It’s my pleasure to introduce you to Fe Bongolan, my writing colleague and longtime Planet Waves reader. Fe is one of the most politically aware people I know, and I’ve asked her to join us among the Planet Waves bloggers to help cover the delicate election of 2008. Today she is offering her thoughts on the failure of two of the most powerful investment banks in United States history, Merrill Lynch and Lehman Brothers. She lives and works in San Francisco. You can reach her at editorial -at- planetwaves.net. — Eric Francis
IF YOU’RE one of those folks who pulls up to the gas station trying to decide whether to fill up or to buy the milk and eggs you need for the week, then the message of today’s news about the Merrill Lynch/Lehman Brothers crisis should prick up your ears.
This week, we’re walking in on the heels of the meltdown of the country’s largest brokerage firm, Merrill Lynch, which had to sell itself to Bank of America for $50 billion in order to avoid bankruptcy, while the fourth-largest investment bank, Lehman Brothers, is filing for Chapter 11.
Now, I am normally not an alarmist, but when the President holds a press conference asking for all to remain calm and continue with confidence that the markets will sort this all out, you’ve got the hint that the sense is as of now, the proverbial merde is hitting the fan.
The chill, from Main St. to Wall St. as well as Pennsylvania Ave., is bigger than what they let on. This crisis has been coming. We’ve seen hints of it this year.