Fresh from its defeat to acquire ABN Amro, Barclays is now seen as a possible suitor for troubled Bear Stearns. Bear Stearns has said it doesn't need an outside investor, but it has also hinted it would talk to the "right partner." "Barclays could say [to its shareholders], 'We didn't get that one, but this one's better'," said Richard X. Bove, an analyst at Punk Ziegel.
In the past, U.S. investment banks have put a halt to overseas expansions and slashed European staffs during times of market turmoil. This time around, however, banks are responding to the mess in the subprime-mortgage market and ensuing credit crunch by leaning on their European operations.
Bear Stearns, which saw two hedge funds collapse and a dramatic slide in earnings this summer, said it would lay off 310 workers and combine its two mortgage businesses. Meanwhile, Credit Suisse said its mortgage-market woes could linger for up to 18 months. The credit crunch has pinched a crucial Wall Street profit source.
For the first time in four years, the Securities and Exchange Commission, in fiscal 2007, has increased enforcement action. Cases against individuals and companies rose 10% for the year ended Sept. 30. Increased filings could take congressional pressure off of SEC Chairman Christopher Cox.
Sanford I. Weill, the legendary former boss at Citigroup, said he thought the folks calling for a breakup of the financial-services giant -- people such as Second Curve Capital's Tom Brown -- were "off their mind."