Home › Forums › Financial Markets/Economics › Will the Fed let Lehman Fail?
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cr.
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September 11, 2008 at 9:54 PM #269197September 12, 2008 at 9:44 AM #269313
patientlywaiting
ParticipantIt will be interesting to watch.
http://money.cnn.com/2008/09/12/news/companies/paulson_lehman.ap/index.htm?postversion=2008091212
WASHINGTON (AP) — Treasury Secretary Henry Paulson is against any use of government money to bail out Lehman Brothers Holdings Inc., a person familiar with his thinking said Friday.September 12, 2008 at 9:44 AM #269543patientlywaiting
ParticipantIt will be interesting to watch.
http://money.cnn.com/2008/09/12/news/companies/paulson_lehman.ap/index.htm?postversion=2008091212
WASHINGTON (AP) — Treasury Secretary Henry Paulson is against any use of government money to bail out Lehman Brothers Holdings Inc., a person familiar with his thinking said Friday.September 12, 2008 at 9:44 AM #269550patientlywaiting
ParticipantIt will be interesting to watch.
http://money.cnn.com/2008/09/12/news/companies/paulson_lehman.ap/index.htm?postversion=2008091212
WASHINGTON (AP) — Treasury Secretary Henry Paulson is against any use of government money to bail out Lehman Brothers Holdings Inc., a person familiar with his thinking said Friday.September 12, 2008 at 9:44 AM #269596patientlywaiting
ParticipantIt will be interesting to watch.
http://money.cnn.com/2008/09/12/news/companies/paulson_lehman.ap/index.htm?postversion=2008091212
WASHINGTON (AP) — Treasury Secretary Henry Paulson is against any use of government money to bail out Lehman Brothers Holdings Inc., a person familiar with his thinking said Friday.September 12, 2008 at 9:44 AM #269624patientlywaiting
ParticipantIt will be interesting to watch.
http://money.cnn.com/2008/09/12/news/companies/paulson_lehman.ap/index.htm?postversion=2008091212
WASHINGTON (AP) — Treasury Secretary Henry Paulson is against any use of government money to bail out Lehman Brothers Holdings Inc., a person familiar with his thinking said Friday.September 12, 2008 at 10:12 AM #269357DWCAP
ParticipantI am confused. Wasn’t a major reason to do a BS bailout for BS to protect the counterparty’s. I could be totally wrong, but I thought the logic went something like this:
-Bear fails.
-Sells all assets in firesales to pay debts.
-Market prices appear for MBS/CBO/CDO2 and etc
-Deadweight still in M3 gets repriced
-More institutions start failing due to big lossesIf Lehman goes under, doesn’t that start this all over again, making the Bear bailout pointless cept for the few billion dollar hit the treasury will take??????? Or is Lehman that much smaller than Bear was?
September 12, 2008 at 10:12 AM #269587DWCAP
ParticipantI am confused. Wasn’t a major reason to do a BS bailout for BS to protect the counterparty’s. I could be totally wrong, but I thought the logic went something like this:
-Bear fails.
-Sells all assets in firesales to pay debts.
-Market prices appear for MBS/CBO/CDO2 and etc
-Deadweight still in M3 gets repriced
-More institutions start failing due to big lossesIf Lehman goes under, doesn’t that start this all over again, making the Bear bailout pointless cept for the few billion dollar hit the treasury will take??????? Or is Lehman that much smaller than Bear was?
September 12, 2008 at 10:12 AM #269595DWCAP
ParticipantI am confused. Wasn’t a major reason to do a BS bailout for BS to protect the counterparty’s. I could be totally wrong, but I thought the logic went something like this:
-Bear fails.
-Sells all assets in firesales to pay debts.
-Market prices appear for MBS/CBO/CDO2 and etc
-Deadweight still in M3 gets repriced
-More institutions start failing due to big lossesIf Lehman goes under, doesn’t that start this all over again, making the Bear bailout pointless cept for the few billion dollar hit the treasury will take??????? Or is Lehman that much smaller than Bear was?
September 12, 2008 at 10:12 AM #269643DWCAP
ParticipantI am confused. Wasn’t a major reason to do a BS bailout for BS to protect the counterparty’s. I could be totally wrong, but I thought the logic went something like this:
-Bear fails.
-Sells all assets in firesales to pay debts.
-Market prices appear for MBS/CBO/CDO2 and etc
-Deadweight still in M3 gets repriced
-More institutions start failing due to big lossesIf Lehman goes under, doesn’t that start this all over again, making the Bear bailout pointless cept for the few billion dollar hit the treasury will take??????? Or is Lehman that much smaller than Bear was?
September 12, 2008 at 10:12 AM #269669DWCAP
ParticipantI am confused. Wasn’t a major reason to do a BS bailout for BS to protect the counterparty’s. I could be totally wrong, but I thought the logic went something like this:
-Bear fails.
-Sells all assets in firesales to pay debts.
-Market prices appear for MBS/CBO/CDO2 and etc
-Deadweight still in M3 gets repriced
-More institutions start failing due to big lossesIf Lehman goes under, doesn’t that start this all over again, making the Bear bailout pointless cept for the few billion dollar hit the treasury will take??????? Or is Lehman that much smaller than Bear was?
September 12, 2008 at 10:19 AM #269362cr
ParticipantWill Lehman be bailed out?
[quote=A Paulson source]”There are two things that make this different from Bear Stearns. The market’s been aware of the situation for a long time and has had time to prepare. Second, the Primary Dealer Credit Facility was created by the Fed to allow time for an orderly process,”
“Given these things, (Paulson) is adamant that there will not be government money used in the resolution of the situation,” the source added.[/quote]
So Paulson states adamantly no Government bailout for Lehman.
Given his track record I’d say expect a bailout on Sunday.
His foot in the door is not using Government money, because he will use taxpayer money.
I hope I’m wrong.
Investors who thought they were investing in a sound company were screwed, banks jointly leveraged with Lehman, and insurance companies will be hit too.
September 12, 2008 at 10:19 AM #269592cr
ParticipantWill Lehman be bailed out?
[quote=A Paulson source]”There are two things that make this different from Bear Stearns. The market’s been aware of the situation for a long time and has had time to prepare. Second, the Primary Dealer Credit Facility was created by the Fed to allow time for an orderly process,”
“Given these things, (Paulson) is adamant that there will not be government money used in the resolution of the situation,” the source added.[/quote]
So Paulson states adamantly no Government bailout for Lehman.
Given his track record I’d say expect a bailout on Sunday.
His foot in the door is not using Government money, because he will use taxpayer money.
I hope I’m wrong.
Investors who thought they were investing in a sound company were screwed, banks jointly leveraged with Lehman, and insurance companies will be hit too.
September 12, 2008 at 10:19 AM #269600cr
ParticipantWill Lehman be bailed out?
[quote=A Paulson source]”There are two things that make this different from Bear Stearns. The market’s been aware of the situation for a long time and has had time to prepare. Second, the Primary Dealer Credit Facility was created by the Fed to allow time for an orderly process,”
“Given these things, (Paulson) is adamant that there will not be government money used in the resolution of the situation,” the source added.[/quote]
So Paulson states adamantly no Government bailout for Lehman.
Given his track record I’d say expect a bailout on Sunday.
His foot in the door is not using Government money, because he will use taxpayer money.
I hope I’m wrong.
Investors who thought they were investing in a sound company were screwed, banks jointly leveraged with Lehman, and insurance companies will be hit too.
September 12, 2008 at 10:19 AM #269647cr
ParticipantWill Lehman be bailed out?
[quote=A Paulson source]”There are two things that make this different from Bear Stearns. The market’s been aware of the situation for a long time and has had time to prepare. Second, the Primary Dealer Credit Facility was created by the Fed to allow time for an orderly process,”
“Given these things, (Paulson) is adamant that there will not be government money used in the resolution of the situation,” the source added.[/quote]
So Paulson states adamantly no Government bailout for Lehman.
Given his track record I’d say expect a bailout on Sunday.
His foot in the door is not using Government money, because he will use taxpayer money.
I hope I’m wrong.
Investors who thought they were investing in a sound company were screwed, banks jointly leveraged with Lehman, and insurance companies will be hit too.
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