What We Didn't Learn From the Bear Stearns Collapse

This weekend marked the 10th anniversary of the collapse of Bear Stearns Cos. The proximate cause of the disaster was a combination of excessive, subprime mortgage-concentrated leverage and poor risk controls. But the overall economic, monetary and regulatory environment were the broader reasons.

On this anniversary, it is worthwhile to review what happened and what lessons were and were not learned. Let’s begin by looking at some of the broadest factors in effect during the pre-crisis era and how they contributed to the collapse.