I heard this rumor from two sources, that Lehman is in its final day or two and Goldman is willing to buy the firm, and the second source, who volunteered the information, is sufficiently well plugged in that I trust the reading. This came from a former senior employee: A couple friends of mine from […]
Read more...Lehman’s survival as an independent firm looks increasingly in doubt, yet the shape of an end game is not yet clear, although, per T.S. Eliot, it likely to conclude with a whimper. The market’s reaction to Lehman’s way worse than expected earnings announcement of $3.9 billion in loses due to $5.6 billion in writedowns was […]
Read more...Readers may recall that the Treasury’s rescue plan for the GSEs called for preferred stock dividend to be eliminated and for new investment by the government to come in the form of preferred stock that would be senior to the outstanding preferred. Needless to say, those actions have had a rather deleterious effect on the […]
Read more...The short answer is yes, but we need to define fail And BTW, it’s very frustrating to be stuck on a plane waiting for the weather on the eastern seaboard to clear while the markets were having such an exciting day. As readers no doubt know, Lehman broke down after word got out that talks […]
Read more...This Guardian article by Kenneth Rogoff (hat tip Mark Thoma) sends a blunt warning: central banks are taking on so much dodgy debt that they will put themselves at risk if they continue extending support to their banking systems. Rogoff argues (as we have) that the banking system needs to shrink (an inevitable consequence of […]
Read more...We had noted earlier that the price discussions around the possible sale by Lehman of a stake in its asset management operations valued the rest of the firm at close to zero. A story at Bloomberg has taken this line of thinking one step further. From Bloomberg: Lehman’s market capitalization of $11.2 billion is almost […]
Read more...We were willing to be proven wrong in our skepticism of Korea Development Bank’s pursuit acquiring a stake in Lehman. We had no doubts about the interest; the KDB CEO was the former Seoul branch manager for Lehman and full bore behind a deal. But the reception of the Korean government, which had to approve […]
Read more...A little late, don’t’cha think? Yes, that is a one year price chart. One of the best buy indicators on a stock is when analysts are close to unanimity in designating it a sell. Like rating agencies, analysts are loath to downgrade a stock. By the time things are so indisputably dreadful that they can […]
Read more...Although there have been rumors of various Lehman Hail Mary passes (the number of companies allegedly interested in investing in the troubled bank seems to grow on a daily basis), the one involving it spinning off less than choice debt into a liquidation vehicle appears to have some substance. A Bloomberg story today gives details […]
Read more...One of the pet notions of M&A is that anything can be solved by price. Thus even a garbage barge embattled institution like Lehman might could be a screaming bargain at the right level. So it’s possible that HSBC and the unnamed Chinese bank are indeed interested in Lehman, but “interested” covers a multitude of […]
Read more...Korea Development Bank CEO and former Lehman Seoul branch manager Min Euoo Sung confirmed that talks with Lehman about a possible investment are still continuing. Note that Min has been the driving force behind the deal; the stumbling block appears to have been getting official approval. With talks apparently fairly serious, it would seem some […]
Read more...When the Korea Development Bank had signaled that buying a stake in an investment bank might be premature at this juncture, it had appeared the bureaucrats had beaten back KDB’s chairman and former head of Lehman’s Seoul branch, Min-Euoo-song, who was pushing the deal. But the Telegraph tells us not only that negotiations are back […]
Read more...We were pretty skeptical of the idea that Korea Development Bank would buy a stake in Lehman, particularly since Dick Fuld seems a bit in denial as to what a stake in the storied firm might fetch these days (for instance, for the asset management operations, he wanted a buyback option. Let’s see, you are […]
Read more...Before you get too excited, the current display of regulatory vigor is almost certainly motivated by a desire to protect turf rather than new-found solicitude for investors’ welfare. Bloomberg reports that the Financial Industry Regulator Authority will start on-site inspections of 40 brokerage firms regarding their participation in the auction rate securities meltdown. Wow! Action! […]
Read more...Stories by Bloomberg and Reuters on a talk by Kenneth Rogoff, former chief economist for the IMF and currently a Harvard professor, fail to mention perhaps his most relevant credential as far as opining on the US credit crunch is concerned. He and Carmen Reinhart of the University of Maryland have done an extensive study […]
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