Stock Market's Losses Build as Bailout Vote Nears

"Boy oh boy has the landscape changed," said Johnson. By his count, only five major players are left in the financial space: Goldman Sachs (GS Quote), Morgan Stanley (MS Quote), Bank of America (BAC Quote), JPMorgan and Citigroup. "I never would have guessed that."

Johnson said that the spate of consolidation among financial firms is "going to usher in a whole mess of problems, concentration of power being among them. It's only five guys that have to sit down and figure they can rule the world." He said it would be interesting to see whom the Treasury's bailout package helps and what price it pays for troubled assets. "You can bet it's going to be watched carefully," he said.

Meanwhile, Morgan Stanley got a $9 billion investment from Japanese bank Mitsubishi UFJ.

A report in The Wall Street Journal said that private equity companies Bain Capital and Hellman & Friedman were in the hunt to buy the Neuberger Berman arm of bankrupt brokerage Lehman Brothers.

The Financial Times reported that insurance firm AIG (AIG Quote) was contemplating the sale of 15 of its businesses to repay an $85 billion bridge loan from the Federal Reserve and keep from being taken over by the government.

Shares of National City (NCC Quote) were dropping precipitously, losing 42% of their value to trade near the $2 mark as investors feared it may be the next bank to fall.

The credit crisis was also causing turmoil overseas. European governments early Monday arranged rescues of Bradford & Bingley, Fortis and Hypo Real Estate.

Johnson said it's worrisome that the financial crisis is being transmitted to other parts of the world. He said that the globalization of the turmoil means lenders of last resort will now have to coordinate internationally.