Comments on: Lehman Asked to Become a Bank, Rebuffed by Fed http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-bank-rebuffed-by.html Mon, 23 Nov 2009 02:08:55 -0500 http://wordpress.org/?v=2.8.4 hourly 1 By: doc holiday http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-bank-rebuffed-by.html#comment-19713 doc holiday Mon, 06 Oct 2008 15:21:00 +0000 http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-a-bank-rebuffed-by-fed/#comment-19713 It is criminal that these IBs like Goldman can be banks now -- utterly retarded, because, IBs like Goldman have tons of derivatives directly linked to unregulated commodity speculation -- which obviously is something you do not want your savings account linked to. How fuc-ing stupid is our government, how corrupt?? This is an awful, awful situation made worse by these retarded slobs! It is criminal that these IBs like Goldman can be banks now — utterly retarded, because, IBs like Goldman have tons of derivatives directly linked to unregulated commodity speculation — which obviously is something you do not want your savings account linked to. How fuc-ing stupid is our government, how corrupt?? This is an awful, awful situation made worse by these retarded slobs!

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-bank-rebuffed-by.html#comment-19687 Anonymous Mon, 06 Oct 2008 12:14:00 +0000 http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-a-bank-rebuffed-by-fed/#comment-19687 This is what happens when one of the key regulators -- Paulson -- is the former head of Lehman's chief competitor. Who is to say that it wasn't Paulson's personal animus towards Lehman that caused the denial? This is what happens when one of the key regulators — Paulson — is the former head of Lehman’s chief competitor. Who is to say that it wasn’t Paulson’s personal animus towards Lehman that caused the denial?

]]> By: Yves Smith http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-bank-rebuffed-by.html#comment-19665 Yves Smith Mon, 06 Oct 2008 09:02:00 +0000 http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-a-bank-rebuffed-by-fed/#comment-19665 I agree that this does not add up, which makes me wonder if this was yet another desperation move by the Fed. Your point re the cost of Goldman's funding is valid. But it could have been seen differently, or perhaps more accurately, served as useful cover. I agree that this does not add up, which makes me wonder if this was yet another desperation move by the Fed. Your point re the cost of Goldman’s funding is valid. But it could have been seen differently, or perhaps more accurately, served as useful cover.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-bank-rebuffed-by.html#comment-19664 Anonymous Mon, 06 Oct 2008 08:47:00 +0000 http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-a-bank-rebuffed-by-fed/#comment-19664 If my bank were issuing debt at 10% I would be worried, and certainly not point to it as proof of solvency, or liquidity.<br/><br/>Lehman knew where it stood in line, behind merrill, which was faced with the same decision. Thain took the only way out that was offered, Fuld did not have any options at that point, and should have recognized that. If my bank were issuing debt at 10% I would be worried, and certainly not point to it as proof of solvency, or liquidity.

Lehman knew where it stood in line, behind merrill, which was faced with the same decision. Thain took the only way out that was offered, Fuld did not have any options at that point, and should have recognized that.

]]> By: Yves Smith http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-bank-rebuffed-by.html#comment-19663 Yves Smith Mon, 06 Oct 2008 08:34:00 +0000 http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-a-bank-rebuffed-by-fed/#comment-19663 I am not certain the Buffett investment made the diference, but it sure didn't hurt. Morgan Stanley and Goldman were considered to be in better shape than Lehman, so the Fed would be more predisposed to consider them.<br/><br/>But conversely, the failure of Lehman to raise any dough when it had been flailing around for so long would be a red flag. I cannot prove that a KDB investment would have secured approval, but it would have helped the odds, or may have kicked the can down the road until Morgan and Goldman came on bended knee too. I am not certain the Buffett investment made the diference, but it sure didn’t hurt. Morgan Stanley and Goldman were considered to be in better shape than Lehman, so the Fed would be more predisposed to consider them.

But conversely, the failure of Lehman to raise any dough when it had been flailing around for so long would be a red flag. I cannot prove that a KDB investment would have secured approval, but it would have helped the odds, or may have kicked the can down the road until Morgan and Goldman came on bended knee too.

]]> By: Anonymous http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-bank-rebuffed-by.html#comment-19662 Anonymous Mon, 06 Oct 2008 08:25:00 +0000 http://www.nakedcapitalism.com/2008/10/lehman-asked-to-become-a-bank-rebuffed-by-fed/#comment-19662 5 Billion from Buffett at 10% was enough to change their mind? That is what instills confidence these days? Does that mean that the real rate of interest is above that? Banks borrow cheap and lend expensive, in the simplest of terms. Very confused...<br/><br/>I really still don't see how they can be called banks.<br/><br/>Remember when the SWF's were still around, they were good for dozens of billions... 5 Billion from Buffett at 10% was enough to change their mind? That is what instills confidence these days? Does that mean that the real rate of interest is above that? Banks borrow cheap and lend expensive, in the simplest of terms. Very confused…

I really still don’t see how they can be called banks.

Remember when the SWF’s were still around, they were good for dozens of billions…

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