We are going backwards financially these days. The Dow is back to 2006 prices and not far from 2004 prices.
If AIG files for bankruptcy, it will be a first for sitting Dow Component Companies. That should not be happening.
Lehman employees woke up Monday (if they slept at all over the weekend) to a bankrupt employer. They had received their last paycheck. No longer are we just without Bear Stearns. There is no single 'fall' guy as many around Wall Street expected. If it can happen to Bear Stearns, and Lehman, and basically Merrill Lynch (after Bank of America's offer of $29 per share) are Goldman Sachs and Morgan Stanley next to be destroyed or gobbled up by a bank? My favorite post on the subject of the investment banks today and the future comes from Roger Ehrenberg of InformationArbitrage.com The jist:
"Investment Banking 2.0 will be the re-emergence of the boutique, the focused, nimble, high-touch firm that was the bedrock of capital formation in the early years of the stock market boom. Because these mega-firms being created at the urging of the Treasury are not sustainable. They'll live just long enough for investment banking losses to be absorbed by the commercial bank's larger capital base, after which the best talent will flee for greener pastures."
These are fun days for the mainstream press as they sink their teeth into the action of the day, but it's in the blogosphere that you will find the best discussions on the subject and find personal accounts of the struggles of the people most affected.
I have been writing (blogging) in the financial/stock market space since late 2005 and developed a great list of 'experts' in certain areas. I believe in the 'less is more' theory of news. If I can cull smart minds of a few people that I trust read just about everything, than I can get more done.
1. Abnormal Returns -- The site is very simply a 'link' site to relevant financial articles around the web covering the main subjects of the day. It's a great site that sends you quickly to the best sources -- mainstream and bloggers. They have earned my trust for their thorough, simple coverage.
2. TraderMike -- Mike is a friend of mine that loves the markets and also has a great ability to link to key trading and market articles. Mike also has deeper daily analysis of the market moves. His archives on investing and trading the financial markets and all things trading are second to none in the financial blogosphere.
3. The FLY -- If you want the truth, and you want it delivered in a friendly manner...this site is not for you. My friend 'The Fly' writes in hysterical flurries as he manages money. I am a sucker for a sharp mind and a mean pen and most importantly and honest take on the difficulties of the daily grind of managing money and trading. You might as well get it from someone in the trenches everyday -- someone doing it for a living with a family just like you.
4. Roger Ehrenberg -- Roger spent 17 years in the Mergers and Acquisition business at the big banks and trading derivatives. He was smart enough to get out a few years back and more important for US, blogs about the deep depths of the credit markets, the big banks and investment banks. You get Roger's deep knowledge and that of his rolodex and in times like this, is a great, deep read on the subject of the day -- the destruction of the investment banks.
5. Eddy ElfenBein -- Eddy picks his portfolio every December and stocks with it for 12 months. I don't necessarily agree with the strategy, but it makes for an interesting blog. Eddy has a knack for nailing the stories of the day and has some great charts and links that will make you laugh as well as go 'ah'!
6. Bespoke Investment Group -- At Bespoke I get a visual and insightful look at the market and many 'IDEAS' which in the end is the reason most follow the stock markets.
7. StockTwits -- This is a site I am developing with Soren Macbeth. StockTwits is built on the web 2.0 communication tool 'Twitter' and Twitter search engine 'Summize'. Twitter is a microblogging 'stream of consciousness' feed on thousands of subjects. We are narrowing it down further to stocks. Our goal is to organize the voices of thousands of traders into relevant streams about the hot stocks, industries, stories and traders of the day. Most important is the reputation factor and our editing features. Even more, just yesterday, with Lehman, Merrill Lynch and the stock market on the minds of so many millions of people, you could tune into www.summize.com (twitter search site) and follow the stream of thousands of regular people affected by the big banks. Not just stock information, but life experiences and troubles and thoughts.
If you follow this list of bloggers and sites on a daily basis, you can drill down in 10 minutes or spend the whole day enjoying the financial markets.