Spare the Rod: Spoil the Child-

The Child in this case being the banking business/hedge fund business  ( there is so much overlap between the two that it is essentially the same set of risks- especially if you are Bear Sterns.) If only the market would have allowed Long-Term Capital Management to fail.  The market would have swallowed and learned…..It is ironic,  given that Bear Sterns did in fact decline to participate in that bailout ; it was the only major bank who actually did not spare the rod……. If only the other major banks had declined as well- We  would be in nowhere of a mess we are in today and Bear Sterns would be worth more then 2 dollars a share… Historically, in all areas, financial and politics, sports and everyday life-  this is a typical scenerio ; ignore and bailout small problems which in turn create much bigger problems….. I think we can almost all wish today that in fact LTM should have been allowed to fail…..

This entry was posted on March 16, 2008 at 7:24 pm and is filed under Venture Capital. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response or trackback from your own site.

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