INSTANT VIEW: Spitzer apologizes for "private matter"

NEW YORK (Reuters) - New York Gov. Eliot Spitzer apologized to his family for a "private matter" on Monday but made no reference to a New York Times report that he may have been linked to a prostitution ring.

"I failed to live up to the standards I set up to myself. Now I stand to regain the trust of my family," Spitzer told a packed room of reporters in New York City.

He said nothing about possibly resigning.

Spitzer's aides declined to comment further.

Earlier, the New York Times, citing an administration official, reported that Spitzer had informed his most senior administration officials that he had been tied to a prostitution ring.

The Times, citing a source familiar with the investigation, also reported Spitzer had been caught on a federal wiretap last month arranging to meet a prostitute at a Washington hotel.

The following is reactions to the report and Spitzer's statement from lawyers, analysts and others:

JEFFREY GUNDLACH, CHIEF INVESTMENT OFFICER OF TCW GROUP IN

LOS ANGELES, WHICH INVESTS $160 BILLION

"The guy is a quintessential hypocrite. I would think the markets would rally off this news as it brings some relief to Spitzer's dealing with Wall Street and traders. This stuff seems to happen in bear markets."

JULIAN ZELIZER, PROFESSOR OF POLITICS AND HISTORY AT

PRINCETON UNIVERSITY

"The Democrats want to talk about their two great candidates. They don't want to talk about a sex scandal, and now they're talking about a sex scandal, because this is a dramatic one with a powerful, dramatic figure that is going to be in the news for a while. On that level it's demoralizing for Democrats.

"He was a rising star. Before he became governor he was seen as a potential president. He was seen as a new aggressive Democrat who was picking up on key issues like tobacco and middle class concerns very effectively.

"Whenever you lose a rising star. It's a little demoralizing."

STANLEY TWARDY, FORMER FEDERAL PROSECUTOR NOW AT LAW FIRM

DAY PITNEY LLP IN STAMFORD, CONNECTICUT

"If it's a prostitution ring, and the key thing is if, he could face criminal charges. There's a thing known as the Hobbs Act, which basically is crossing state lines to engage in criminal conduct. There's also money laundering depending on what is happening. It depends what was going on - I imagine there could be state charges too."

DAN FUSS, VICE CHAIRMAN OF THE INVESTMENT COMPANY LOOMIS

SAYLES

"MBIA and Ambac are moving because he's been behind the whole process of getting the New York insurance commissioner to come to a solution quickly for the insurers. This is a scary market. And as to the market impact of this theoretically, Spitzer shouldn't be moving things not one basis point. Practically, this is fear market and the fallout from the Spitzer news has exacerbated it."

BARRY RITHOLTZ, DIRECTOR OF EQUITY RESEARCH AT FUSION IQ IN

NEW YORK

"Get ready for a schadenfreude festival on Wall Street."

TOM SCHRADER, MANAGING DIRECTOR, U.S. EQUITY TRADING,

STIFEL NICOLAUS CAPITAL MARKETS

"If anything, that would have been good news to the market. He's not very well liked on Wall Street.