Breaking News

[luv2read]

Everything is rosy, eh?

•Fed Beige Book Says Economy `Slow' in Most Regions as Consumer Prices Rise (http://www.bloomberg.com/apps/news?pid=20601087&sid=awVZkMAl2xJQ&refer=home)
•GMAC, Rescap Will Eliminate 5,000 Jobs, Shut Network of 200 Retail Offices (http://www.bloomberg.com/apps/news?pid=20601087&sid=a1Gr65hw_HbA&refer=home)
•U.S. Stocks Drop, Led by Technology Companies; Corning Tumbles on Forecast (http://www.bloomberg.com/apps/news?pid=20601087&sid=alHhZtBairMQ&refer=home)
•GM, Ford U.S. Auto Sales Slump as Truck Demand Plunges on Gasoline Prices (http://www.bloomberg.com/apps/news?pid=20601087&sid=ahcgxxogVyDo&refer=home)
•Clear Channel Banks Seeking to Sell $980 Million of Leveraged Buyout Debt (http://www.bloomberg.com/apps/news?pid=20601087&sid=af4nQHuJVEcg&refer=home)
•Ex-Credit Suisse Brokers Charged With Fraud for `Bait and Switch' Tactics (http://www.bloomberg.com/apps/news?pid=20601087&sid=a4JUFaTv2spQ&refer=home)
•BlackRock Seeking $3 Billion for Second Fund to Buy Discounted Bank Loans (http://www.bloomberg.com/apps/news?pid=20601087&sid=aOhtW8ip0y7A&refer=home)


More churning....how about Fanny and Freddie while you're at it, BlackRock?

[James48843]

Looks like Blackrock wants to pick up some of fanny and freddie's merchandise.

[luv2read]

Thats what I was thinking...saw my comments on the other threads?

[luv2read]

UPDATE 2-Lehman credit spreads widen amid KDB speculation

Fri Sep 5, 2008 9:55am EDT

(Updates with quote, stock moves)
NEW YORK, Sept 5 (Reuters) - The cost to insure debt of Lehman Brothers rose on Friday amid doubts about the likelihood of an acquisition of the investment bank by state-controlled Korea Development Bank [KDB.UL].
KDB has declined to give any details of negotiations and other Korean banks touted as being part of a consortium have denied interest. For details see [ID:nSP115462].
Japan's Mitsubishi UFJ Financial Group also said this week it has no plans to invest in Lehman, denying a media report that it may bid for a stake in the subprime mortgage-hit U.S. investment bank. [ID:nT164730]
In addition, analysts said Lehman management may be considering plans other than a deal with KDB to shore up the faltering company, including spinning off its commercial mortgage securities into a new company. [ID:nBNG260574]
"Such a move would require the company to attract fresh capital, as the firm would inject one quarter of the equity directly and the remainder would come from debt provided by Lehman and other investors," Barclays Capital said in a report on Friday.
Lehman's credit default swaps rose 20 basis points to 345 basis points, or $345,000 per year for five years to insure $10 million in debt, from 325 basis points on Thursday, according to Phoenix Partners Group.
Shares in Lehman edged down about 0.6 percent in early trading to $15.10. (Reporting by Walden Siew; Editing by Jonathan Oatis)

[luv2read]

September 5, 2008
Lehman Weighs Split to Shed Troubling Loans
By BEN WHITE and JENNY ANDERSON (http://topics.nytimes.com/top/reference/timestopics/people/a/jenny_anderson/index.html?inline=nyt-per)
Lehman Brothers (http://topics.nytimes.com/top/news/business/companies/lehman_brothers_holdings_inc/index.html?inline=nyt-org), the ailing Wall Street bank, is working toward a radical solution in its fight for survival: Splitting itself into a “good” bank and a “bad” one.
Lehman, which has been searching for a financial lifeline from outside investors, is contemplating placing about $30 billion of troublesome commercial mortgages and real estate that it owns into a new publicly traded company — the “bad” bank. The rest of Lehman — the “good” one — would then be able to carry on with the help of a cash infusion from one or more investors.
The move is one of several under consideration as Lehman prepares to report what could be grim third-quarter results this month. But the good bank/bad bank idea is hardly new. Several troubled financial institutions took similar steps in the late 1980s and early 1990s.
If Lehman goes through with the plan, the firm itself would probably inject $6 billion to $8 billion in equity into the new company, people briefed on the matter said Thursday. Lehman would also provide debt financing for the company and could raise additional money from outside investors, who would benefit from any recovery in the market for commercial and residential real estate assets. A spokeswoman for Lehman declined to comment.
The fate of Lehman is one of the biggest questions hanging over Wall Street, where concern about the health of the financial industry and the broader economy sent the Dow Jones industrial average into a 345-point tailspin on Thursday.
Lehman, among the largest underwriters of mortgage-backed securities, has been brought to its knees by the running credit crisis. The firm’s hard-charging leader, Richard S. Fuld Jr. (http://topics.nytimes.com/top/reference/timestopics/people/f/richard_s_fuld_jr/index.html?inline=nyt-per), has been trying to sell some of the bank’s troubled commercial mortgage holdings, but has failed to find enough buyers.
Lehman’s next results are likely to underscore its precarious position. Analysts expect the firm to write-down as much as $5 billion of commercial real estate holdings and to post a loss of $2.49 a share.
Splitting off troubled assets would help Lehman attract new investors, many of whom have been reluctant to put money into the troubled financial industry.
Lehman has been negotiating to sell part of itself to the government-owned Korea Development Bank or other investors in Asia. While no deal has been reached, many analysts think one will materialize soon. Lehman is also considering selling its prized investment management arm, which includes Neuberger Berman, for about $7 billion, possibly to a private equity group like Apollo or Kohlberg Kravis Roberts (http://topics.nytimes.com/top/news/business/companies/kohlberg_kravis_roberts_and_co/index.html?inline=nyt-org).
If Lehman were to create a good/bad bank structure it would probably need to raise fresh capital to replace the money it would inject into the bad bank.
In June, Lehman tapped a group of American institutional investors for $6 billion when it announced second-quarter results. But its shares have dropped 44 percent since then, making another similar capital-raising unlikely. Shares of Lehman fell $1.77, or 10.5 percent, to close at $15.17 on Thursday.
In 1988, Mellon Bank, weighed down by bad real estate loans, created Grant Street National Bank to offload troubled loans. Mellon sold 191 loans, once worth about $1.4 billion, for $640 million to the new entity and took a one-time, pretax charge of about $200 million.
Every Mellon shareholder was given one share in the new entity. To finance the entity, Mellon put in about $125 million and Grant Street tapped the markets for an additional $513 million in junk bonds. The notes were paid off before they matured and the entity was shut down in 1995.
“Everybody got paid back and there was money left over for shareholders,” said Michael Bleier, a lawyer with Reed Smith in Pittsburgh, and former general counsel at Mellon Bank. “Mellon got the assets off its balance sheet and that improved the quality of the portfolio over all and the quality of the good bank,” he said.
David Trone, an analyst with Fox-Pitt Kelton, endorsed the idea of Lehman spinning off its commercial real estate for shareholders.
In a research note on Thursday, Mr. Trone said the issue for Lehman management was not so much one of troubled assets, but rather the fact that uncertainty surrounding the portfolio was weighing down Lehman’s stock.
“Management is in a quandary — the commercial mortgage is performing too well to be dumped in a fire sale but, yet on the other hand, the equity market appears to want it gone,” he wrote.
Creating the separate company, the thinking goes, would strengthen the confidence of people who do business with Lehman every day — other banks, hedge funds and institutions like pension funds — thereby encouraging them to continue doing business with the firm. Shareholders, who would own shares of both the real estate portfolio and the new unencumbered Lehman, could bet on whether the commercial real estate market recovers or gets worse and sell its “bad bank” shares.
Mr. Trone estimated that if Lehman spun off a separate entity, it would invest about $3.6 billion in equity. It would then have to raise a significant amount of debt — a problem, Mr. Trone said, as corporate debt holders might not be comfortable assessing a commercial mortgage portfolio and commercial mortgage holders might not want corporate debt.
Lehman will have to decide how much it wants to capitalize the new company, but it will most likely seek to overcapitalize it to give the new entity enough of an equity cushion to absorb more market punches and have the flexibility to sell the assets when the markets are in better shape.

[luv2read]

Re the two posts below...Keep in mind that BlackRock has made it known it has $3B to spend on bad stuff......

[tsptalk]

September 5, 2008
Lehman Weighs Split to Shed Troubling Loans
By BEN WHITE and JENNY ANDERSON (http://topics.nytimes.com/top/reference/timestopics/people/a/jenny_anderson/index.html?inline=nyt-per)
Lehman Brothers (http://topics.nytimes.com/top/news/business/companies/lehman_brothers_holdings_inc/index.html?inline=nyt-org), the ailing Wall Street bank, is working toward a radical solution in its fight for survival: Splitting itself into a “good” bank and a “bad” one.
Don't forget your links when posting articles. :) Thanks!

[luv2read]

sorry got cut off.

Lehman Weighs Split to Shed Troubling Loans (http://www.nytimes.com/2008/09/05/business/05lehman.html)
By BEN WHITE and JENNY ANDERSON
The ailing Wall Street bank is working toward a radical solution in its fight for survival: Splitting itself into a “good” bank and a “bad” one.
September 5, 2008

http://topics.nytimes.com/top/reference/timestopics/people/a/jenny_anderson/index.html?inline=nyt-per

[alevin]

http://treasury.gov/press/releases/hp1129.htm Text of Paulson's speech today on gov taking over the GSEs. 5.2 trillion in new debt. Lot of mixed chatter elsewhere about where the market goes tomorrow ST, and mixed lprognoses ongerterm by end of 09 too. Cointoss for tomorrow, my best guess, altho weekly PSAR for SPX and EMW says coming week should be up-we'll see, I've been fooled before by PSAR. :confused: Haven't decided what I'll do yet., that 2day up and 3dday down pattern is a killer for less-spontaneous/more analytical me.

No bets on F, but my hunch is down, regardless of equity direction. We've had a few other days where both went down same time, so I wouldn't be surprised if that does happen.

[poolman]

http://treasury.gov/press/releases/hp1129.htm Text of Paulson's speech today on gov taking over the GSEs. 5.2 trillion in new debt. Lot of mixed chatter elsewhere about where the market goes tomorrow ST, and mixed lprognoses ongerterm by end of 09 too. Cointoss for tomorrow, my best guess, altho weekly PSAR for SPX and EMW says coming week should be up-we'll see, I've been fooled before by PSAR. :confused: Haven't decided what I'll do yet., that 2day up and 3dday down pattern is a killer for less-spontaneous/more analytical me.

No bets on F, but my hunch is down, regardless of equity direction. We've had a few other days where both went down same time, so I wouldn't be surprised if that does happen.


This is what I was thinking. If we go down tomorrow, Everything is going down. :(

[nnuut]

If we are down tomorrow I think we will hear a loud sucking sound from all funds to the "G". I hope the FRTIB likes that sound. They will probably get rid of the "G" in the future knowing how just smart they are? 4610

[prudence]

This is what I was thinking. If we go down tomorrow, Everything is going down. :(


I have 19% in L fund
30 in C fund.
30 in I

What is opinion about C fund because I believe that is the fund that is affected by fannie mae and freddie mac.:)

[Frixxxx]

If we are down tomorrow I think we will hear a loud sucking sound from all funds to the "G". I hope the FRTIB likes that sound. They will probably get rid of the "G" in the future knowing how just smart they are?

Once again, I must insist, DO NOT GIVE THE FRTIB ANY IDEAS!!!!!!:nuts:

[nnuut]

Is this one next?:mad:

Reserve's money fund 'breaks the buck'

The world's first money-market fund's $62B in assets fall below a safety benchmark due to soured investments in Lehman.

Last Updated: September 17, 2008: 2:55 PM EDT

BOSTON (AP) -- The assets of a money-market fund that held $62 billion three months ago have fallen below a safety benchmark intended to ensure investors who put money in can get it all back - just the second unsettling instance in which a fund has exposed investors to potential losses in the nearly four-decade history of money-market funds.
Reserve Management Co.'s (http://www.reservefunds.com/) announcement that its Reserve Primary Fund had "broken the buck" after its assets fell sharply because of soured investments in Lehman Brothers Holdings Inc. marked the first such investor exposure to money-market losses since 1994.
New York-based Reserve said the value of $785 million in debt securities issued by Lehman and held by the Primary Fund were written down to zero as of Tuesday afternoon - a consequence of Lehman's collapse and bankruptcy after the federal government failed to bail out the investment bank over the weekend.
Money-market funds normally maintain assets of at least $1 for every dollar invested in funds, and are supposed to return interest to investors in the form of dividends.
Money funds not backed by FDIC [more]
http://money.cnn.com/2008/09/17/pf/bc.apfn.investorrisk.fal.ap/index.htm?postversion=2008091714

[James48843]

Now we are going to see some real serious trouble.

[Gumby]

Now we are going to see some real serious trouble.


Domino effect? or Nuclear fallout?

[Frixxxx]

Now we are going to see some real serious trouble.
Do NOT be fooled by the GREEN tomorrow...it will be just the fool's rallly be fore Friday. I hope I'm wrong....It's just this: I see no support for anything.:cool:

[ATCJeff]

Do NOT be fooled by the GREEN tomorrow...it will be just the fool's rallly be fore Friday. I hope I'm wrong....It's just this: I see no support for anything.:cool:

Starting to agree.

BTW, I have never seen Cramer so bearish. He thinks we are heading down.

[Fivetears]

World Bank Under Cyber Siege in 'Unprecedented Crisis'
The World Bank Group's computer network — one of the largest repositories of sensitive data about the economies of every nation — has been raided repeatedly by outsiders for more than a year, FOX News has learned.

It is still not known how much information was stolen. But sources inside the bank confirm that servers in the institution's highly-restricted treasury unit were deeply penetrated with spy software last April. Invaders also had full access to the rest of the bank's network for nearly a month in June and July.

In total, at least six major intrusions — two of them using the same group of IP addresses originating from China — have been detected at the World Bank since the summer of 2007, with the most recent breach occurring just last month.

In a frantic midnight e-mail to colleagues, the bank's senior technology manager referred to the situation as an "unprecedented crisis." In fact, it may be the worst security breach ever at a global financial institution. And it has left bank officials scrambling to try to understand the nature of the year-long cyber-assault, while also trying to keep the news from leaking to the public.

http://www.foxnews.com/story/0,2933,435681,00.html

[James48843]

BREAKING NEWS...


THE NEWS...is broken.

So is my TSP account balance.

Broke.

[squalebear]

BREAKING NEWS...


THE NEWS...is broken.

So is my TSP account balance.

Broke.

Thats right folks, you heard it here first !
Fair, Balanced, and Broke as Hell ! :toung:

[alevin]

http://www.atimes.com/atimes/Global_Economy/JK01Dj02.html

Cool! I might be able to completely bypass upgrading to Microsoft Vista after all!

Vista-free outlook for Microsoft
By Martin J Young

HUA HIN, Thailand - Microsoft has been touting its latest version of Windows this week and moved closer to dropping the much-derided Vista operating system by the wayside. Windows 7, expected in early 2010, will be built on Vista but, according to chief executive Steve Ballmer, it will be a lot better.Microsoft claims to have solved all of these glitches and is looking forward to Windows 7, while slowly pushing Vista under the rug.

Windows 7 is likely to be the operating system that Vista should have been

I managed to buy my first PC right when Win95 came out and upgraded direct to XP from there when could no longer update internet security software re WIN95. Now I may be able to go direct from XP to WIN7 when they roll it out. Cool! :cool:

[XL-entLady]

http://www.atimes.com/atimes/Global_Economy/JK01Dj02.html

I might be able to completely bypass upgrading to Microsoft Vista after all!

Cool! :cool:
For Microsoft, it's either 'get rid of Vista' or 'continue to allow Vista to be the best reason to give Apple a harder look' from a marketing standpoint. Vista should come packaged with blood pressure medication! :laugh:

I wonder if those of us stuck with the reviled operating system will have to pay to upgrade to something that works?! :suspicious: :rolleyes:

Lady

[PessOptimist]

For Microsoft, it's either 'get rid of Vista' or 'continue to allow Vista to be the best reason to give Apple a harder look' from a marketing standpoint. Vista should come packaged with blood pressure medication! :laugh:

I wonder if those of us stuck with the reviled operating system will have to pay to upgrade to something that works?! :suspicious: :rolleyes:

Lady

Likely as Microsoft doesn't give away much for free.

Wait until your agency decides to upgrade to Office 2007. Suddenly none of your macros or secured files will work. You will even have to ask permission to see the files that are not secured or have no macros. Oh, by the way the upgrade will send any shortcut it doesn't like to the trashcan.

[wv-girl]

from http://www.247wallst.com/2008/11/citigroup-c-fin.html

on MarketWAtch. com

Barclay's may be in trouble.



At last Citigroup (C) has decided to do something to save itself beyond having town hall meetings and firing tens of thousand of people.
Thursday, shares of the big bank fell to a low of $4.39. In the summer of 2007, that stock traded about $52.
Finally, Citi has determined that it may not have the people or the balance sheet to stay in business on its own.
According to (http://online.wsj.com/article/SB122722907151946371.html?mod=testMod) The Wall Street Journal, "Executives at Citigroup Inc., faced with a plunging stock price, began weighing the possibility of auctioning off pieces of the financial giant or even selling the company outright, according to people familiar with the matter."
Citi's board may be looking at the difficulty that Barclays (BCS) is having raising $10 billion in new capital. Some large shareholders are against the pricing and dillution which would come from the deal, and the plan to issue shares may be voted down. If that happens, Barclays is in real trouble having lost access to a huge new pool of capital"

[Dr Faustus]

Gee, if that happens, we could be down to 2 IFTs a year!

[jon]

Paulson is too soft on his financial buddies. He offers huge help with insufficient public protection and payback. He needs to resign along with the whole Bush administration within 2 weeks. Obama could temporarily keep key Bush appointees and offer all Bush key players an additional early severance package of 1 extra month salary beyond inaguration date to resign in 2 weeks.

Dr. Faustus, sorry for not responding to your reply about a week ago regarding my NASA recycling comments. I was not suggesting that we or anybody else collect space garbage and return it to earth. Rather extend international cooperation beyond the ISS to broad agreements on standard sizes and building designs for all commercial satellites. When they stop working collect them in a space junkyard. Add a recycling/fabrication facility on to or separate from the ISS and reuse standard parts from the old satellites, etc to then build and launch new satellites, etc in space from the fab facility.

[alevin]

http://www.ibtimes.com/articles/20081128/us-interbank-lending-rates-up-for-2nd-day-running.htm


The rate on three-month loans in dollars--known as the London Interbank Offered Rate, or Libor--rose over 0.01 percentage points to 2.22 percent, according to the British Bankers' Association.


Still a lot lower than it was several months ago @5%+. Maybe just maybe it will stay down in a lower range for awhile. Maybe.