Internal Source

Bear Stearns: Where We Are and Some Little Known Facts

I work at Bear HQ. We got ripped off, big time. Gun was pointed at our heads on Sunday night, with no other choice. Think there wouldn't have been other banks or SWFs or private investors or funds interested in buying us for $500m, $1b, at least more than $250m? There were. The so-called "toxic stuff" on the balance sheet is largely US paper such as GNMA, FNMA paper, etc. that should be valued fairly, that is not due to the market's total bullshit collapse in trust.

People are leaving in droves. Headhunters are calling all sorts of people - including in the middle and back office areas such as operations, accounting, execution, etc. Brokers are fleeing for the doors for better names who are still hiring revenue producers. I myself am having no less than three conversations with other names, and I am not on the revenue production side. Will I stay if JPM offers me a job? Don't know, but can't bet on it, so better to get set up and secure and eliminate the risk.

People have to realize that most of Bear was NOT involved in all the "toxic" stuff such as Alt-A or subprime MBS, but most were doing the normal trading of bonds, equities and the rest, like research, etc. that every other bank does. What about all those people who didn't do anything to lead up to this?

Get real people. Not every person in Bear was some 'cowboy trader'. You don't have 14,000 cowboy traders in a firm. More than 60% of those people are in support functions and didn't take a sliver of risk of anyone's money or capital. Many had small salaries and bonuses (in the world of the Street) of, say, 60k base, 20k bonus, some in shares - not every person was some MD with a multi-million-dollar package - so all the vitriol being spewed at the firm fails to take into consideration the "everyman" at the firm.