# Lehman Brother Holdings faces bankruptcy



## noirua (15 September 2008)

Bank of America and Barclays Bank have pulled out of the rescue of Lehman Brothers, it was announced a short while ago. The bank has involvement in Commercial property.
The US Treasury Secretary, Frank C Bolton, has said that they will not rescue the bank.
Wall Street prepares for Lehman Brothers potential bankruptcy:  http://www.bloomberg.com/apps/news?pid=20601087&sid=aRc5IyxcHIbw&refer=home

Should the bank apply for Chapter 11 on Monday morning in the US then all of Lehman's branches in the UK would immediately be insolvent.


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## mayk (15 September 2008)

Can someone explain the chapter 11 bankruptcy. Will it result in fire sale of all its assets? Because this bank has huge holdings in many resource stocks namely around 3% stake in BHP (reduced from 5%) . Or they will be put under administrative management, which will oversee the sale and subsequent allotment of money to share holders.


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## Aussiejeff (15 September 2008)

mayk said:


> Can someone explain the chapter 11 bankruptcy. Will it result in fire sale of all its assets? Because this bank has huge holdings in many resource stocks namely around 3% stake in BHP (reduced from 5%) . Or they will be put under administrative management, *which will oversee the sale and subsequent allotment of money to share holders.*




But only on the NOT certain assumptions that:

1.   _All the required assets will be sold easily and within necessary timeframes_. Um, in a market where $US Billion fire sales are going off every few days, where are all the keen junk debt buyers going to spring from? 

2.   _The sales will generate enough "emergency" funding to cover all debt and still pay out shareholders_. That is the only likely scenario where unsecured shareholders *might* get some *possibly very small* percentage return on their shares. All major stakeholders, debtors and secured shareholders come first...


aj


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## Pager (15 September 2008)

Well the after hours S&P futures have just opened and they are getting smashed, down about 40 points  thats over 3%, expect the ASX to get a bad start to the week.


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## Kauri (15 September 2008)

The failure by Fed, Treasury and banking officials to come up with 
a sale of troubled investment bank Lehman Brothers has sent the Asian market reeling. The JPY has been bought against the peripheral currencies such as the AUD and NZD that has taken the USD/JPY down 200 pips to 105.90 from the NY close at 107.90. Fears of systemic risk related to the Lehman legs of complicated derivative transactions has the market and investors in full square-up mode and risk positions are being taken off of the table and this will likely continue as the full impact of the Lehman debacle is full absorbed. The uncertainty is likely to keep the JPY extremely buoyant, as carry trade unwinding and safe haven flows should dominate FX trading at this time of extreme uncertainty.


The leading proposal would divide Lehman into two entities, a "good bank" and a "bad bank." Barclays would buy the parts of Lehman that have been performing well, while a group of 10 to 15 Wall Street companies would agree to absorb losses from the bank"s troubled assets, according to two people briefed on the proposal. Taxpayer money would not be included in such a deal, they said. Under that plan, the Wall Street banks would agree to provide up to 30 BLN USD of support to absorb the losses of the bad bank. That is roughly the same amount of money that the government agreed to commit to support JPMorgan Chase"s emergency takeover of Bear Stearns in March. Another option getting discussed would be the orderly liquidation of Lehman"s assets starting as early as Monday. In that scenario, participants in the session might fashion a deal under which other banks would keep lending money to Lehman as its holdings are wound down, sources said. The NY Times article goes on to say that none of the banks involved, however, have committed to any rescue plan, and talks could still fall apart. The talks will take on even greater urgency on Sunday as government officials push for a deal before the Asian markets open on Monday morning. Both Barclays and Bank of America expressed interest in buying Lehman and were negotiating hard, initially insisting that the government provide financial support. But federal officials were adamant that no public money be used   a big point of contention because many of the top Wall Street executives believe that their banks, which have each written down tens of billions of dollars in assets, do not have the capacity to lead the rescue on their own. The prospects of a deal involving Bank of America appeared to fade as talks progressed Saturday and it became clear that the government would not stray from its position.

Slainte
...........Kauri


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## gfresh (15 September 2008)

Seems like none of the others have that much of an interest to buy a near worthless Lehman. Easier to pick off the carcass the pieces afterwards. 

Emergency trading session opened today in New York for derivatives to allow other counterparties to settle/hedge their books again Lehman debt it seems. 

Going to be an interesting start to the week. Some panic I'm sure. 

The question is, how much effect will this have on the other institutions, already hurting, and now about to cop any Lehman securities being next to worthless.

Locally, Lehman I know had issued securities to many of our local councils for hundreds of millions of dollars. Will have to check on what type, but that could be interesting


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## MrBurns (15 September 2008)

Even the great USA cant bail out everyone, this may be the start of what everyone has been dreading, a severe crises in money markets leading to a collapse of the finanacial system.

There I said it.


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## gfresh (15 September 2008)

MER and BAC to merge now? 

---
http://www.bloomberg.com/apps/news?pid=20601087&sid=acZ9mZrN3AOE&refer=home

Merrill Lynch Said to Be in Merger Talks With Bank of America

By Jonathan Keehner and Bradley Keoun

Sept. 14 (Bloomberg) -- Merrill Lynch & Co., the third- biggest U.S. securities firm, is in merger talks with Bank of America Corp., people with knowledge of the negotiations said.

The discussions came as Merrill's smaller rival Lehman Brothers Holdings Inc. moved closer to filing for bankruptcy after Barclays Plc and Bank of America abandoned talks to buy the investment bank and Wall Street prepared for its possible liquidation.

Bank of America spokesman Scott Silvestri declined to comment on Merrill. ``We don't comment on speculation,'' said Bank of America spokesman Bob Stickler.

Merrill and Lehman are based in New York. Bank of America is based in Charlotte, North Carolina.


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## sassa (15 September 2008)

> Lehman Brothers will file for bankruptcy protection on Sunday night, according to people briefed on the matter, in the largest failure of an investment bank since the collapse of Drexel Burnham Lambert 18 years ago.




http://www.jessescrossroadscafe.blogspot.com/


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## noirua (15 September 2008)

MrBurns said:


> Even the great USA cant bail out everyone, this may be the start of what everyone has been dreading, a severe crises in money markets leading to a collapse of the finanacial system.
> 
> There I said it.



I suppose as a sector contracts then some companies must go bust to give the rest a reasonable living. 
Two more airlines went bust overnight in Europe, making three this weekend. Twenty eight others are thought to be in trouble.


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## Nick Radge (15 September 2008)

S&P 500 futures have opened 40pts lower on the news...thats a few hundred Dow points


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## sam76 (15 September 2008)

2331 GMT [Dow Jones] Turbulence in local banking and finance stocks expected, says senior institutional trader after reports that Lehman Brothers is expected to file for bankruptcy protection and Wall Street Journal report that Bank of America is in talks to buy Merrill Lynch at US$29/share. "If it's in the WSJ, there's a good chance it might happen; the papers have been pretty accurate," says a trader, adding "news might break later today and I think any deal will be seen as a positive for our banking sector." (WEL)


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## dhukka (15 September 2008)

I wonder how ANZ will fare in all this. Remember that back in February they announced that they had exposure to CDS. 



> between 2005 and February 2007, ANZ entered into derivative transactions which involved selling credit protection on a portfolio of corporate names, and simultaneously buying matching protection from highly rated US financial
> institutions to remove market risk. This was perceived to involve little credit risk and generated modest trading income.
> 
> The significant increase in derivative market credit spreads and volatilities has resulted in a positive mark to market position with the sellers of the credit protection. However one counterparty, which is a US monoline insurer, has been downgraded to a CCC credit rating. The uncertainty around the ability of that firm to meet its obligations under the hedging agreement has resulted in an accounting requirement to raise an Individual Provision of US$200 million based on the current mark to market exposure to that monoline.
> ...




I wonder if that scenario is becoming more likely?


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## sassa (15 September 2008)

sam76 said:


> 2331 GMT [Dow Jones] Turbulence in local banking and finance stocks expected, says senior institutional trader after reports that Lehman Brothers is expected to file for bankruptcy protection and Wall Street Journal report that Bank of America is in talks to buy Merrill Lynch at US$29/share. "If it's in the WSJ, there's a good chance it might happen; the papers have been pretty accurate," says a trader, adding "news might break later today and I think any deal will be seen as a positive for our banking sector." (WEL)



"Positive for our banking sector!!"How did the purchase of Countrywide by BofA improve the financial sector?It has continued to go backwards since that time.I think they overpaid for the entity also.Merrill shares closed at $17.05 on Friday.A big possibility of their shares falling again when the Dow opens tonight.A brave call IMHO.


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## dhukka (15 September 2008)

sassa said:


> "Positive for our banking sector!!"How did the purchase of Countrywide by BofA improve the financial sector?It has continued to go backwards since that time.I think they overpaid for the entity also.Merrill shares closed at $17.05 on Friday.A big possibility of their shares falling again when the Dow opens tonight.A brave call IMHO.




It's a good point sassa, remember B of A overpaid enormously for their first stake in CFC at $18 a share, subsequently they bid $7 and change for the rest of the company and there is still a large possibility that they will revise that bid significantly lower. It's clear these guys don't have a clue what they're doing. 

Merrill has to know that they are next so it is little wonder they are shopping themselves. If B of A pays anywhere near the quoted figures they are nuts. They should also expect a ratings downgrade.


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## Awesomandy (15 September 2008)

And it looks like BoA is bidding $44m for ML. i.e. $29 per share (according to Bloomberg). If they keep buying things like this, BoA will need to file for chapter 11 too.


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## sam76 (15 September 2008)

Banks Roll Out $70 Billion Loan Program
Associated Press
September 14, 2008 10:42 p.m.

NEW YORK -- A group of global banks and securities firms announced late Sunday a $70 billion loan program that financial companies can tap to help ease a credit shortage that threatens global financial markets.

The ten banks, which include JPMorgan Chase & Co. and Goldman Sachs Group Inc., said they were committing $7 billion each for the pool. The pool would act as a signal to the marketplace that banks, brokerages, and other financial companies can lean on the fund to take care of borrowing needs.

The banks said the program will be available to participating banks which can get a cash infusion up to a maximum of one-third of the total size of the pool. The size of the loan program might increase as "other banks are permitted to join."

All participating banks intend to use this facility beginning this week, the statement said.

The banks also include Bank of America Corp., Barclays PLC, Citigroup Inc., Credit Suisse Group, Deutsche Bank AG, Merrill Lynch & Co., Morgan Stanley and UBS.

The banks made the announcement to try to head off market disruptions after the possible failure of investment bank Lehman Brothers Holdings Inc. Lehman was expected to file for bankruptcy by Monday after succumbing to dwindling investor confidence due to losses from its real estate holdings.

http://online.wsj.com/article/SB122144631339134981.html?mod=mktw


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## MrBurns (15 September 2008)

Just looking at the all ords - down 118  to 4838 .......over the edge she goes !

Added - oh dear !

http://www.abc.net.au/news/stories/2008/09/15/2364633.htm


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## MrBurns (15 September 2008)

And here's more - from Crikey. Alan Kohler - 

As I write, it's about 5pm Sunday in Manhattan, and it’s been another long day at the New York Federal Reserve headquarters in Liberty Street, around the corner from Wall Street, as the regulators and Wall Street play chicken over Lehman Brothers.

The next 24 hours will be one of the most decisive and significant in our lifetimes.

Bankers in black town cars began arriving at Liberty Street early in the day yesterday and at 7.30am three bags of Dunkin Donuts were delivered. On Saturday there had been 15 hours of donuts and coffee; yesterday was the same.

On Saturday afternoon, Barclays Bank of the UK pulled out of a plan to buy the Lehman "good bank" because it couldn’t get indemnities.

But in any case, the matching plan for US banks to continue trading with the "bad bank", which contain all of Lehman’s toxic mortgage exposures, was already in trouble.

The question remains: who will step up? Who will throw capital away buying an insolvent institution for zero dollars without taxpayers' money making up the gap? Nobody will -- or can.

The three men trying to orchestrate the rescue of Lehman are Treasury secretary Hank Paulson, Fed chairman Ben Bernanke (who has stayed in Washington) and New York Fed boss Tim Geithner. 

But for them the moral hazard problems are now enormous. Having put taxpayers money into guaranteeing Bear Stearns’ worst assets and then bailing out Fannie Mae and Freddie Mac, they have to draw the line. 

If Lehman goes, then so do Washington Mutual, and then American International Group, each of which is already teetering. Today’s emergency, though, is Lehman. 

And no one wants to buy Lehman for a positive price, or even zero, unless there is a public subsidy -- that is, taking the most toxic assets out of the picture. In fact Barclays didn’t even want to deal on the good assets without a guarantee. 

Pictured arriving yesterday in Liberty Street were Robert Wolf of UBS Americas, Stephen Black of JP Morgan Chase, Vikram Pandit of Citigroup, so we know they are involved in the talks. Others made it through without being photographed. 

Early on Saturday there seemed a chance that Bank of America would step up to the plate, but it, too, was insisting on government support. 

Paulson, Geithner and Bernanke, meanwhile, are holding out. They were trying to play Bank of America and Barclays off against each other but that strategy has now failed, and now they are just jawboning the others – telling them that if they do not put their capital on the line and continue to trade with Lehman this week, they would also suffer devastating counterparty runs this week and would lose more capital if they did not do it. In other words they all are playing chicken. 

If someone does not blink tonight New York time, which is our daytime, then it looks like Lehman will crash before dinner tonight. 

The Wall Street Journal has reported this morning that Lehman has hired law firm Weil, Gotshal and Manges LLP, a bankruptcy specialist, to prepare a Chapter 11 filing. 

Meanwhile Bloomberg has reported that banks and brokers held a session a few hours ago for netting derivatives transactions with Lehman, or cancelling trades that offset each other, in case the New York-based firm files for bankruptcy before midnight New York time. 


There was a statement from the International Swaps and Derivatives Association:

The purpose of this session is to reduce risk associated with a potential Lehman Brothers Inc. bankruptcy filing. The ISDA includes 218 banks, brokerages, insurance companies and other financial institutions from the US and abroad. 

ISDA confirms a netting trading session will take place between 2pm and 4pm New York time for over-the-counter derivatives. Trades are contingent on a bankruptcy filing at or before 11:59pm New York time, Sunday, September 14, 2008. If there is no filing, the trades cease to exist.

If there is a bankruptcy today, then Lehman’s brokerage units would have to file Chapter 7 liquidation, in which a court-appointed trustee would take over and liquidate its assets, so the broking customers could get back their money. 

Lehman’s lenders would immediately withdraw all lines of credit, since Chapter 11 would be a default event. 

There would then be a scramble to see how many of Lehman’s credit default swaps trades could be offset, with new counterparties found. 

Nobody knows how much Lehman has in CDS contracts because this trade is not disclosed, but in a survey last year, Fitch Ratings listed Lehman among the top 10 largest CDS counterparties. If it fails, then, as the ISDA statement above implies, a huge number of CDS contracts will be worthless unless new counterparties can be found. 

Australian municipal councils and others who bought CDOs from Lehman will also be watching events unfold with close interest. 

Lehman was one of the counterparties to about 70 per cent of what was sold to the councils. It was a counterparty or guarantor in one capacity or another. It is also understood to be a reference company in more than 50 per cent of the CDOs. 

So in the first instance, the failure of its debt would be a credit event for those CDOs (most of which also reference Fannie Mae and Freddie Mac -- and for that matter AIG, Merrill Lynch and Washington Mutual) and this would push those CDOs towards loss. 

The other problem with a Lehman bankruptcy is that its assets -- stock, property and mortgage securities -- are likely to hit the market in a firesale, forcing prices even lower and then, next quarter, forcing further mark-to-market write-downs by other banks and investment banks. 

In fact it’s unlikely to be a slow-motion train wreck this time. With Lehman in liquidation, and Washington Mutual and AIG on the brink, the credit market would likely shut down entirely and interbank lending would cease. 

In his newsletter yesterday, Nouriel Roubini wrote:

What we are facing now is the beginning of the unravelling and collapse of the entire shadow financial system, a system of institutions (broker dealers, hedge funds, private equity funds, SIVs, conduits, etc) that look like banks (as they borrow short, are highly leveraged and lend and invest long and in illiquid ways) and thus are highly vulnerable to bank-like runs; but unlike banks they are not properly regulated and supervised, they don’t have access to deposit insurance and don’t have access to the lender of last resort support of the central bank (with now only a small group of them having access to the limited and conditional and thus fragile support of the Fed).

The step by step, ad hoc and non-holistic approach of Fed and Treasury to crisis management has been a failure so far as plugging and filling one hole at the time is useless when the entire system of levies is collapsing in the perfect financial storm of the century. A much more radical, holistic and systemic approach to crisis management is now necessary.

It is hard to imagine what that might be.


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## sassa (15 September 2008)

Guess it's official.



> SAN FRANCISCO (MarketWatch) -- Lehman Brothers Holdings Inc. said early Monday that it will file for Chapter 11 bankruptcy protection and reorganization




http://www.marketwatch.com/news/sto...x?guid={50D06AF4-0AD5-4B38-8206-D4C8D6E62EC7}


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## deadset (15 September 2008)

So lets assume in the worst case that the govt won't guarantee anything and Lehman shares become worthless and then that money is gone, what would the real effect of that be ?  I'm wondering how much Lehman represents to the financial market globally without the panic effect.

Seperating the good and bad bank parts ?  How does that work in theory and practise.  Do investors of Lehman know which part of that bank they've invested in before.  Why would the govt expect anyone to buy the bad part without some sort of cheap credit deal ?

Sub-prime was never zero risk.  I can see the govt's point of view, they lent it, they can fix it.

How much does Lehman owe anyway ?  Surely it's not in the same league as FNM and FRE ?


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## BentRod (15 September 2008)

http://cgi.ebay.com/Lehman-Brothers...temQQimsxZ20080914?IMSfp=TL080914101002r32757


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## Bushman (15 September 2008)

Breathless Greenspan quote no 101: 

"We will see other major financial firms fail," former Federal Reserve chairman Alan Greenspan said. 

"Indeed, we shouldn't try to protect every single institution. The ordinary course of financial change has winners and losers," he said on the ABC program "This Week." 

Well said Alan. 

So who else will partner up in this macabre waltz on the decks of the Titanics?


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## freddy2 (15 September 2008)

Below is my favourite quote from this whole mess.

From http://www.livemint.com/2008/09/11231014/Investors-react-with-joyous-lo.html

And all that had really happened was that KDB proved it may have finally grasped what should be for Asians a cardinal investment principle: never buy anything an American investment banker is selling.


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## deadset (15 September 2008)

News just in.
$70Billion allocated, $7Billion shared between 10 banks.
http://biz.yahoo.com/ap/080915/financial_meltdown.html?.v=4


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## sam76 (15 September 2008)

deadset said:


> News just in.
> $70Billion allocated, $7Billion shared between 10 banks.
> http://biz.yahoo.com/ap/080915/financial_meltdown.html?.v=4



lol been out for a while
https://www.aussiestockforums.com/forums/showpost.php?p=335652&postcount=17


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## spartn (15 September 2008)

*LEHMAN BROTHERS files for bankruptcy*

'Oh crap' this is not going to be good for the US Markets tonight.

Lehman brothers had $613 billion worth of debt, this is bloody crazy.

This is 6x Worldcom bankruptcy.

http://www.bloomberg.com/apps/news?pid=20601087&sid=aPTIdpST8HJ0&refer=home

Spartn

:viking:


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## tayser (15 September 2008)

*Re: LEHMAN BROTHERS files for bankruptcy*

So far, EUR/JPY has had about 3-4 nice 50-100 pips swings for the European opens.

Bring it on NY open


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## Kauri (15 September 2008)

AIG has got about 4days left in it... if P/E don't move in then forget chapter11... it will be the whole book...

Cheeeeers
................Kauri


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## dhukka (15 September 2008)

If you watched any of the financial media you'd think that the snuffing out of Lehman Bros and Merrill was a very big deal. Let's face it, these guys are not an integral part of the economy. They got way too big on way too much leverage. If Goldman and MS don't make it as independent companys, frankly good ridance. 

The bigger risk is of a systemic collapse. The likes of AIG and WaMu are much more important IMO. WaMu is not Wall Street, it's main street with branches all over the country and *$182* billion worth of customer deposits. That would create a very big headache for the already under funded FDIC. 

I also think the BofA, Merrill deal is very sus. I doubt BofA thinks Merrill is worth $29  a share, although they did initially pay $18 for a stake in CFC. 

Here's a hypothetical. All the masters of the universe got together on Sunday and realized the obvious - Merrill would be next. We have reports that the Fed forced the Merrill sale, why? To stop a run on the investment banks and other commercial banks. Try to shore up confidence in the market by putting a floor under the price for these institutions. Then months later after the crisis has been averted, BofA can renegotiate the terms of the deal. You can see it now. 

"After reevaluating the Merrill portfolio we have decided that fair value is closer to $9 a share."


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## BradK (15 September 2008)

dhukka said:


> All the masters of the universe got together on Sunday and realized the obvious - Merrill would be next. We have reports that the Fed forced the Merrill sale, why? To stop a run on the investment banks and other commercial banks. Try to shore up confidence in the market by putting a floor under the price for these institutions. Then months later after the crisis has been averted, BofA can renegotiate the terms of the deal. You can see it now.
> 
> "After reevaluating the Merrill portfolio we have decided that fair value is closer to $9 a share."




No doubt. One thing has emerged in these past 18 months. This is not about bottom lines, or shareholders, or capitalism, or financial system integrity. This whole credit crisis has revealed the utter moral bankruptcy of big bankers (inc. those in Australia) and revealed to the public that they REALLY are slaves in modern clothing. 

Some soul searching needed from all this... but we wont... because the masters of the universe own CNN and Newscorp! 



Brad


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## korrupt_1 (15 September 2008)

How many other similar banks left standing?

_to the tune of "99 bottles on the wall"_

"99 banks trading on the wall... and if 1 bank was to accidentally fall... there will be 98 banks trading on the wall...

98 banks trading on the wall..........."


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## noirua (15 September 2008)

Wipe out day in London for the financial sector with Bank connected shares falling 8% to 20%. No point mentioning names as its all shares in the sector.


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## noirua (16 September 2008)

It does look as if the withdrawal of Bank of America and Barclays Bank was because the problems of Lehman were disastrous. Some say, "not a cent left for shareholders."
No pay this month for staff and most creditors will get little or nothing.
Staff in London are just packing boxes to be sent back to the States and leaving.
Lehman looks dead in the water, and a 500+ point dive in the Dow 30 as reality strikes late in the day.
An interest rate cut tomorrow looks certain as the Fed meets.


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## nunthewiser (16 September 2008)

OK ladies and gents ..  what ozzie investment banks/financials have exposure to lehman , aig etc etc ?also what other so called blue chips are exposed by the holdings these dodgy yanks have holdings in ? thanks in advance


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## noirua (16 September 2008)

nunthewiser said:


> OK ladies and gents ..  what ozzie investment banks/financials have exposure to lehman , aig etc etc ?also what other so called blue chips are exposed by the holdings these dodgy yanks have holdings in ? thanks in advance




Grange Securities are an Aussie Unit of Lehman Brothers. Other Australian Banks have not declared their exposures, direct and indirect yet.


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## nunthewiser (16 September 2008)

thanks Noi, going to be intresting the fallout and the disclosures to come i suspect


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## gfresh (16 September 2008)

It will take a while to work out, weeks, months even.. 

Going to take many thousands of people many hours to peer over books, and work out their exact exposure. Also going to take a while for Lehman to deleverage itself, sell assets, etc under government eye. No doubt slowly trickled onto markets piece by piece.


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## wayneL (16 September 2008)

Today's Daily Mail:


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## brty (16 September 2008)

Hi,

What I haven't read about is the effect on many local govt's and charities that bought CDOs from Grange/Lehmans. Many of them (most?) have not written off that money because they were taking legal action to recover the money.

They were going to sue Lehmans. 

If they pursue legal action now, they are just wasting more money, but can keep the CDOs as "an asset" on their books.

This is going to take time to unwind.

brty


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## Kauri (16 September 2008)

wayneL said:


> Today's Daily Mail:





  You can lead a Lemming to a cliff butt....   

 incidentally if this doesn't help out IVC nothing will..   

Cheers
..........kauri


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## fimmwolf (16 September 2008)

why am I suddenly feeling like the only safe place for my money is in an old biscuit tin in the pantry :run:


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## dhukka (16 September 2008)

dhukka said:


> It's a good point sassa, remember B of A overpaid enormously for their first stake in CFC at $18 a share, subsequently they bid $7 and change for the rest of the company and there is still a large possibility that they will revise that bid significantly lower. It's clear these guys don't have a clue what they're doing.
> 
> Merrill has to know that they are next so it is little wonder they are shopping themselves. If B of A pays anywhere near the quoted figures they are nuts. *They should also expect a ratings downgrade*.




The stockmarket gave a big bronx cheer to the BofA / Merrill deal with MER closing flat at *$17* and BofA falling *-21%*. The ratings agency also didn't think it was such a hot deal. 



> *Bank of America emerges from the frenzy with Merrill Lynch to lead 'thundering herd'*
> 
> Standard & Poor's, the rating agency, immediately poured cold water on the deal, as did the stock market, where Bank of America shares tumbled by 14 per cent. S&P cut its credit rating for Bank of America and said that it might cut it again. The ratings agency gave warning that the deal would put further strain on the bank's capital after its purchase in July of Countrywide, the mortgage lender.


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## Green08 (22 September 2008)

Now Lehman Brothers in england are demanding Lehman Brothers in New York repay $8 Billion they sent to them a few days before the bankrupcy.  Now what happens?


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