Quote:
Originally Posted by NoComments
well,
I just got word from the broker that LEH is calling one of 2 CD's back on March 20th, but even if they didn't, both CD's are FDIC insured, thus even if they go under, yours truly won't suffer much.
My biggest holding in banks is Bank of America, the biggest of them all in USA.
If they fail, the life the way we know will seize to exist anyway, so who cares? We live in interesting times when the question of failing banks is on the front page of GFY for 24 hours
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you know the biggest problem with all big banks is counterparty exposure, cause if Bearn Sterns would go into BK or any other bank with high derivate exposure, it could force a lot of other companies go into BK too.
Bearn Sterns alone has $13 trillion in counterparty risk.
LEH story from official source:
Lehman Brothers Obtains $2 Billion Bank Credit Line (Update2)
By Andrew Frye
March 14 (Bloomberg) -- Lehman Brothers Holdings Inc. obtained a $2 billion credit line as the investment bank tried to blunt the stock's worst drop in almost eight years and assure investors the firm isn't short on cash.
The unsecured, three-year facility from 40 banks replaces an existing credit line, New York-based Lehman said today in a statement. JPMorgan Chase & Co. and Citigroup Inc., also based in New York, led the effort, the firm said.
Lehman announced the financing hours after Bear Stearns Cos. said it agreed to an emergency bailout by JPMorgan Chase and the New York Federal Reserve. Bear Stearns, which fell 47 percent in New York trading, said its cash position had ``significantly deteriorated'' in the past 24 hours, raising concern among investors that more financial firms may face a liquidity shortage.
``Nothing speaks like cash in a crisis, and they have the cash,'' said James Ellman, president of San Francisco-based Seacliff Capital LLC, which has about $150 million under management. ``In these financial markets, locking in three-year money is long-term. Usually we call it medium-term, but now that's very long-term.''
Lehman fell $6.73, or 15 percent, to $39.26 at 4:15 p.m. in New York Stock Exchange composite trading, the most since April 2000, leaving the stock down 40 percent this year.
``We are extremely pleased with the success of the syndicated facility and view this as a strong signal from the market and our key bank relationships,'' said Paolo Tonucci, Lehman's global treasurer, in the statement.
To contact the reporter on this story: Andrew Frye in New York at
[email protected]
Last Updated: March 14, 2008 16:50 EDT
another interesting comment from somewhere else....
"You can safely assume that Bear is not alone here," said an interest rate strategist at one European investment bank in London, who declined to be identified.
"We have been setting prices in swaps markets in recent days that were designed to say 'no deal' and at least one other U.S. investment bank -- not Bear -- dealt. That is very worrying if they needed the cash that badly. We have been forced to review our counterparty limits ever since."
http://uk.reuters.com/article/newsOn...andCha nnel=0