Strange Times Are Afoot

My clients are mostly financial institutions. I heard rumblings of Bear Stearns' and Lehman Brothers' collapses a while before they happened, so they weren't huge surprises.

I was quite taken by surprise when Bank of America agreed to take over Merrill Lynch this weekend, though. I work quite a lot with ML and hadn't heard anything through the grapevine.

When three of the big 5 "pure" investment banks in the U.S. topple within six months, the financial world is due for some changes. Here's hoping the U.S. government doesn't overreact as crazily as it did to Enron and 9/11. But here's betting it will -- re-election politics almost mandate it.

Now the big question: does this all signal the end of America's financial hegemony?

EDIT: I've posted a few thoughts on the Fed's reaction so far at Heuristic Devices.