Comments on: Lehman Death Watch: Are Fuld’s Days Numbered?

By: Anonymous

Anonymous — Sat, 20 Sep 2008 04:57:00 +0000

How convenient that after a week orchestrated by Paulson, only Goldman and Morgan remain intact. Guess Morgan owes its fate to the fact that it would’ve have just been too obvious if Goldman was the sole survivor. It pays to have friends in the right places!

By: Carlosjii

Carlosjii — Fri, 12 Sep 2008 00:45:00 +0000

Yves please post comments latest first
you’re like a non-technical friend who had her Inbox Hotmail default organized latest – last, had xxxx msgs and scrolled to the bottom all the time to read her latest mail

By: Anonymous

Anonymous — Thu, 11 Sep 2008 16:46:00 +0000

Did someone mention…Kudlow? Guess he is back on the white pony again if he thinks Lb is going to do fine. Btw, I think he has a great personality, and used to be a smart economist, but he is now a regular shill (sp?)… .

By: zak822

zak822 — Thu, 11 Sep 2008 16:07:00 +0000

This is an interesting departure from what I heard last night and this morning on CNBC.

The near consensus view there, including Kudlow, was that Lehman would do just fine. That maybe even the Feds would step in, a la Bear Stearns.

By: Anonymous

Anonymous — Thu, 11 Sep 2008 15:52:00 +0000

I see no reason that taxpayers shouldnt bail out Fuld and keep his options fully protected. We need to save people like this as we rebuild the banking industry! This is God’s plan!

By: Anonymous

Anonymous — Thu, 11 Sep 2008 15:49:00 +0000

In 2006, Fuld was named #1 CEO in the Brokers & Asset Managers category, by Institutional Investor magazine.
Fuld serves on the board of directors of the Federal Reserve Bank of New York and is a member of the International Business Council of the World Economic Forum and the Business Council. He also serves on the Board of Trustees of Middlebury College and New York-Presbyterian Hospital, as well as on the board of directors of the Robin Hood Foundation.

By: burrite

burrite — Thu, 11 Sep 2008 14:22:00 +0000

fwiw, hearing from LEH employees that they’ve been told by mgmt to expect the end to come in next 24-48 hours. GS is apparently a willing buyer (at nominal price), but LEH would prefer to sell to someone else, b/c GS would cut virtually the entire equities and I-banking business.

By: Anonymous

Anonymous — Thu, 11 Sep 2008 14:03:00 +0000

It’s true that forcing debt holders to take some sort of haircut on these deals is the missing element to reduce/eliminate the moral hazard issue.

However, more losses on the debt side are just as likely to start a cascade effect BK’ing a number of other firms as they are to spread the pain equitably.

As I see it today, it’s the CDS problem that rules the decision making process — a la the FNM and FRE CDS neutralization play.

By: David Pearson

David Pearson — Thu, 11 Sep 2008 13:24:00 +0000

Yves,

A thought on the broader implications of Lehman:

Consensus is that the Fed/Treasury will allow the common stock of Lehman to go to zero but bail out creditors -- the same model as Bear, F&F, etc.

The model has unintended consequences. By wiping out common, Treasury is raising the equity risk premium for all financials. This, in turn, is making it harder for financials to recapitalize. No recap's means Treasury has to intervene more often, which wipes out more common, which raises the risk premium. An adverse feedback loop.

By trying to "ring fence" the debt part of bank balance sheets, Treasury is causing banks to fail. Who in their right mind wants to invest in high-risk equity when they can buy no-risk debt?

By: S

Thu, 11 Sep 2008 12:22:00 +0000

Fuld is really hammering those shorts. Citi the last defender on the Street cut their target to 9 from 35. Thanks for the heads up. Now why is Ful still on the NY Fed.