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    • Mon Mar 24th 13:44 PM | Rating: 0 0
      Commented on:
      Recession? I've Got a Solution
      Interesting and thoughtful article. I'd like to see more like this that talk intelligently about the economic details.
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    • Tue Mar 18th 05:43 AM | Rating: 0 0
      Commented on:
      In Defense of Jim Cramer on Bear Stearns
      There are two different things getting mixed up here; BSC as a depository and BSC as an equity investment.

      Bear Stearns is a bank that among other things holds deposits for customers. The deposits are insured up to a point by the government..."Rem... FDIC"...so deposits up to $100,000 are insured regardless of what happens to the bank, i.e., bankrupcy or takeover.

      BSC is also a publically traded equity. Someone can have $100,000 on deposit at BSC and at the same time own $100,000 worth of its stock. If the stock goes bankrupt, the $100,000 on deposit is safe because it is insured by the government but the $100,000 investment in the stock would be mostly lost assuming the company doesn't emerge from bankrupcy and very little cash is left for shareholders upon liquidation.

      It sounds like what Jim Cramer was saying on March 11th is that investors should not make a run on BSC and remove their deposits. Of course if a depositor had more than $100,000 in the bank ($250,000 for an IRA - see en.wikipedia.org/wiki/...) they could lose the balance above that amount. I don't think his advice to "not take your money out" was a reference to investments in the stock.
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