How the masters of the universe ran amok

[katty]

excerpt/more: http://thescotsman.scotsman.com/latestnews/-How-the-Masters-of.4494032.jp

Flanking him was Hank Paulson, the US treasury secretary, and Tom Geithner, chairman of the New York Fed. It was Geithner who opened the meeting – and presented Wall Street's finest with the fright of their lives.

Either there was a Wall Street rescue for Lehman, or the investment bank would have to face the consequences. An eerie silence ensued.

An analyst at RBS Greenwich in New York summed up the most dramatic meeting of America's top bankers thus: "I thought last weekend was crazy, but this one was even more chaotic.
"Everyone expected to hear by early Sunday evening that the Fed/Treasury had managed to arrange a shotgun wedding for Lehman with someone – Bank of America, Barclays, private equity. A funny thing happened on the way to a deal.

"The New York Fed called in all of the head honchos and said that they had a great deal for them. One lucky participant would get to buy Lehman's business and their 'good' assets for a bargain price.

"The others would get a consolation prize: a chance to contribute their own precious capital to fund a bank of Lehman's 'bad' assets. The Fed and Treasury were said to be 'adamant' that public money would not be involved in any bail-out.

"No government money? OK, no deal."

The meeting set the tone for the weekend. By Saturday morning, more than 100 bankers were involved. Paulson refused to budge on pleas for government underpinning of the Lehman "bad bank" proposal: $41.8 billion (£23.3 billion) of property and up to a further $40 billion of "toxic" assets that had been infected by subprime mortgage loans or derivatives.

Cookies and coffee arrived.

[Vincardog]

1. And today the fed put $70 Billion into the market. But it is not for Lehman

What happened did Lehman give too much to the Democratic candidates?

[katty]

2. who knows, it was just bought by Barclays bank