As the credit crisis continues to expand, Wall Street today faces its biggest financial shakeup since the Great Depression. After a feverish weekend in which the U.S. government declined to step in to save Lehman Brothers, and the Bank of America agreed to buy Merrill Lynch, Lehman filed for bankruptcy and President Bush saw the need to address the nation on television.
The world is beginning to process a massive reshaping of Wall Street — and to consider possible ripples to come. Observers are closely watching, for example, giant insurance company American International Group Inc., which is seeking emergency help from the Federal Reserve.
As brokerage executive Peter Kenny told Bloomberg.com, “The tectonic plates beneath the world financial system are shifting, and there is going to be a new financial world order that will be born of this.”
Here is what a variety of news outlets are saying today:
Bloomberg.com: ” ‘Tectonic’ shift on Wall Street as Lehman fails, Merrill sold”
Financial Times (London): “Wall Street crisis deepens”
Wall Street Journal: “Crisis on Wall Street as Lehman totters, Merrill is sold, AIG seeks to raise cash”
BizJournals.com: “Wall Street, White House grapple with aftermath of Lehman bankruptcy”
New York Times Deal Book blog: “48 hours that reshaped Wall Street”
Wall Street Journal Political Perceptions blog: “Political wisdom: Wall Street crisis now is a campaign crisis”
Washington Post’s The Trail blog: “Candidate Reaction: Wall Street Falters”
Financial Post (Canada): “Don’t panic: The rot is being cleared from the system”
CNNMoney.com: “What to do if your broker fails”
Time’s Swampland blog: “Their brand is collapse”
Washington Post’s The Fix: “Analysis: Economic crisis puts candidates to test”