And the financial landscape changes as a result

CREDIT CRISIS HITS WALL STREET

 http://online.wsj.com/article/SB120569598608739825.html?mod=special_coverage

J.P. Morgan Buys Bear in Fire Sale,
As Fed Widens Credit to Avert Crisis

Ailing Firm Sold
For Just $2 a Share
In U.S.-Backed Deal

By ROBIN SIDEL, DENNIS K. BERMAN, and KATE KELLY
March 17, 2008; Page A1

Pushed to the brink of collapse by the mortgage crisis, Bear Stearns Cos. agreed — after prodding by the federal government — to be sold to J.P. Morgan Chase & Co. for the fire-sale price of $2 a share in stock, or about $236 million.

Bear Stearns had a stock-market value of about $3.5 billion as of Friday — and was worth $20 billion in January 2007. But the crisis of confidence that swept the firm and fueled a customer exodus in recent days left Bear Stearns with a horrible choice: sell the firm — at any price — to a big bank willing to assume its trading obligations or file for bankruptcy.

“At the end of the day, what Bear Stearns was looking at was either taking $2 a share or going bust,” said one person involved in the negotiations. “Those were the only options.”

Amazing!

Paul