Arnold Kling  

Bryan Takes Over the Treasury

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Bloomberg reports,


``The collapse of this deal casts a dark cloud over Wall Street,'' said Frederic Dickson, who helps oversee $25 billion as chief market strategist at D.A. Davidson & Co. in Lake Oswego, Oregon. ``It also sends a message that the government is getting out of the bailout business and makes financial institutions like AIG and WaMu look even more vulnerable.''

Read the whole thing. My guess is that the government is not getting out of the bailout business. You have a session in which the folks being asked to take over Lehman say, "Give us X, Y, and Z, or we walk." The government negotiators think that's too generous. They let the folks walk. My guess is that the folks will come back to the table. Or someone else will come to the table.

It makes me glad I signed up to attend this session. I will be curious what these guys think of what's going down. I have met several of them, but they may not remember.

UPDATE: The Wall Street Journal has some appropriately apocalyptic headlines.

I predict that lots of folks pull all-nighters, and there will be more dramatic developments before the markets open tomorrow.


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COMMENTS (2 to date)
ethics writes:

Trading on WS already started at 6PM EST. We have a 3/4 of the staff already in. Traders are in for the night as well.

Last time I've seen something similar was the crash of 1987.

Dan Weber writes:

If I worked in the financial industry, I'd be putting in 80-hour weeks right now.

Not because I think there's that much work to be done; but because axes are going to fall and people will be laid off, and being seen is a great defense.

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