http://www.nytimes.com/2008/09/15/business/15lehman.html?ref=worldbusiness&pagewanted=print"Lehman was expected to seek bankruptcy protection for its holding company by late Sunday in what would be the largest failure of an investment bank since the collapse of Drexel Burnham Lambert 18 years ago." NYT
-wow ..
From a former para-legal lackey who spent over five years working in Bankruptcy firms, those boys and girls are up to their eyeballs in shXt right now.
If the rumors are true about why Barclays and B.of A. walked away from a rescue purchase ....?
Lehman Brothers may very well be super-duper insolvent. It is extra difficult to create a Bankruptcy protection plan under pressure, without all the facts, and in a situation in which it is difficult to determine where and if there is any "Value" left to protect. It sounds like they might just throw in the towel. Liquidate.
Then what? A trustee to oversee the liquidation. This is why it is called an emergency Bankruptcy filing. I am unsure though whether filing for Bankruptcy protection will truly have any effect, if there is no value left to protect. This sounds like a really bad liquidation. More to follow I am sure.
So, unfortunately this will ultimately lead directly toward more consolidation and risk avoidance type behavior. Consolidation by attrition. Grit your teeth tomorrow, it is going to be a bumpy ride.
--mindbowler
