Question: Did UAL's billion-dollar drop affect banking?

anildash — Tue, 16 Sep 2008 11:33:02 -0800

Did the United stock drop have any catalyzing effect on other recent collapses?

Obviously, big banks fail because of years of mismanagement, and the credit crunch has an order of magnitude more impact than a single day's blip in even a large company like UAL. But I'm curious if anybody with relevant financial knowledge can identify any connections between the blip caused by the resurfacing of the old Sun-Sentinel UAL bankruptcy story and any of the larger institutions that went from teetering to collapse recently.

Tenuous connections welcome! :)

By: unSane

unSane — Tue, 16 Sep 2008 12:59:26 -0800

I've not heard anything remotely like that. The amounts of money involved in the bank collapses are many orders of magnitude greater than UAUA's market cap, which is under $2bn. The whole episode was corrected in 30 minutes. The plunge certainly showed how tightly wound the markets are and must have triggered a bunch of stop-losses but I don't think it had any long-term effect on LEH, JPM, AIG and the rest.

Comments on: Did UAL's billion-dollar drop affect banking?

Question: Did UAL's billion-dollar drop affect banking?

By: unSane