Lehman Bailout this Weekend (Bear Stearns replay)

[davelj]

99.8% of the world is long financial assets. Yes, the market “should” go down on Monday. Of course it “should” be much lower than it is currently. The Establishment, however, knows that 99.8% of the world is long financial assets and THAT is their constituency. And they will appeal to that constituency. Therefore, expect them to do what they always do: attempt to protect the longs. The shorts and cash horders are the distinct minority and thus irrelevant to the Establishment. Ultimately this pandering will fail, of course. You can put the law of supply and demand on hold for a while, but you can’t suspend it ad infinitum. Nothing would surprise me for Monday. A moonshot OR a total meltdown. Either is possible. But don’t ever forget that the Establishment will do whatever it can to protect its constituency: those long financial assets. If we have a meltdown Monday, it won’t be for lack of effort on the Establishment’s part. It’s just that they will finally have failed and the market will have acknowledged that ultimately economics and markets will trump the Establishment’s voodoo… which can keep people hypnotized for a looooooong time, as we have seen.

[Enorah]

davelji

well said

[Enorah]

davelji

well said

[Enorah]

davelji

well said

[Enorah]

davelji

well said

[Enorah]

davelji

well said

[Bubblesitter]

An update Sunday morning.

I wonder if Paulson was expecting to work so many weekends when he took the job.

http://online.wsj.com/article/SB122139688846233147.html?mod=hpp_us_whats_news

I’m putting the odd of some sort of government bailout aka “backstop” at around 85%. The big banks already have too much exposure to bad mortgage debt and are facing further big writedowns.

Bubblesitter

[Bubblesitter]

An update Sunday morning.

I wonder if Paulson was expecting to work so many weekends when he took the job.

http://online.wsj.com/article/SB122139688846233147.html?mod=hpp_us_whats_news

I’m putting the odd of some sort of government bailout aka “backstop” at around 85%. The big banks already have too much exposure to bad mortgage debt and are facing further big writedowns.

Bubblesitter

[Bubblesitter]

An update Sunday morning.

I wonder if Paulson was expecting to work so many weekends when he took the job.

http://online.wsj.com/article/SB122139688846233147.html?mod=hpp_us_whats_news

I’m putting the odd of some sort of government bailout aka “backstop” at around 85%. The big banks already have too much exposure to bad mortgage debt and are facing further big writedowns.

Bubblesitter

[Bubblesitter]

An update Sunday morning.

I wonder if Paulson was expecting to work so many weekends when he took the job.

http://online.wsj.com/article/SB122139688846233147.html?mod=hpp_us_whats_news

I’m putting the odd of some sort of government bailout aka “backstop” at around 85%. The big banks already have too much exposure to bad mortgage debt and are facing further big writedowns.

Bubblesitter

[Bubblesitter]

An update Sunday morning.

I wonder if Paulson was expecting to work so many weekends when he took the job.

http://online.wsj.com/article/SB122139688846233147.html?mod=hpp_us_whats_news

I’m putting the odd of some sort of government bailout aka “backstop” at around 85%. The big banks already have too much exposure to bad mortgage debt and are facing further big writedowns.

Bubblesitter

[Arraya]

Roubini is scared!!
Money Quote:”If Lehman does not find a buyer over the weekend and the counterparties of Lehman withdraw their credit lines on Monday (as they all will in the absence of a deal) you will have not only a collapse of Lehman but also the beginning of a run on the other independent broker dealers (Merrill Lynch first but also in sequence Goldman Sachs and Morgan Stanley and possibly even those broker dealers that are part of a larger commercial bank, I.e. JP Morgan and Citigroup). Then this run would lead to a massive systemic meltdown of the financial system. That is the reason why the Fed has convened in emergency meetings the heads of all major Wall Street firms on Friday and again today to convince them not to pull the plug on Lehman and maintain their exposure to this distressed broker dealer.”

Go Here: http://tinyurl.com/RMeltdown

[Arraya]

Roubini is scared!!
Money Quote:”If Lehman does not find a buyer over the weekend and the counterparties of Lehman withdraw their credit lines on Monday (as they all will in the absence of a deal) you will have not only a collapse of Lehman but also the beginning of a run on the other independent broker dealers (Merrill Lynch first but also in sequence Goldman Sachs and Morgan Stanley and possibly even those broker dealers that are part of a larger commercial bank, I.e. JP Morgan and Citigroup). Then this run would lead to a massive systemic meltdown of the financial system. That is the reason why the Fed has convened in emergency meetings the heads of all major Wall Street firms on Friday and again today to convince them not to pull the plug on Lehman and maintain their exposure to this distressed broker dealer.”

Go Here: http://tinyurl.com/RMeltdown

[Arraya]

Roubini is scared!!
Money Quote:”If Lehman does not find a buyer over the weekend and the counterparties of Lehman withdraw their credit lines on Monday (as they all will in the absence of a deal) you will have not only a collapse of Lehman but also the beginning of a run on the other independent broker dealers (Merrill Lynch first but also in sequence Goldman Sachs and Morgan Stanley and possibly even those broker dealers that are part of a larger commercial bank, I.e. JP Morgan and Citigroup). Then this run would lead to a massive systemic meltdown of the financial system. That is the reason why the Fed has convened in emergency meetings the heads of all major Wall Street firms on Friday and again today to convince them not to pull the plug on Lehman and maintain their exposure to this distressed broker dealer.”

Go Here: http://tinyurl.com/RMeltdown

[Arraya]

Roubini is scared!!
Money Quote:”If Lehman does not find a buyer over the weekend and the counterparties of Lehman withdraw their credit lines on Monday (as they all will in the absence of a deal) you will have not only a collapse of Lehman but also the beginning of a run on the other independent broker dealers (Merrill Lynch first but also in sequence Goldman Sachs and Morgan Stanley and possibly even those broker dealers that are part of a larger commercial bank, I.e. JP Morgan and Citigroup). Then this run would lead to a massive systemic meltdown of the financial system. That is the reason why the Fed has convened in emergency meetings the heads of all major Wall Street firms on Friday and again today to convince them not to pull the plug on Lehman and maintain their exposure to this distressed broker dealer.”

Go Here: http://tinyurl.com/RMeltdown

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