Financial Meltdown

Well, things are going from bad to worse. The market lost 500+ points yesterday with the news that more banks are going belly up. The entire point of bailing out Behr-Sterns was to prevent Washington Mutual and Lerhman Brothers from failing, which is what they are on their way to doing.

And even worse is AIG failing. From this:

If AIG were to fail, the global ripple effects would be unprecedented, said Robert Bolton, managing director at Mendon Capital Advisors Corp. It has $1 trillion in assets and operates in 130 countries.

[...]

"If AIG fails and can't make good on its obligations, forget it," Bolton said. "It's as big a wave as you're going to see."

What does this all mean? It means the S&L crisis of the 80's will look like peanuts compared to this. There is a possibility, and getting stronger, that we are just at the tip of the iceburg as far as bank failures go.

Buckle your seat belts, it could get awfully rough.