Lehman, its NOT going well!

[raja]

Re: Lehman, its NOT going well!

I take it the Asian markets just opened. Gold shot up something like $12 vertically when it opened per Kitco.

forex.com:

Market closed Friday for EUR/USD at about $1.422, up to $1.431 not long after open. (negative for dollar)

At the open at 5pm, USD/JPY went from 107.94 straight down to 105.75. It's recovered half of that back.

What is this from Kitco silver, a computer glitch or what:

[Supercilious]

Re: Lehman, its NOT going well!

I take it the Asian markets just opened. Gold shot up something like $12 vertically when it opened per Kitco.

forex.com:

Market closed Friday for EUR/USD at about $1.422, up to $1.431 not long after open. (negative for dollar)

At the open at 5pm, USD/JPY went from 107.94 straight down to 105.75. It's recovered half of that back.

The next move is to try to reinforce the counterparties in order to prevent a domino effect and total collapse of CDS house of cards:

http://www.reuters.com/article/ousiv...01004320080914

WASHINGTON (Reuters) - U.S. and foreign banks are forming a $50 billion fund to help save troubled companies, the NBC television network reported, without citing any sources.
Creation of the fund comes as negotiations to save troubled investment bank Lehman Brothers (LEH.N: Quote, Profile, Research, Stock Buzz) appear to be faltering. The fund would be aimed at the "next tier" of companies that could face financial difficulties, NBC said, without offering any further details of how the fund would work or who would contribute to it.

This is getting truly interesting ... why would it be better to put $50 bil into propping the counterparties then putting $10 bil in Lehman ???? That doesn;t make too much sense to me.

What this fund will be ... some sort of CDS^2 ???:eek:

[rj1]

Re: Lehman, its NOT going well!

Bloomberg is now reporting that both Barclay's and Bank Of America have withdrawn from buyout talks. The Dow futures opened up a few minutes ago down 300 points.

Now down only 23 points.

I think the "267 point jump" is the Merrill buyout at a premium, as a kind of "hey, at least there's some good news coming out of this". From the looks of it, Lehman's still going bankrupt...

Is Bank of America in some kind of wonderful, awesome shape? They have Countrywide and now Merrill, which by all accounts, was the next domino after Lehman.

So what was five became four and tomorrow will be two.

CNBC Special Report at 8 o'clock...right now! Go there.

[Jim Nickerson]

Re: Lehman, its NOT going well!

Now down only 23 points.

I think the "267 point jump" is the Merrill buyout at a premium, as a kind of "hey, at least there's some good news coming out of this". From the looks of it, Lehman's still going bankrupt...

Is Bank of America in some kind of wonderful, awesome shape? They have Countrywide and now Merrill, which by all accounts, was the next domino after Lehman.

So what was five became four and tomorrow will be two.

CNBC Special Report at 8 o'clock...right now! Go there.

Indices
S&P 500 Index (SPZ8)	8-Dec	1226.9	-31.6	1236.3	1236.3	1215.5	18:49
Mini S&P 500 Index (ESZ8)	8-Dec	1227	-31.5	1235	1235	1215.5	18:49
Nasdaq 100 (NDZ8)	8-Dec	1748.25	-31.25	1764	1764	1729	18:21
E-Mini Nasdaq (NQZ8)	8-Dec	1742.5	-37	1763.75	1763.75	1723.25	18:49
Dow Industrials (DJZ8)	8-Dec	11451	4	11335	11465	11277	9/12/2008
Dow Industrials (E) (ZDZ8)	8-Dec	11187	-264	11312	11312	11140	18:49
Mini-Sized Dow (YMZ8)	8-Dec	11183	-268	11269	11285	11121	18:49

These quotes are from barcharts.com dated today.

[jk]

Re: Lehman, its NOT going well!

Lehman to File for Bankruptcy Protection
September 14, 2008, 5:55 pm
Dealbook

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.

Lehman will seek to place its parent company, Lehman Brothers Holdings, into bankruptcy protection, while its subsidiaries will remain solvent while the firm liquidates its holdings, these people said. A consortium of banks will provide a financial backstop to help provide an orderly winding down of the 158-year-old investment bank. And the Federal Reserve has agreed to accept lower-quality assets in return for loans from the government.

[rj1]

Re: Lehman, its NOT going well!

Indices
S&P 500 Index (SPZ8)	8-Dec	1226.9	-31.6	1236.3	1236.3	1215.5	18:49
Mini S&P 500 Index (ESZ8)	8-Dec	1227	-31.5	1235	1235	1215.5	18:49
Nasdaq 100 (NDZ8)	8-Dec	1748.25	-31.25	1764	1764	1729	18:21
E-Mini Nasdaq (NQZ8)	8-Dec	1742.5	-37	1763.75	1763.75	1723.25	18:49
Dow Industrials (DJZ8)	8-Dec	11451	4	11335	11465	11277	9/12/2008
Dow Industrials (E) (ZDZ8)	8-Dec	11187	-264	11312	11312	11140	18:49
Mini-Sized Dow (YMZ8)	8-Dec	11183	-268	11269	11285	11121	18:49

These quotes are from barcharts.com dated today.

My apology, I copied a typo from somewhere else.

[metalman]

Re: Lehman, its NOT going well!

And the Federal Reserve has agreed to accept lower-quality assets in return for loans from the government.

here's what we just bought that no one else wanted, folks!



fuck me!!! :mad::mad::mad::mad:

at least we own this to hedge the loss...

[photoncounter]

Re: Lehman, its NOT going well!

The Mother of All Mondays:

http://blogs.wsj.com/marketbeat/2008...f-all-mondays/

Investors world-wide have rarely rolled out of bed to face a Monday morning quite like the one they’ll contend with this Monday.

If Lehman can’t find a life raft, it could lead to turmoil in the credit markets as traders rework credit-default swaps and other trades with Lehman at their center. Credit-default swaps traders were called to work Sunday, the Wall Street Journal reported, for a special trading session that would let Lehman counterparties offset their positions against each other. Equity markets could also be roiled Monday. The crumbling of a major Wall Street institution is likely to shake badly the confidence of investors who had hoped the Street would make it through the credit crisis without yet another large firm being swallowed up. What’s more, the economic backdrop looks dimmer than it did in March when Bear Stearns was pushed into the arms of Jamie Dimon.

[Slimprofits]

Re: Lehman, its NOT going well!

PIMCO is very large holder of Lehman debt. Gross very quiet on this one, I wonder why? Paulson really owes him for buying GSE debt when others were selling. Of course PIMCO made big bucks on the trade. Can't see Paulson letting him down now, that's not how it works on the Street.

Gross to Reuters last night:

"It appears that Lehman will file for bankruptcy and the risk of an immediate tsunami is related to the unwind of derivative and swap-related positions worldwide in the dealer, hedge fund, and buyside universe," Gross, the chief investment officer of Pacific Investment Management Co (Pimco), told Reuters.

"The extraordinary trading session held today to facilitate a partial unwind of these positions saw very little trading perhaps $1 billion total but at much wider spread levels for corporate bonds," Gross said.

"To some extent, the rumored bid for Merrill by Bank of America lends some confidence to all markets, although I am skeptical that BofA would pay such a premium on such short notice," Gross added.

From Gross in the latest Investment Outlook:

And the private market, in its attempt to anticipate a bear market bottom and snap up “bargains,” has been constructive as well. Over $400 billion in bank- and finance-related capital has been raised during the past year, a decent amount of it, by the way, having been bought by yours truly and my associates at PIMCO. Too bad for us and for everyone else who bought too soon. There are few of these deals now priced at par or above, which is bondspeak for “they are all underwater.” We, as well as our SWF and central bank counterparts, are reluctant to make additional commitments.

[..]

...if we are to prevent a continuing asset and debt liquidation of near historic proportions, we will require policies that open up the balance sheet of the U.S. Treasury – not only to Freddie and Fannie but to Mom and Pop on Main Street U.S.A., via subsidized home loans issued by the FHA and other government institutions. A 21st century housing-related version of the RTC such as advocated by Larry Summers amongst others could be another example of the government wallet or balance sheet that is required during rare periods when the private sector is unable or unwilling to step forward.

The bill for our collective speculative profligacy, obvious in the deflating asset markets, can be paid now or it can be paid later. Those aspiring for a perfect 800 on the Wall Street policy exam would conclude that the tab will be less if paid up front, than if swept under a rug of moral umbrage intent on seeking retribution for any and all of those responsible. Now that the Fed has spent 12 months proving that it “knows something…knows something,” it is time for the Treasury to do likewise.

Booyah Hank?

[rj1]

Re: Lehman, its NOT going well!

The Mother of All Mondays:

http://blogs.wsj.com/marketbeat/2008...f-all-mondays/

Investors world-wide have rarely rolled out of bed to face a Monday morning quite like the one they’ll contend with this Monday.

Didn't they...last Monday?

Also, Merrill Lynch is officially bought by Bank of America and is no longer a public company.

[LargoWinch]

Re: Lehman, its NOT going well!

Yeah...and so it goes: Gold up $17+ so far after a 2%+ increase last session...

[pinhead]

Re: Lehman, its NOT going well!

If anyone has any insite I would like to hear what happened at the ISDA derivatives session this (Sunday) afternoon. I was watching CNBC This evening and one of the heads (Carlos?) started mentioning that the session was a mess, or something to that effect. They cut him off right after he started describing it and never went back to him.

I guess I would really like some insite into what happened, why he had a negative take on it, and what it ultimately means.

I suspect thoughts and insites will start popping up, but this is the information I need to understand, as I think its implications really tell us some truth about the credit markets and conditions of all sorts of derivatives beyond Lehman. Since we have to think Lehman is not so singular.

Thanks, Rich

Wall Street Braces for Lehman Bankruptcy with Special Trading Session


Sham-Wow!


Wall Street Prepares for Potential Lehman Bankruptcy
By Craig Torres
September 14, 2008 15:19 EDT

Sept. 14 (Bloomberg) -- Wall Street prepared for a potential Lehman Brothers Holdings Inc. bankruptcy after Barclays Plc said it pulled out of talks to buy the firm and the government indicated it wouldn't provide funds in a resolution.

Banks and brokers today held a session for netting derivatives transactions with Lehman, or canceling trades that offset each other, in case the New York-based firm files for bankruptcy before midnight New York time.

``The purpose of this session is to reduce risk associated with a potential Lehman Brothers Inc. bankruptcy filing,'' the International Swaps and Derivatives Association said in a statement today. The ISDA includes 218 banks, brokerages, insurance companies and other financial institutions from the U.S. and abroad.

The step indicates that Wall Street lacks confidence that three days of talks to find a buyer for Lehman, held at the Federal Reserve Bank of New York, will be successful. Treasury Secretary Henry Paulson, who has led the talks with New York Fed President Timothy Geithner, was adamant two days ago against using taxpayer funds in a resolution.

The fourth-largest securities firm until the past week, Lehman has thousands of such trades in credit, equity, commodity, interest rates and currency derivatives.

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

The announcement came after Barclays, the U.K.'s third- biggest bank, said it abandoned talks to buy Lehman, contending it couldn't obtain guarantees to protect against potential losses at the U.S. securities firm.


http://jessescrossroadscafe.blogspot.com/

[jk]

Re: Lehman, its NOT going well!

If anyone has any insite I would like to hear what happened at the ISDA derivatives session this (Sunday) afternoon. I was watching CNBC This evening and one of the heads (Carlos?) started mentioning that the session was a mess, or something to that effect. They cut him off right after he started describing it and never went back to him.

I guess I would really like some insite into what happened, why he had a negative take on it, and what it ultimately means.

I suspect thoughts and insites will start popping up, but this is the information I need to understand, as I think its implications really tell us some truth about the credit markets and conditions of all sorts of derivatives beyond Lehman. Since we have to think Lehman is not so singular.

Thanks, Rich

i read somewhere that only about 1 billion actually traded.

[chrisk]

Re: Lehman, its NOT going well!

If anyone has any insite I would like to hear what happened at the ISDA derivatives session this (Sunday) afternoon.

A couple links with more detail. Sounds like it was a waste.

http://www.cnbc.com/id/26707165

"But the bids and offers were extremely wide. A key problem: only one half of the trade has an incentive to get the deal done. If a participant owes money to Lehman, they have less incentive to clear the trade. If a participant is owed money by Lehman, they would love to clear the trade, but the price the other side is offering now is extremely high. "


http://www.ft.com/cms/s/0/2edc75ae-8...077b07658.html

EDIT: Also I'd note that this is pretty bad news. If they were so desperate to hold this emergency session to cushion any imminent derivatives unwinding, and yet nothing really came of it, what does that tell us about what is STILL imminent...

[Jim Nickerson]

Re: Lehman, its NOT going well!

S&P 500 Index (SPZ8)	8-Dec	1212.8	-45.7	1236.3	1236.3	1212.8	22:19	Q C O
Mini S&P 500 Index (ESZ8)	8-Dec	1212.75	-45.75	1235	1235	1212.75	22:19	Q C O
Nasdaq 100 (NDZ8)	8-Dec	1732	-47.5	1764	1764	1729	22:18	Q C O
E-Mini Nasdaq (NQZ8)	8-Dec	1730	-49.5	1763.75	1763.75	1723.25	22:19	Q C O
Dow Industrials (DJZ8)	8-Dec	11451	4	11335	11465	11277	9/12/2008	Q C O
Dow Industrials (E) (ZDZ8)	8-Dec	11107	-344	11312	11312	11107	22:19	Q C O
Mini-Sized Dow (YMZ8)	8-Dec	11105	-346	11269	11285	11105	22:19	Q C O