Lessons from Bear: Avoiding Bear traps

Bear Stearns’ fate is gutting, especially for those who have lost their kids’ college funds or their retirement nest-eggs. Small investors like these probably didn’t have the clout to affect the firm’s fate. But big investors who are now complaining about losing huge sums should have challenged Bear’s bosses while they had the chance. Jimmy Cayne and the rest were detached for months before the investment bank folded. They even did nothing after a mini «run on the bank» last summer. Burnt invest...