Oh Happy Day

After reading an economics news article on http://www.abcnews.com/ that was written by Tom Hays, an associated press writer, I just had to spread the good cheer.

Oh Happy Day, Oh Happy Day, Federal Authorities have arrested 2 Bear Stern Managers. They are being charged with conspiracy and fraud charges in misleading investors adding in the collapse of the Subprime Mortgage Market making this a Happy Day.

Both Mathew Tannin and Ralph Cioffi were arrested at their homes. Tannin was arrested in his New Jersey home and Cioffi at his New York City home by FBI agents. Their arrest came as the result of a year-long-Federal-Securities-Fraud-investigation of the 2 Bear Stern Managers misleading the investors in the risky Subprime Mortgage Market.
The two are speaking to authorities under anonymity due to the outcome of the investigation still pending, leaving me to believe that they will not serve any real time. Tannin's lawyer, Brune, believes in her clients' innocence, claiming that her client is a scape-goat. She is looking forward to his acquittal, while Coiffi's lawyer refused to comment.

The Subprime Mortgages were repackaged and sold around the globe as securities. Bear Sterns collapse revealed the damage that had been done to the companies that had bought, packaged, then sold the loans. In fact the Bear Sterns hedge funds failed way back in June of 2007 although Tannin and Cioffi continued with positive assessments of the loan securities. Before crashing, the loans had more than 20 Billion in assets.

Stating that they were misled in the investments, Barclays Bank along with other hedge fund investors had file a lawsuit last year naming the two, Tannin and Coiffi.

Yet the lawsuit also claims that Bear Sterns itself knew for a while that certain assets in the Bear Sterns high Grade Structure Strategies Enhanced Master Fund were worth far less than their stated values. The portfolio asset values were declining during the same time that Bear Sterns told Barclay the enhance fund was up at 6% percent in June 2007.

The company Bear Sterns itself might had gotten bailed out with billions in tax-payers money it collapsed. But the company has suffered a humiliating loss recently when it was bought out at $10.00 a share, yet their shares were $171.00 each back in January 2007. Oh happy day.

Now, how many more will be named and with what companies since the investigation is still pending?