14,000 Bear Stearns employees. 100% of them took a combination of wage plus stock options as compensation for their work. 7,000 will be laid off and ALL of them have experienced a 90% decline in their net worth and 401Ks. Not all these people are big corporate jocks. Some of them are middle managment and some are entry level clerks. All have suffered.
However, if Bear hadn’t been “sacrificed” in this manner, there would be much more than 7,000 financial market employees affected by the bankruptcy/folding of Bear Stearns. At risk were all the other financial institutions like Lehman, Goldman, Merrill, etc. Estimated about 100,000 employees.
Now, having said all that… it does give me pause that the Fed went all out to save the big 6 remaining investment houses and 100,000 employees, but so far remain cold to the fate of 2 million distressed homeowners?
If the Fed would stop lowering rates, RAISE the rates and in turn return some value to assets like real estate, then perhaps the 2 million homeowners would face a far better financial picture. Obviously, without the powerful lobby of the banks, the Fed is hard pressed to do such a thing for homeowners.
