How the mighty have fallen.
It's purely coincidence that six months after my husband left the firm to move to Israel this giant financial company is on the verge of collapsing.
I never understood Economics. Never will. But it seems to me, and my itty-bitty brain, that the reason for the collapse of this great company is nothing less than greed. Maybe you're thinking, I'm oversimplifying this, but I'm telling you this is what it is.
Sub-prime mortgages. Lend money to a borrower with a poor credit history against the security of the value of his house. Six or seven years ago housing values were soaring. But then the bubble burst, home values went down, interest rates went up and many, many have defaulted on their loans. Have this happen, thousands or hundreds of thousands, or what do I know maybe millions of times over, and you have a situation such as Bear Stearns has encountered.
For the past couple of years Bear Stearns has been having record-breaking profits. We're talking billions. You have the head honchos getting bonuses of 30 million dollars. Expense accounts of hundreds of thousands of dollars, use it or lose it.
Need I mention that Isaac never received a 30 million dollar bonus? But Bear was a great place to work. He worked there for 11 years and grew up in that firm. He worked in the "back-office", in computers. He did really well there and there was some regret at having to leave such a great job. But destiny called, and here we are. Out of Hakarat Hatov (appreciation), I will mention that when our daughter was critically ill last year, Isaac had the full support of his office and supervisor and was paid fully and continuously while we were at her bedside. They were human, and I'm sure that is recorded somewhere in the great Judgment book.
I am sad to see this company be swallowed up by JP Morgan Chase. This will have a huge domino effect on the American economy, which is already reeling from the sub-prime mortgage issue and the price of oil. Isaac has many friends at Bear who will be greatly affected by this. But I can't help but feel that it could have been prevented, if not for the greed.
And the really sad thing is we all know it'll happen again in a minute if there is ?*&$-loads of money to be made.
The Stuff That Lasts, Part Deux
5 weeks ago