Tag Archives | Lehman Brothers

Commemorating the Financial Crisis: It Ain’t Over Yet

Lehman Brothers Headquarters on Bankruptcy Day. Photo:Robert Scoble (CC)

Lehman Brothers Headquarters on Bankruptcy Day. Photo: Robert Scoble (CC)

Media outlets love anniversaries. They become the makers and newspegs for one day stories that become pretexts for episodic coverage of key issues that substitute for ongoing critical reporting.

It’s a ‘how are we doing coverage ‘ that aims to give us a grade but not look too closely at the causes..

So, no surprise, the President will mark the occasion this week, with, what else—a speech, really remarks aimed at providing a positive spin for a series of economic disasters that we have yet to climb out of.

Reuters reports:

“A White House official said Obama will deliver remarks in the White House Rose Garden on Monday to mark the fifth anniversary of the financial crisis, which was accelerated on September 15, 2008 when the Lehman Brothers firm filed for bankruptcy protection.

The Democratic president will focus on the positive, discussing progress made and highlighting his prescriptions for boosting job creation amid budget battles expected with Republicans in Congress in the weeks ahead.”

Never mind that that venerable bank, Bear Stearns went down a year earlier in 2007, and that consumers were being targeted by financial predators pedaling subprime loans and other financial frauds for many years earlier.… Read the rest

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Lehman Channeled Risks [i.e. Investors' Money] Through ‘Alter Ego’ Firm

Dr. Jekyll & Mr. HydeThe top headline of the front page of the New York Times remains unaltered in my story headline, except for what the word “risk” really means. In my mind the sense of an “alter ego” sounds like a horror story, not a financial or economic one…

LOUISE STORY and ERIC DASH report in the New York Times:

In the years before its collapse, Lehman used a small company — its “alter ego,” in the words of a former Lehman trader — to shift investments off its books.

The firm, called Hudson Castle, played a crucial, behind-the-scenes role at Lehman, according to an internal Lehman document and interviews with former employees. The relationship raises new questions about the extent to which Lehman obscured its financial condition before it plunged into bankruptcy.

While Hudson Castle appeared to be an independent business, it was deeply entwined with Lehman. For years, its board was controlled by Lehman, which owned a quarter of the firm.

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Lehman Brothers Was More Dangerous Than Enron

Lehman Brothers Are Crooks That Were Not CaughtHere's an excellent explanation from The Dylan Ratigan Show of an arcane "accounting gimmick", employed by Lehman Brothers as the firm failed in 2007 and 2008. According to the 2,200-page court examiner’s report this practice, known as "Repo 105" ("Repo"? Really, why not call it "Steal 105"?), was like "a drug" propelling the bank to conceal the true nature of its financial health. The collapse of "venerable" Wall Street investment house Lehman Brothers was the largest bankruptcy in U.S. history. Here's Dylan Ratigan and Eliot Spitzer making sense of what is clearly a crime against the economic health of the United States:
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The September Employment Rate is 90%

By Robert Singer

The U.S. Department of Labor Official Employment rate in September 2009 is now 90% (Unofficial rate is 75%).

And for those Americans who are still employed, they will find it harder to get that sweet deal on a new car because auto dealers won’t be competing with each other now that Brian Deese, special assistant to president Obama for economic policy made the decision (not the Chrysler bankruptcy judge), to close dealerships without regard to profitability.

Deese, age 31, in his first government position, shuffles back and forth from the West Wing to the Treasury Department dismantling the US Auto Industry and rewriting the rules of American “capitalism”. [1]

Deese’s first rule: Withdraw Credit and Liquidity.

Result – Catch 22:

The pullback in spending causes companies to cut back on inventory and staff – Creating unemployment.

Which causes spending to fall and companies to cut back on inventory and staff -Creating more unemployment.… Read the rest

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