Investors are getting a little finicky

This was one of the worst weeks for banks and the market that I've ever seen. First-quarter earnings were terrible, and few people are optimistic about next quarter. It looks as though the credit crisis still has a long way to go. Oil is more than $140 a barrel, and parts of the market are reaching new lows. Either this is the low point, or we should prepare to endure a crisis of greater magnitude than we expected. Here's what's going on.


Investors are getting a little finicky about throwing additional billions at subprime-infested banks. While capital-raising efforts appear to be continuing, big banks are facing increasing difficulty finding willing investors, who are losing money on past offerings and are far less eager to continue throwing good money after bad. To give banks more access to more capital, the Federal Reserve is thinking about easing restrictions on private-equity firms in regard to their investments in banks. Large investments in banks from private-equity firms typically result in accompanying regulatory scrutiny, which private-equity firms hate. So the Fed has hinted that it's willing to find ways around some of the restrictions.