Washington Mutual fails

Washington Mutual failed yesterday as the financial industry continues to transform. WaMu is the largest bank in the history of the U.S. to fail. The FDIC seized it Thursday night. This company scaved off failure through the great depression but could not handle the 2008 financial crisis. The interesting part is that WaMu was presented earlier in the last few weeks about being bought out by JPMorgan. JP was offering about $4 per share, which was a great deal, but WaMu turned it down. Well then WaMu of course went belly up as there was $17 billion in deposits were taken out in 15 days, making the company insolvent and doomed to failure.

So why did they turn down the offer by JP? They were not being rational. Analyst predicted its failure but those running the company did not want to sell the company sell for what were virtually pennies. They thought they should get a better deal, they were wrong. Now the company is dead and the FDIC offloaded the assets of the company to, guess who, JP Morgan. Luckily none of the customers of the once proud company will lose any money, the stockholders are not so lucky.