiene" being signs that wheels were coming off.