Bank of America-Merrill Lynch, a bogus deal?

With Bank of America's stock sinking to 14-year lows, some are starting to question the wisdom of the Merrill Lynch deal. What really made the deal work, one could argue, was the government assurance that it would help defray any losses tied to the deal--quite a revelation in itself. That's coming home to roost now, as Bank of America needs a $20 billion TARP injection to close the deal. 

Fortune notes, "CEO Ken Lewis' decision to buy Merrill isn't the only thing that looks questionable now. So does the advice he and the Bank of America board got on the hastily arranged Merrill deal from its advisers, Fox-Pitt Kelton and J.C. Flowers & Co." They reaped $20 million for a weekend's work on those opinions. It's fair to say the jury is out on the deal. It's also fair to say that Lewis' has invested his entire legacy in this deal.

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