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Field of possible Lehman buyers narrows

JEANNINE AVERSA AND JOE BEL BRUNO

Associated Press

Latest comment posted at 4:56 PM EST 13/09/08

Leading Wall Street executives, top U.S. financial officials meet for second day to save investment bank ...Read the full article

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  1. Matthew D. from United States writes: We need a free market solution. Gov't should not be present in the room
  2. Midtown Bob from Toronto, Canada writes: From bloomberg.com
    ...
    The firm said earlier this week that Richard Fuld, Lehman's chairman and chief executive officer, was granted a $35 million stock bonus for 2007, up 4 percent from last year.

    The company's average pay per employee fell slightly in 2007 as Lehman added workers at a faster rate than it increased compensation. Salary, benefits and bonuses per person dropped to an average $332,470 from $334,246 a year earlier, as the number of employees rose 10 percent to 28,556 from 25,936 a year earlier.
    ...

    I'm happy its not my tax $$ bailing out these bums.
  3. TERRI R from Kimberley, Canada writes: This IS a free market solution MatthewD. In case you didn't notice all of the players in this Lehman Brothers meltdown are the same who orchestrated this whole debacle.
    There is no such thing as free market, there is only, due to the negligence of Government a wild west of power brokers/status quo who want to keep this fallacy going.

    Throw the free market ideology out the window, it is so 1800s robber barons thinking, lets have FAIR MARKET
  4. Canadian Expat from United States writes: Midtown Bob: Umm ... you are paying for this everytime you purchase or consume something (gasoline, coal, wheat) that is traded in US dollars.

    This 'deal' to 'rescue' Lehman has nothing to do with saving Lehman. With access to the Discount Window, they can wind down the company through the bankruptcy process without significant OVERT systemic risk. However, to the dismay of those invited to the 'Weekend at Bernie's' party, this will allow for price discovery and mark to market prices (you know, that event that happens everyday to YOUR investment account balance but not to Citi's, Wachovia's, Wells Fargo, etc.). Since July of 2007, they have been lying and obfuscating ('contained', 'no need for further capital', 'no further writedowns', raising dividends like Lehman did in January to 'get those shorties' and then slashing them just 8 months later, Term Auction Facility by the Fed, etc.) to prevent such an event.
  5. Kevin H from Vancouver, Canada writes: Here comes the 2nd depression......congratulations, history repeats itself
  6. Eric Kirkpatrick from Vancouver, B.C., Canada writes: The U.S. government has been hard pressed rationalizing their recent support of the two mortgage institutions. And would be really in a bind to continue this policy during an election. If a domestic solution can be found you can be sure that somewhere in the background, 2 or 3 times removed the U.S. Government will be there to guarantee support.
  7. Carl Baldin from Canada writes: Midtwwon Bob....couldn't agree with you more. These crooks (not bums) should all get together and with their millions made in bonus/stock options, rescue Lehman....not the Govt.!!!

    White collar crime is going to kill the USA!
  8. Bobby Dang from Canada writes: In the short term, the Feds are likely protecting the finance, insurance, and real estate industry from systemic shock, but the long term looks very bleek.

    i)By nationalizing Fannie May, and Freddie Mac will ultimately put the U.S. taxpayer on the hook for more bad loans, since FMay, and FMac will continue to buy huge amounts of bad loans from the big banks, with the help from the Treasury, so the mortgage market doesn't collapse--but have a soft landing. It's a brilliant strategy to unwind the bubble by distributing the risk and huge debt to taxpayers over the long term.

    ii) From (i)--by propping up an unsustainable part of the market, billions--if not trillions of dollars--are being funneled to very unproductive segments of the market (F.I.RE industry). Therefore, you starve off investments to the productive parts of the economy, which is very unsettling. By doing so, the market becomes hugely distorted, and unstable.

    iii) From (ii) and (i) In order to stave off a deep depression, the Feds needs to create a new bubble. The tech bubble (3- 5 trillion) pop was enveloped in the forming mortgage bubble (10-13 trillion). And it's likely the new bubble (35-45 trillion) needed to absorb the mortgage bubble pop, will be in health care or clean tech--two sectors which can use up the excess capital from the previous bubbles.
  9. Led Zepplin from Canada writes: It is now established that the US government and Wall Street are criminally involved in a global collusion to defraud foreign governments and investors, as well as innocent hard working Americans.

    But amazingly, you notice that every mainstream analyst especially the compliant media in the US and Canada are treating each case as if they were committed by individuals.

    If the conservatives of the Western world want to go after evil and WMDs, they should recognize they are the evil ones with the WMDs.
  10. n l from Canada writes: Lehman Bros. reflects the frustrating and serious state of affairs present in the investment banking sector south of the border. In as much as Canadians are linked to North American financial sectors via NAFTA, it is appropriate to comment on this matter. What troubles me is that parties can profit from these misfortunes via short positioning trading--until this type of financial activity is better controlled to eliminate conflict of interests, I have difficulty accepting solutions to questionable corporate abstract accounting products. Also, Hedge Funds have to be made to follow profit and loss logic-no more off balance sheet events-. Lets hope for the best next week.
  11. A. Nonymous from Listeria Ville, United States writes: I lost all my money gambling, overloaded my credit cards, and can no longer afford gas. I also have a drug addiction, alcohol addiction, and mental illness. I don't want to seek treatment.

    Where is my government bail-out? I want a free house, and enough money so the next 3 generations don't have to work.

    Gimme! gimme gimme!

    Lets all adopt the 'American' way.
  12. Bryan . from Canada writes: It seems kind of strange that John Mack and Thain were in on these sessions. Hopefully they feds will hold firm and stay out of the final deal.

    There are more on the horizons, particularly scary could be AIG.

    That being said, it is normally good to buy when there is blood on the street. JP Morgan loaded up in the 30s. Alot of DD would be needed but I wouldn't mind seeing Royal Bank taking a run at Wamu. They can get it on the cheap and get an instant footprint. BMO has the opportunity to scoop up some assets in the midwest to expand their Harris franchise. Our banks are strong right now and have the opportunity to expand. If they dont do it they cannot use the excuse that they are not big enough and have to merge.
  13. Matt Stiles from Vancouver, Canada writes: It's a slippery slope indeed. Once they used taxpayer money to do the Bear Stearns & F&F deals (they said they didn't, but they will when all is said and done), who couldn't see this coming?

    Lehman, WaMu, AIG (this is the big kahuna), Merrill Lynch, Wachovia, Keycorp, Wells Fargo, GM, Ford. None of these companies will make it out of this mess in their current form.

    But let's not kid ourselves. The path was paved for this back in the 90's with LTCM. All the other businesses saw this and said, 'hey, why don't we be as reckless as they were, make insane amounts of money, and then let the government take us over when it all collapses?' Moral hazard at it's finest.

    Those asking for government intervention for every little problem in the economy are being proven foolish every day.

    Keynes was wrong. The 'managed' economy is broken beyond repair.
  14. Mike smith from Canada writes: Wells Fargo is in definite better shape compared to AIG, Merrill, Wamu, Lehman but again i do not trust any of these institutions balance sheets nor even Goldman and JP. They all unload bad things on to their balance sheet gradually with the vague understanding that good times are not far off that they can cover these things.
  15. Peter Siu from Toronto, Canada writes: Lehman is likely to become history. The matter is, will any firms takeover Lehman because of the clients they have, and if those 'clients' worth to take at a price as expensive as 45 billion assuming the real-estate mortgage sector from Lehman will be written off. US gov't is likely to (be forced to) come out. Lehman is nothing comparing to Fannie and Freddie however people may only see it as a 'routine' if they help every single failure bank out at the end. The concern right now is, will AIG, and Merrill Lynch follow the same path like Lehman? like Bear Stearns?
  16. Art Vandelai from Burlington, Canada writes: According to the article...WaMu is the nations biggest SAVINGS bank?

    Surprised we haven't seen lineups of customers looking to withdraw their funds as they realize that the days of ponzi finance are numbered. Even if FDIC insured, getting insurance takes time...people who need their savings in the short run won't wait.
  17. dave charlston from toronto, Canada writes: Some one will end up buying Lehman similar to what happened to bear sterns. The shares will at least double in price. Hope I get a chance to buy them Monday
  18. J. Michael from Australia writes: Eventually individuals are going to lose substantial wealth over these debacles - the government can only move the chairs on the 'Titanic economy' so many times, before the inevitable.
  19. Silver Standard (Used to be gold) from Canada writes: Just think guys, if we had the Amero and soon with the SPP we can pay America's debts more directly than we already are. We are devaluing our dollar to prop them up and have been since last year.

    Midtown Bob

    It will be our dollars if we even had a currency union like whats happening in the Middle east..check it out.

    http://www.bloomberg.com/apps/news?pid=20601068&sid=azmZqdV4j3Uo&refer=economy

    Lets hope nothing like the Amero ever happens, can you imagine our currency being turned in to toilet paper like the US dollar is now. I really don't care what the market says its worth because we all know deep down this is just a pile of you know what.
  20. D P from Oakville, Canada writes: The only thing that can save capitalism once again is SOCIALISM!
  21. D P from Oakville, Canada writes: The government won't call it a buyout but it is what will be.
  22. Chris Henry from Toronto, Canada writes: It's unfair to call our current system capitalism, it should be called creditism, because there is no capital only credit.
  23. Voice of Reason from Ottawa, Canada writes: I must say that Bush really did a number on his country, all this happened under his watch, he was so preoccuppied overtaking Sadam, that he destroyed his country. Sadam did get his revenge on Bush, and it will come in the way history remembers Bush as president.

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