Lehman Merrill Lynch AIG Fannie Freddie WaMu Madoff Citibank saga

What do you think about current state?

A simple starting point for the discussion:

Contracts protecting $10 million of Lehman debt for one year cost 11 percent upfront and 5 percent a year, according to CMA prices at 8:50 a.m. in New York. That's up from 1,200 basis points at the close of trading yesterday. The price means it costs $1.1 million in advance and $500,000 a year to protect the bonds compared with $1.2 million a year yesterday.
It is an interesting rumor.
Many other about Lehman. Anyway, something would need to be announced quickly (few days). I think it is an intense CDS speculation with those spread ;)
The story looks very similar to Bear's one. I won't be surprised if we will get announce on Sunday that JP Morgan will take over Lehman with Fed support.


Faculty (Undercover)
A sad day down here in lower Manhattan for a whole host of reasons.

It seems Lehman's demise is a foregone conclusion. Is anyone here looking at Washington Mutual? I believe I saw yesterday that CDS on their debt was trading as high as 40% upfront.
Yeah, probably WaMu is the next to go. Maybe not that dramatically as Bear.

Also Merrill is in a pretty bad shape too.


Older and Wiser
If this is true and I can get into Goldman, well, let's just say I'll be a very happy camper.
You will need to be very good because the competition is going to be stiff.
JP Morgan is the only one goes up today.
More and more reporters across the street, looks like there will be big news to be announced today?
I also heard discussion that the Fed would not rescue Lehman because the Treasury just took on a huge responsibility with the Fannie.

Lehman is peanuts for Fed comparing to trillions of $$ exposure in Fannie and Freddie. So, if Fed doesn't bail out LEH there should be another reason.