There was a domino effect, but a number of banks had the same root problem -- MBS held on their books at higher than their true value. Bear Stearns just happened to have a whole lot of the worst MBS, so it went down first.

In this case, a number of banks are holding a lot of long-term debt as "hold til maturity", so they're not recognizing on their books that it has lost value due to rising interest rates.