Top Firms Accused Of Playing 'Financial Russian Roulette'

Gold Revolver

Here are some of the sound bites from the Bear Stearns / Financial Crisis Commission Inquiry Wednesday.

'During the week of March 10, 2008, brokerage customers withdrew assets and counterparties refused to roll over repo facilities. These events resulted in a dramatic loss of liquidity. The market's loss of confidence, even though it was unjustified and irrational, became a self-fulfilling prophesy'.

'In my heart I believe something was going on....Rumour, innuendo. I'm not going to use the word 'conspiracy', but it's part of it....I heard the same rumours that everybody did - that hedge funds had gathered together....It was all part of a picture of a big, bad goose walking down a lane that's about to get eaten up'.

'The outcome (Bear's takeover by JPMorgan Chase) was the best that could be anticipated when the world ended for a lot of us'.

'Subsequent events show that Bear Stearns' collapse was not the result of any actions or decisions unique to Bear Stearns. Instead, it was due to overwhelming market forces that Bear Stearns, as the smallest of the independent investment banks, could not resist'.

Jimmy Cayne, former Chairman & CEO, Bear Stearns

'I have given much thought to the events that led up to that fateful week in March 2008, and believe that we took all the appropriate steps that we could to try to survive the storm that was breaking upon us'.

Alan Schwartz, Bear's last CEO

'There's a form of financial Russian Roulette that Bear Stearns was playing, along with other investment banks'.

Phil Angelides, Chairman of the Financial Crisis Inquiry Commission, on the subject of leverage and funding

'That was the business. That was, really, industry practice. In retrospect, in hindsight, I would say leverage was too high'.

Jimmy Cayne

Sources - Bloomberg TV, CNBC,  The Guardian, The New York Daily News, The New York Times, The Times,

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