Comments on: Bloomberg: Lehman Sold $5 Billion of Assets to Investee Hedge Fund http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of.html Mon, 23 Nov 2009 02:08:55 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: Richard Kline http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of.html#comment-9763 Richard Kline Thu, 19 Jun 2008 10:40:00 +0000 http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of-assets-to-investee-hedge-fund/#comment-9763 So stuart, that does seem an astute read, yes. The overall similarity of the article to the earlier source position is quite suggestive, even while the timing and size of the numbers suggest spin as anon of 5:09 says. It doesn't sound likely that LEH would have moved $55-70B in a bundle, but rather in packets. And recall that the LEH official numbers on how much they have 'sold' don't fully jibe with their remaining stated obligations, suggesting that many of the so-designated 'sold' assets may be _on-going transactions_, i.e. earmarked for sale rather than actually transferred. More and more this sounds like the Lehman's statements of recent weeks are explictly to manage reporting and market response so they could 'beat the number' rather than to give a clear picture of their PRESENT FULL EXPOSURE. . . . If so, isn't that illegal as materially misleading information even if LEH manages to actually complete any such 'sales in progress'? . . . Do the laws have any force if the Center Banker cannot fold?? So stuart, that does seem an astute read, yes. The overall similarity of the article to the earlier source position is quite suggestive, even while the timing and size of the numbers suggest spin as anon of 5:09 says. It doesn’t sound likely that LEH would have moved $55-70B in a bundle, but rather in packets. And recall that the LEH official numbers on how much they have ’sold’ don’t fully jibe with their remaining stated obligations, suggesting that many of the so-designated ’sold’ assets may be _on-going transactions_, i.e. earmarked for sale rather than actually transferred. More and more this sounds like the Lehman’s statements of recent weeks are explictly to manage reporting and market response so they could ‘beat the number’ rather than to give a clear picture of their PRESENT FULL EXPOSURE. . . . If so, isn’t that illegal as materially misleading information even if LEH manages to actually complete any such ’sales in progress’? . . . Do the laws have any force if the Center Banker cannot fold??

]]> By: Anonymous http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of.html#comment-9757 Anonymous Thu, 19 Jun 2008 09:09:00 +0000 http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of-assets-to-investee-hedge-fund/#comment-9757 Wow, Yves, fantastic! Not only does Charlie G and his Murdoch crew monitor your blog, this shows that many other large media types do too. Who started the basis for this article? Don't you find it eerily odd that a bbrg article pops up the day after your article with the counterpoint spin? Wow, Yves, fantastic! Not only does Charlie G and his Murdoch crew monitor your blog, this shows that many other large media types do too. Who started the basis for this article? Don’t you find it eerily odd that a bbrg article pops up the day after your article with the counterpoint spin?

]]> By: eh http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of.html#comment-9754 eh Thu, 19 Jun 2008 08:18:00 +0000 http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of-assets-to-investee-hedge-fund/#comment-9754 <i>Totally consistent with LEh's focus on managing the PR rather than dealing with their problems.</i><br/><br/>If the Fed can do it, why not LEH? Still no word that I have heard on what the end game for those assets traded for treasuries will be, other than some recent emphasis that the 'alphabet soup' would go cold sometime. Does anyone really believe that paper will fetch a better mark later this year? The Fed has given these creeps a modus operandi. Totally consistent with LEh’s focus on managing the PR rather than dealing with their problems.

If the Fed can do it, why not LEH? Still no word that I have heard on what the end game for those assets traded for treasuries will be, other than some recent emphasis that the ‘alphabet soup’ would go cold sometime. Does anyone really believe that paper will fetch a better mark later this year? The Fed has given these creeps a modus operandi.

]]> By: tomd http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of.html#comment-9743 tomd Thu, 19 Jun 2008 03:20:00 +0000 http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of-assets-to-investee-hedge-fund/#comment-9743 If I were a "buyer" with no personal liability, I would be liberal with the "price" I paid if LEH were liberal with the financing of the deal.<br/><br/>A huge clue was in that arrogant posting by what appeared to be a LEH BSD last week. His/her "explanation" consisted of capitalizing the word SOLD rather than providing a single detail. In other words, "tiger", the assets were SOLD because I said so. Now go away, stop bothering me.<br/><br/>That alone tells me the deals are full of BS. Totally consistent with LEh's focus on managing the PR rather than dealing with their problems.<br/><br/>TomD If I were a “buyer” with no personal liability, I would be liberal with the “price” I paid if LEH were liberal with the financing of the deal.

A huge clue was in that arrogant posting by what appeared to be a LEH BSD last week. His/her “explanation” consisted of capitalizing the word SOLD rather than providing a single detail. In other words, “tiger”, the assets were SOLD because I said so. Now go away, stop bothering me.

That alone tells me the deals are full of BS. Totally consistent with LEh’s focus on managing the PR rather than dealing with their problems.

TomD

]]> By: Anonymous http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of.html#comment-9742 Anonymous Thu, 19 Jun 2008 03:05:00 +0000 http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of-assets-to-investee-hedge-fund/#comment-9742 Did they sell, get cash and independently pay down debt(without quid-pro quo). Or did they exchange gross asset + piece of debt in exchange for a similarly risky "net asset". (Which could also give the appearance of de-leverging) Did they sell, get cash and independently pay down debt(without quid-pro quo). Or did they exchange gross asset + piece of debt in exchange for a similarly risky “net asset”. (Which could also give the appearance of de-leverging)

]]> By: stuart http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of.html#comment-9741 stuart Thu, 19 Jun 2008 03:01:00 +0000 http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of-assets-to-investee-hedge-fund/#comment-9741 as a firm believer in the cockroach theory, the $5B could've been just one sale transaction with many others yet to be reported on, that in aggregate is close to $55B. Given that so many other details are so similar, I somewhat expect the totals to be similar in the end story as well. as a firm believer in the cockroach theory, the $5B could’ve been just one sale transaction with many others yet to be reported on, that in aggregate is close to $55B. Given that so many other details are so similar, I somewhat expect the totals to be similar in the end story as well.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of.html#comment-9740 Anonymous Thu, 19 Jun 2008 02:49:00 +0000 http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of-assets-to-investee-hedge-fund/#comment-9740 Yves, have you heard whether the other $65 billion(70- $5 that went into Rieder's fund)of net assets were sold for cash or other non-liquid asset? Just wondering if LEH was able to arrange exchanges with counterparties where they possibly received illiquid high risk assets in return for the high risk assets they gave up. It could allow them to still treat the transactions as sales and also allow them establish valuation benchmarks(subject to manipulation) for other assets they still hold. Could be a takeoff on the artificial "round-trip" revenue transactions employed by Enron and others in earlier years. Just wondering... Yves, have you heard whether the other $65 billion(70- $5 that went into Rieder’s fund)of net assets were sold for cash or other non-liquid asset? Just wondering if LEH was able to arrange exchanges with counterparties where they possibly received illiquid high risk assets in return for the high risk assets they gave up. It could allow them to still treat the transactions as sales and also allow them establish valuation benchmarks(subject to manipulation) for other assets they still hold. Could be a takeoff on the artificial “round-trip” revenue transactions employed by Enron and others in earlier years. Just wondering…

]]> By: etc http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of.html#comment-9738 etc Thu, 19 Jun 2008 02:07:00 +0000 http://www.nakedcapitalism.com/2008/06/bloomberg-lehman-sold-5-billion-of-assets-to-investee-hedge-fund/#comment-9738 "It isn't out of the question that some of the other assets sold by Lehman were financed or placed with entities in which the firm has an economic interest."<br/><br/>Exactly, the question is whether there was LEH sold at prices above intrinsic value and bears the risk of the inflated sale price by having provided nonrecourse financing or bearing risk of loss through a guarantee, CDS, or otherwise. “It isn’t out of the question that some of the other assets sold by Lehman were financed or placed with entities in which the firm has an economic interest.”

Exactly, the question is whether there was LEH sold at prices above intrinsic value and bears the risk of the inflated sale price by having provided nonrecourse financing or bearing risk of loss through a guarantee, CDS, or otherwise.

]]>