Ctrl BG: A Shortcut to Financial News 12/14
A very good example of this trickling effect, would be GMAC the auto financier, which just got approved to become a bank holding company last week. Unfortunately, becoming a bank holding company is not as easy as GS and MS makes it out to be and they're struggling to raise the capital needed to do so. They are trying to renegotiate with debt holders to swap the debt for a smaller amount of debt, cash and preferred shares. If this doesn't work then they are highly likely to go into bankruptcy.
The other big news this week was Bernie Madoff $50 billion fraud. This former chairman of the NASDAQ stock market and Wall Street legend, is allegedly the perpetrator of a $50 billion giant ponzi scheme. According to Wiki, a ponzie scheme is a fraudalent investment operation that pays abnormally high returns to investors using the money coming in from subsequent investors. Apparently lots of the super wealthy have been fooled by this scheme. It is amazing how much you can get away with, with a good reputation and an affable character!
It appears though that the markets is already immune to these scandals, because the markets ended (by a tiny bit) up this week!