Reuters UK – "Does anyone know what is happening with the markets?" former U.S. Treasury Secretary Lawrence Summers asked after stepping out of his car and into a hedge fund industry conference in Connecticut on Tuesday.
And he wasn’t the only one wondering.
As Summers, now a managing director at hedge fund DE Shaw, and hundreds of managers and investors scanned Blackberries for prices and dialled cell phones for updates, the words Morgan Stanley American International Group tripped off dozens of tongues and faces went pale.
Only one day after watching financial markets tumble as Lehman Brothers Holdings hurtled toward liquidation and Merrill Lynch stunned investors with a surprise sale to Bank of America Morgan Stanley’s share price tumbled but its CFO declared that things were getting out of hand.
AIG’s shares sank 48 percent after the market closed as the insurance group struggled to get the funding it needed to survive.
"I would describe the mood here as a little bit wary," said Raj Mohamad, who travelled to the two-day conference from Singapore where he helps U.S. hedge funds find Middle Eastern investors as Managing Director at Five Pillars Pte Ltd.