Lehman Brothers is the next Bear Stearns?

no kidding...i also wonder if this will finally break the nyc housing market with the collateral damage from these bankruptcies and mergers.

 

I don't think it will be that bad. Have you seen the ABX index this last week? It has rallied quite a bit, and has been a pretty good lead indicator as to what the credit sentiment in the market is.

http://www.markit.com/information/products/category/indices/abx.html

 

well it is a different world at work. its gonna suck because i was pretty much betting on a leh buyout since i was long some of their preferreds. i thought the risk reward looked good enough for the trade. certainly wasn't a slam dunk and i knew it but i thought the odds and risk/reward was in my favor with their preferreds trading at like 30-40 cents on the dollar. hopefully i will be able to get out of them at a higher price than 0 lol. i can laugh at it because i have already planned for this worst case scenario with my trade. it sucks but i gotta move on and deal with it.

also as a word of caution on GS and MS...i heard nouriel roubini (an analyst who has been spot on with the credit crisis) on cnbc earlier and he said he believed gs and ms would have to find buyers for themselves within the next 6 months or risk being next in line for the chopping block. the other commentator agreed so i have to believe that this idea isn't complete bs or panic and it is a probable outcome if nothing changes at those firms. gs won't have any trouble finding buyers...they are awesome. don't know as much about ms. also i wouldn't freakout about jpm or xlf...but i don't know your entry price either. market is only down like 250 on this news which you would think would be back breaking. i also believe that since mer was sold for a premium then that helps instill some sort of confidence in the value of some of these overleveraged firms.

 

yeah a lot is already priced in...except for aig begging the fed for a loan. if the fed says no then aig is dead. i dunno...it's gonna be interesting...the tapestry of credit is unraveling. imagine what will happen when this happens to the us govt and our out of control debt.

 

It's all over. LEH to file for bankruptcy per CNBC...

 

Indeed. If GS goes down, we're pretty much doomed the way I see it.

 

CNBC reporting that three firms are withdrawing their stake bids on AIG.

Oh boy.

I'm starting to wonder if AIG will even survive Monday.

 

Nouriel Roubini is quite possibly the biggest bear on Wall Street. He has been talking doom and gloom for some time now, and he has been proven right. He does exaggerate a bit, but he talks apocalyptic scenarios alot. If you roll up Marc Faber and David Tice, you would have Roubini.

 

same reasoning as the others....not enough capital to back up the stuff they are in. i agree goldman is stellar so i would have to wait and see on them but the fact that a pretty reliable guy has stated this makes me believe there is some smoke at gs and ms. also, i don't know goldman's leverage ratio but i would gets it is at least 20:1.

edit just checked it was 18.6:1 back in april of this year so likely somewhere close to that now.

 

This whole credit chain is being unwound, looks like each of the major broker dealers will be attacked. Its pretty much utter chaos on the street right now, so I have been told.

 

I'm literally banking on it. As 380 mentioned Roubini has been lights out with his calls. Its kind of scary. But hopefully Golden "smartest guys in the room" Sachs should be okay.


Here is the video -
http://www.cnbc.com/id/15840232?video=850685083&play=1

 

Level 3 assets as of few months ago:

 

I heard someone saying we need to watch GE ... I can see why.

I can't even begin to fathom what would happen if GE were to even enter into crisis mode the way Merrill did.

The world is changing before our eyes, a lot of assets are changing hands.

 

Level 3 assets? How do you valuate them?

This entire thing sucks. Some people got rich and now you have the public holding the bag.

 

GE is just too big and diversified.

 

http://money.cnn.com/data/premarket/index.html

Premarket down 300+ points.

 

merrill being bought out, lehman going bankrupt, AIG on the verge of being downgraded, wamu being bought out... WTF is going on here? trickle-down economics is a sham.

if you vote republican this election, i will hunt you down and punch you.

 

How is this related to trickle down economy?

 

the conservative economic theory of reducing government interference in free-trade, ultimately allowing little oversight to these corporations, and then bailing most of these corporations out?