Wall Street Echo Chamber: Jimmy Cayne Blames The Shorts

Are Jimmy Cayne and Dick Fuld two peas in a pod or what?

Both former masters of former Wall Street investment banks, Bear Sterns and Lehman Brothers. Both, thanks to the financial crisis, former billionaires (well, okay, Dick only half-a-billionaire, but still). And both absolutely, positively sure that it was those damn shorts that were responsible for the failure of their firms! (FT.com)

Mr Cayne, 76, said the lack of an “uptick rule”, which places restrictions on investors betting on a fall in a company’s share price, allowed for a “self-fulfilling precipitous drop that couldn’t be checked”.

Couldn't be checked, Jimmy? Not even by the shorts eventually covering -- assuming they were not of the belief that Bear Stearns was ultimately a big, fat ZERO -- and not even by intense buying by confident, knowledgeable insiders such as yourself, who would know a good bargain when they saw one?

Say it ain't so, Jimmy!

While Fuld was full of piss and vinegar throughout the ordeal, threatening to "burn the shorts" (alas, Dick, it was your shorts that ended up getting singed), Jimmy Cayne looked so tired and depressed today while giving testimony it was a surprise he stayed awake for the whole thing.

Mr Cayne said in hindsight the bank had taken on too much debt.

As we all know, and as Jimmy Cayne is starting to find out, sometimes coming to terms with reality can be utterly exhausting.