Wall Street was mauled today by the news that Lehman Brothers filed bankruptcy, Bank of America buys Merrill Lynch, and AIG stock price off 60% on financial market fears.
While I am inherently an optimistic guy, I can't help but equate Lehman to one of the first levees to break during Katrina. After the first couple of levees broke, there was a disastrous domino effect that remains fresh in people's minds today.
So, I am hopeful that the AIG levee is somehow bolstered by the Fed this week. If AIG is spared, what other AIG's are out there that we need to worry about? Hint: look at the companies heavily into Lehman and Merrill and some of the other heavily distressed financials.
If AIG falls this week, then we really may have a Katrina effect on our hands.