Bear Stearns Axes Prez Over Fund Fiasco

Subprime woes reach executive suite after hedge funds implode
By Dustin Lushing,  Newser Staff
Posted Aug 6, 2007 5:09 AM CDT
The logo for Bear Stearns is shown at its corporate headquarters in New York, Wednesday, July 18, 2007. Stocks retreated Wednesday after Bear Stearns Cos. told investors there was little value left in...   (Associated Press)
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(Newser) – Bear Stearns has fired its No. 2 and once-likely successor as CEO in the wake of  the collapse of two company hedge funds worth more than $1B, reports the Wall Street Journal. Warren Spector, the most high-profile casualty to date in the subprime-mortage crisis rocking Wall Street, is a mortgage and trading expert who oversaw the unit that housed the two failed funds.

Spector had been criticized for his handling of the crisis, including his failure to cancel a week-long trip to Tennessee to play in a bridge tournament as it was unfolding. It's unclear how effective his firing will be in reassuring investors spooked by the crash; Bear Stearns stock has plummeted 28% since the beginning of June, and dropping 6% on Friday alone.