ALAN GREENSPAN, FORMER FEDERAL RESERVE BOSS
"We will see other major financial firms fail but this does not need to be a problem.
It depends on how it is handled and how the liquidations take place.
And indeed we shouldn't try to protect every single institution. The ordinary course of financial change has winners and losers."
TERRY SMITH, CHIEF EXECUTIVE TULLET PREBON
"It may be past time to panic already. These are certainly seismic events. I think these moves may be the most intelligent we have seen so far, allowing Lehman to go because of the flaws in it, but simultaneously shoring up the next domino in the chain, Merrills."
JON MOULTON, ALCHEMY PARTNERS
"AIG was until recently the world's largest insurance company. It provides over a hundred billion dollars of capital to banks, and it is in trouble too. These really are unprecedented days. This is not stress testing, this could be testing where the failure point lies."
PETER KENNY, KNIGHT EQUITY MARKETS
"The US financial system is finding the tectonic plates underneath its foundation are shifting like they have never shifted before.
It's a new financial world on the verge of a complete reorganization." PETER MORICI, UNIVERSITY OF MARYLAND SCHOOL OF BUSINESS
"Lehman executives will find it difficult to replicate their generous compensation elsewhere, but the readjustment of banking compensation to more realistic levels and responsible schemes is necessary to return Wall Street to sanity.
Performance-based compensation practices at Lehman and throughout Wall Street, which pay big bonuses when bankers bet right but only imposes losses on shareholders when they bet wrong, has propagated the kind of toxic financial engineering that caused mortgage-backed securities meltdown, general credit crisis, and the near death experience of many Wall Street banks and securities dealers."
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