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Posted
Sep 05 2008, 07:05 AM
by
Douglas McIntyre
Rating:
If the markets are to take bond guru Bill Gross at his word, the world's financial markets could go through a cataclysmic failure. The head of fixed income fund operation Pimco says that a rapid sale of assets by banks, brokers, and hedge funds will cause the credit system to collapse. Almost all of these companies need cash and none of them wants to be left holding the bag if housing and commercial markets go to pieces.
The unusually eloquent Gross recently wrote "This rarely observed systematic debt liquidation is what confronts the U.S. and perhaps even the global financial system at the current time. Unchecked, it can turn a campfire into a forest fire, a mild asset bear market into a destructive financial tsunami."
Gross wants the US Treasury to move into the market and buy distressed assets to stop the knife from falling.
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Posted
Aug 19 2008, 10:45 PM
by
Andrew Horowitz
Rating:
 It has been a tough time for shareholders that remain invested in financials and in particular, Lehman Brothers remains in the cross-fire. The main problem continues to be the company's cavalier attitude and total disregard for their shareholder's net worth.
Unfortunately, the latest finding estimates another $4 billion of potential write-downs for the quarter and is just one more in the long list of the obscene losses plaguing this once respected company. Aside from the obvious financial problems, Lehman has a continuing PR debacle created out of an obstinate attitude and a general feeling of indestructibility. At this point, I can't decide if it is either a case of a total disconnect from reality or the notion that they have a guardian angel promising a safety net. Why else would they continue to be so reckless with their announcement and why would they be so insistent on hiding the real story from shareholders?
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Posted
Aug 18 2008, 06:57 PM
by
Matt Koppenheffer
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We've seen a lot of wild things in the stock market over the past few years. Homebuilders have completely crashed and burned, banks and other financial companies are treading water at best, retail stocks have been punished, and the dollar has been in freefall. And all this while commodities from gold to wheat to oil have been skyrocketing.
But it may get just a bit wilder now that whole scenario has been flipped on its head. Financials have had fitful rallies, the dollar is showing some definite life, and oil has been sliding. While this could lead to a number of different outcomes, on The Motley Fool's CAPS service CAPS blogger RVAspeculator thinks that this turn of events is delivering a sucker punch to some hedge funds and Wall Street trading desks.
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Posted
Jul 16 2008, 05:35 AM
by
Douglas McIntyre
Newly-minted legend says that short-selling put Bear Stearns out of business and has swamped the stock prices of Lehman , Fannie Mae , and Freddie Mac. To keep evil from further invading the stock markets, short-selling should be put to sleep.
According to The Wall Street Journal, "In a dramatic emergency order, the SEC said it would immediately move to curb improper short selling in the stocks of struggling mortgage giants Fannie Mae and Freddie Mac, as well as those of 17 financial firms, including Goldman Sachs Group, Lehman Brothers Holdings, Morgan Stanley and Merrill Lynch."
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Posted
Jul 14 2008, 11:53 AM
by
Todd Harrison
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Hello from New York, where I don't much care how they "fix" Fannie Mae or Freddie Mac, but the related witch hunt to crack down on "rumor mongering" has me frothing at the mouth.
I expect the government to use whatever means they have at their disposal to ensure the smooth operations of the financial markets. You may approve or disapprove of the government behaving in such a manner but you can't deny that there is precedent for such manipulation (see: Long Term Capital, Bob Rubin's October '98 Bear Slaughter, Last August's manipulations, etc. et al).
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Posted
Jul 03 2008, 10:23 AM
by
Matt Koppenheffer
Rating:
In an unusual move, Lehman Brothers decided to try and engender some employee goodwill by handing out a mid-year bonus. Unfortunately, it was in stock. Worse still, it was in Lehman stock.
Now before you go and assume that this is a bad idea because Lehman stock has been so badly beaten up, let's be clear -- this is bad for a whole lot of reasons. And instead of getting hung up on minutiae like whether it's really an incentive when you're handing out shares of a plummeting stock, think about what this says about the bigger picture at Lehman.
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Posted
Jun 26 2008, 01:18 AM
by
Jon Markman
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It’s easy to imagine that the 25 best-performing stocks in the S&P 500 Index this year are all oil and gas producers, and the 25 worst-performing stocks are all banks and brokers. Yet as we near the halfway mark in 2008, it turns out that there are quite a few surprises in the mix of best and worst.
For instance, the No. 1 stock in the benchmark index this year isn’t an oil producer, but a coal miner, Massey Energy. It’s up 155% so far, rising to $89 from $35 as coal prices have soared in the wake of booming demand in China and India. The No. 2 stock is actually a discount retailer, Big Lots. It’s up 100%, from $15 to $30, as investors speculate it will get a big share of tax-rebate money from low-income Americans.
Most of the rest of the next best 15 gainers
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Posted
Jun 13 2008, 07:46 AM
by
Andrew Horowitz
Rating:
Lehman Brothers sent another "feel-good" letter to their clients that hold positions in Lehman sponsored partnerships. This isn't the first of these smokescreens that Lehman published in an attempt to take our eyes off of the real problems. Is it me or is it terribly concerning how gullible many of these companies believe that we are? I still have not hear an apology for the blatant and disrespectful lies misinformation that was promoted by the overzealous PR team over at Lehman HQ.
Below is the June 11 letter and my comments....
LEHMAN BROTHERS
399 PARK AVENUE, NEW YORK NY 10022 TELEPHONE (212) 526-0977 FACSIMILE (646) 758-4269
MICHAEL J. ODRICH, MANAGING DIRECTOR, HEAD OF PRIVATE EQUITY
Dear Partner:
As the second quarter comes to a close, financial markets remain under stress. Actions taken by the Federal Reserve have provided additional stability for capital markets, although the operatin
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Posted
Jun 05 2008, 02:50 PM
by
Matt Koppenheffer
Rating:
Are we going to get an encore showing of "The Amazing Disappearing Investment Bank?" Now that Bear Stearns is no more, the banking bears and short sellers have turned their attention to fellow investment bank Lehman Brothers.
With the massive leverage ratios that the investment banks have propped themselves on, creditor confidence has become a prized asset -- maybe the prized asset. There was plenty that was going haywire over at Bear, but it ended up being a complete and rapid drying up
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Posted
Jun 02 2008, 04:32 PM
by
Andrew Horowitz
Rating:
What took them so long? S&P finally trimmed their outlook on Lehman
Brothers Corp and other key financials today. It has become clear that the problems facing the financial sector is far from over. Financial stocks and the markets in general were hit hard as investors were spooked after S&P announced that
they would be lowering ratings and their outlook on these companies. Is this any surprise to anyone? So now, the long term ratings on these three went from A+ to A and the short term rating went to
A-1. The concerns seem to be focussing in on residential mortgage
loans and residential construction slow downs. Timely, hey? According to the S&P release shown below, “The downgrade primarily
reflects our concern that the pace and extent of earnings improvement
could be considerably more muted than we previously assumed.” And "muted" is codeword for....?
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