Episode Details

In this episode of pplpod, we examine the spectacular rise and sudden fall of Bear Stearns, the investment bank whose collapse served as the grim prelude to the 2008 financial crisis. Once recognized as one of America's "Most Admired" companies and famously resilient enough to survive the Great Depression, the firm dissolved in a matter of days due to a crisis of confidence and toxic exposure to the subprime mortgage market.

Join us as we break down:

• The Exposure: How Bear Stearns leveraged itself 35.6 to 1, carrying billions in illiquid assets that turned sour.

• The Warning Signs: The 2007 failure of two high-grade hedge funds that signaled the beginning of the end.

• The Fire Sale: The unprecedented weekend negotiations involving the Federal Reserve that led to the firm being sold to JPMorgan Chase for an initial price of just $2 per share—a shocking drop from its pre-crisis high of $133.

• The Legacy: How CEO James Cayne was criticized for being "asleep at the switch" and why this bailout raised serious questions about Fed intervention in Wall Street affairs.