March 27, 2008

March 27, 2008—The past ten days will be remembered as the time the US government discarded a half-century of rules to save American financial capitalism from collapse. WSJ A1

--On March 11, amid rumors that Bear Stearns Cos. Was in trouble, SEC Chairman Christopher Cox said he has “comfort” with the amount of capital held by five of the largest investment banks, including Bear Stearns. Two days later, Bear sought emergency funding from the Federal Reserve. By March 16, the following Sunday, the brokerage firm had been sold to JP Morgan Chase & Co. in a government-backed fire sale. WSJ A6

--Iraq’s prime minister gave Basra gunmen and ultimatum. ... The violence raises the prospect factors credited for security gains may be evaporating. ... WSJ A1

--An assault by thousands of Iraqi soldiers and police officers to regain control of the southern port city of Basra stalled Wednesday as Shiite militiamen in the Mahdi Army fought daylong hit-and-run battles and refused to withdraw form the neighborhoods that form their base of power there. American officials have presented the Iraqi Army’s attempts to secure the port city as an example of its ability to carry out a major operation against he insurgency on its own. A failure there would be a serious embarrassment for the Iraqi government, as well as for American forces eager to demonstrate that the Iraqi units they have trained can fight effectively on their own behalf. NYT A1