It’s clear to me that Bear Stearns is complete toast.

They have just halted redemptions on a third hedge fund. This fund had less than “0.5 percent of its assets in securities linked to loans to subprime borrowers”.

People are losing confidence in the market, and in Bear Stearns in particular.

My prediction: in one year, Bear Stearns will cease to exist. It will either be forced to liquidate, or it will be bought out in a fire sale. I’ve already written a post dated blog post for August 1, 2008 (it’s a year short, but 2008 is a leap year, so it’s 365 days, and August 1 is a nice round date).