Posted on 09/11/2008 2:36:55 PM PDT by milestogo
U.S. Government to Arrange Sale of Lehman Brothers
By David Cho and Heather Landy Washington Post Staff Writers Thursday, September 11, 2008; 5:30 PM
The Treasury Department and the Federal Reserve are engineering a sale of Lehman Brothers through a consortium of private firms. The details are not finalized, but sources familiar with the matter say the purchase is expected to be completed and announced this weekend before Asian markets open Monday morning.
Lehman Brothers, which had been anxious to show it could weather the credit crisis that contributed to the firm's $3.9 billion third-quarter loss, said Wednesday that it would sell a majority stake in its investment-management division, slash its dividend and spin off about $30 billion of real estate assets.
(Excerpt) Read more at washingtonpost.com ...
I’ve said it before, and I’ll say it again: President Bush will get *all* of the bad news out into the Public purview before he leaves Office, so as to give his successor an easier job.
ML/NJ
Hey, it’s only money!
And it’s not even FDIC Friday yet!
ping
Too bad the Federal Government is not there to bail is all our of our bad investments.
Only the chosen few have that privilege.
This is bullsht
Call me a pollyanna, but I hope that this is not true. That said, if it DOES happen, I hope the private companies don’t get and federal dollars.
I guess I AM a pollyanna!!!
Someone fill me in here — why is the gubmint involved?
It's for the good of everyone, comrade
Seriously — the firm is comprised of very, very smart guys who are more than capable of doing a deal.
So, why is the gubmint involved in this?
“Lehman Brothers, which had been anxious to show it could weather the credit crisis that contributed to the firm’s $3.9 billion third-quarter loss, said Wednesday that it would sell a majority stake in its investment-management division, slash its dividend and spin off about $30 billion of real estate assets.”
The money line. They thought they could hang on long enough to get bailed out, $3.9 billion loss? who beside the government is going to buy a majority share?, slash its dividend after losing $3.9 billion? What dividend? “spin off”? sounds like a fire sale to the feds.
Washington Post has changed the headline and opening to the story:
U.S. Government Assisting in Sale of Lehman Brothers
The Treasury Department and the Federal Reserve are helping Lehman Brothers put itself up for sale. The details are not finalized, but sources familiar with the matter say the purchase is expected to be completed and announced this weekend before Asian markets open Monday morning.
The Fed and Treasury are talking to a wide range of firms and examining multiple scenarios for the sale of the venerable investment brokerage.
They’re gonna have to rent Madison Square Garden to hold all the lawyers and accountants involved....
My guess is the Treasury and Fed must be offering some guarantees like they did with Bear Sterns.
Not that I think the Feds should take over Lehman, but if they arrainge a “Bear STearns like” sale, that would not be too bad. Shareholders/employees of Bear got hit pretty hard, not much of a bailout. On Jan 1, Bear stock was at $85, June 2nd, sold for $10. The Federal Reserve did take on more risk to hold risky assets, but Bear is now owned by JP Morgan, not the US govt.
Probably because they don't see financial collapse and widespread deprivation as a solution to the problem.
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