Students on edge after market disturbances

Uncertainty and confusion over this week's financial meltdown drew more than 1,000 students to Zellerbach Auditorium last night to hear Wharton professors' take on the situation.

Penn students were shocked to hear on Sunday that Bank of America would acquire Merrill Lynch & Co. Hours later, Lehman Brothers Holdings filed for bankruptcy.

On Monday, the Dow Jones was down by 500 points at closing, the biggest drop since the aftermath of Sept. 11, 2001.

The Wharton panel - which featured four prominent professors - sought to reduce some of the panic on campus, said MBA student Jennifer Akpapuna, co-president of the Wharton Finance Club, which organized the event.

"The crisis is obviously at the forefront of everyone's mind at school," said MBA student and Wharton Finance Club co-president Will Hodge.

Panelists discussed topics that included the circumstances that caused the crisis, the responsibility of the Federal Reserve in the situation, and a comparison between the March folding of Bear Stearns Cos. and current conditions surrounding Lehman.

Some experts say the outlook isn't all bad. In a column in yesterday's Wall Street Journal, Finance professor Jeremy Siegel, a member of yesterday's panel, said, "there is good evidence the worst is over."

Siegel says the current financial crisis could have followed the course of the Great Depression. But thanks to a "proactive Federal Reserve and deposit insurance," he doesn't see that happening this time around.

Wharton and Engineering senior Danh Trang said his biggest worries aren't for himself and his classmates.

Rather, he is concerned about friends who recently got jobs at Lehman, which was sold in part yesterday to the investment division of Barclays Capital, a global financial-services firm.

"If we think we have it bad, they have it much worse," Trang said. "At least we know in advance and have the opportunity to explore other options."

One of those students is Wharton senior Doug Kenney, who was given a full-time offer at Lehman Brothers after spending two summers at the firm.

Kenney said that last week, Lehman Brothers assured him that his offer would still stand regardless of the firm's outcome.

He spoke to human-resources people at Barclays yesterday, who indicated his offer would be honored, but it is "not set in stone."

He and his friends are "definitely a shaken-up group of normally confident kids," he said.

But even employees at Lehman Brothers say the situation is not as bad as the outside world may perceive.

"Even up to this past Friday when all the rumors were swirling . I was still very busy with work, so I still had a lot of stuff on my plate," said Wharton and Engineering alumnus Kel Huang, who started working full-time in the Lehman capital markets division in August 2007 and is fairly sure he will retain his job.

There's also optimism among students with offers from Merrill Lynch, who are waiting to hear if their offers still stand.

"Of course there are going to be jobs cut, but I did not get the impression that it was going to be at our level," said Wharton senior Nazli Oguzsimsaroglu, who accepted an offer in the investment-banking division at Merrill but has yet to hear from the company.

These students are not alone in their optimism.

"It is easy to be pessimistic about the future of financial services in the current climate," Siegel wrote in his column. "But objective facts indicate that the future demand for these services will be high."

Staff writer Kathy Wang contributed reporting to this article.

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