The Lesson of Bear Stearns
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.
Panic is old hat on Wall Street. Rarely before, however, has there been a crisis so comprehensive as this one. It first materialized last summer in the shape of a disturbance in the low-rated, or subprime, mortgage market. “Contained,” the regulatory establishment hopefully pronounced. But it has blazed across markets and time zones, with central bankers, politicians, and Treasury functionaries in hot and, to date, futile pursuit.
What makes these proceedings so frightening is that not only is credit in crisis but so, too, is money. There are well-founded doubts about the promises to pay money and about the nature and integrity of the dollar itself.
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