The New York Times -In the spring of 2007, as the mortgage market came unglued, two Bear Stearns executives shared their growing fears in a series of e-mail messages to each other about the perilous condition of the giant hedge funds they oversaw.
“I’m fearful of these markets,” one wrote.
The other said later, “Believe it or not — I’ve been able to convince people to add more money.” He concluded that “I think we should close the funds now.”
But three days later, the pair, Ralph R. Cioffi and Matthew M. Tannin, presented an upbeat picture to worried investors without disclosing that the two funds were plummeting in value and that Mr. Cioffi had already pulled some assets from one of them.
A little more than a month later, the funds, filled with some of the most explosive and high-risk securities available, imploded, evaporating $1.6 billion of investor assets and setting off a financial chain reaction that has rattled global markets, caused more than $350 billion in write-downs, cost a number of executives their jobs and culminated in the demise of Bear Stearns itself.
In an indictment made public Thursday, prosecutors relied heavily on e-mail exchanges between Mr. Cioffi and Mr. Tannin in trying to paint a picture of fear and desperation inside Bear Stearns as the firm grappled with a crisis that would eventually lead to its end.http://www.nytimes.com/2008/06/20/business/20bear.html?ex=1371700800&en=51a54a4e4568e5d0&ei=5124&partner=permalink&exprod=permalink
