股帝, my answer to your question of cooking the book

In third avenue's letter to shareholders, fund manager Martin Whitman gives reason for BSC's collapse. It is not cooking the book, it is run on the bank. I believe in Whitman's explaination while you are entitled to yours, just wanted to share it with you:

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THE LESSONS FROM THE BEAR STEARNS MELTDOWN

The analysis of Bear Stearns Common Stock (“Bear
Stearns Common”) is simple. Assuming that Bear Stearns
was credit-worthy, Bear Stearns Common was worth well
over $100 per share, even assuming that there had been a
material amount of permanent impairments, e.g., the asset
management business was a disaster area. However,
assuming that Bear Stearns was not credit-worthy, Bear
Stearns Common was valueless.
It turned out that Bear Stearns was not credit-worthy. It is
only being made credit-worthy via its acquisition in a
common stock for common stock exchange by JP Morgan
Chase at a value for Bear Stearns Common of around $10
per share; and the provision by the Federal Reserve Bank
of New York (“the Fed”) of a $29 billion special funding
facility secured by a pool of collateral consisting of
investment grade securities (largely mortgage related),
residential and commercial mortgage loans classified as
performing and related hedges held by Bear Stearns (I will
bet that the vast majority of this collateral will continue to
be performing loans and that the Fed will never lose any
money on this rescue deal).
There probably were a number of financial reasons for the
Bear Stearns collapse. However, it appears as if the most
important reason, by far, was a concerted bear raid
designed to persuade principal customers, i.e.,
counterparties and principal creditors, that Bear Stearns
was no longer credit-worthy. Further, the bears argued, it
was easy, and cost-free, to transfer accounts from Bear
Stearns to Bear Stearns’ competitors. Why take credit risks
with Bear Stearns? Thus, a run on the bank. It seems as if it is now easier, and more economical, to conduct
bear raids than has ever been the case heretofore – even before
1929.
1) There is no longer an uptick rule. Prior to July 2007 and
since the early 1930’s, a common stock listed on the New
York Stock Exchange (as was Bear Stearns Common) could
be shorted only at a price that was higher than the last price
or change of price.
2) There are now well-developed
options markets, where one can
go short without incurring any
material cash outlays – say, buy
put options and offset the cost of
put options, by selling call
options.
3) It is now feasible to sell short
specific indices, e.g., the Markit
ABX.HE, the indices that track
prices of residential mortgages.
4) Perhaps most important, the means are more available, and
more effective than they have ever been, to spread rumors
through new communications devices – the Internet and
business television stations.
One of the important lessons from the Bear Stearns debacle for
TAVF is to avoid owning common stocks of companies where
the businesses need to have relatively continuous access to capital
markets in order to survive as going concerns. It is also important
to avoid common stocks of companies where the customer base
can be lost because of a rumor campaign and where Third
Avenue would suffer losses were there to be a run-off of the
business. With the possible exceptions of CIT Common and
Radian Common, the common stocks in the Fund portfolio do
not appear to be vulnerable to company damaging bear raids.
The holdings in CIT Common and Radian Common account
for less than 1% of TAVF’s assets. Virtually every other portfolio
company whose common stock is owned by the Fund enjoys an
extremely strong financial position.


Here is the whole letter