Bear Stearns, Lehmann, Merril Lynch...

[Gumping]

Who next?

Caused an almighty gap on EUR/USD over the weekend which perturbed me a bit, but I don't involve myself with equities or indices at all! Some of you guys must be either a: shocked, or b: rubbing your hands together, or c: having a huuuuuuuuuge w@nk at the prospect of what you'll spend your earnings on

Seriously though.... the system must be very, very sick. I'm reading that some IB's have come together to set up a $70Bn fund that any one of them can tap into to solve liquidity crises. The Fed are playing hard with bailouts - probably because they know that if they bail out Lehmann, they will have to bail out plenty of other companies before this is over. And I reckon USA taxpayers will get a bit pi$$ed off at paying the severance bonuses of the CEO's of all these companies.

the other bit of news that makes me laugh about the Merril buyout is that about 3-4 years ago, the board sacked the CEO because he DIDN'T want to invest in sub-prime mortgages because they were risky. They put in someone who did. I bet they all feel silly now :!: The f@cked up thing is how much money these hooligans (that's what it amounts to!) will be taking home while investors, pension funds etc. pay the price in diminshed returns and outright losses.

 

[rags2riches]

the other bit of news that makes me laugh about the Merril buyout is that about 3-4 years ago, the board sacked the CEO because he DIDN'T want to invest in sub-prime mortgages because they were risky. They put in someone who did. I bet they all feel silly now :!:

That's hilarious - have you got a link to this?

 

[Gumping]

That's hilarious - have you got a link to this?

I can't find the article any more - I read it ages ago. It might not have been Merril since looking them up, it seems their CEO came in in 2002 and started investing in sub-prime quite a while after that. It may have been one of the other big banks in that case.
I should investigate before I rant....or maybe just publish in The Sun....

Can anyone help?

 

[BSD]

Gumps, I'd say that there must have been several CEO's who had the brains to see the fallacy and limited half-life of a busines model based on selling credits to people who couldn't afford them, but didn't want to lose their lucrative jobs, so bowed to the pressure and went ahead anyway.

I mean, greed may make you blind, but not necessarily brain dead, eh.

 

[Gumping]

Gumps, I'd say that there must have been several CEO's who had the brains to see the fallacy and limited half-life of a busines model based on selling credits to people who couldn't afford them, but didn't want to lose their lucrative jobs, so bowed to the pressure and went ahead anyway.

I mean, greed may make you blind, but not necessarily brain dead, eh.

Yer right I s'pose. I just distinctly remember reading an article about a board sacking a CEO because he thought sub-prime was too risky. I thought it was Merrill, but it could have been one of the other majors.
I could also have been intoxicated

 

[BSD]

I could also have been intoxicated

 

[Gumping]

Well it's a good excuse for shagging mingers....so why not try it elsewhere?

 

[BSD]

Well it's a good excuse for shagging mingers....so why not try it elsewhere?

Yummy Mummies, eg

 

[anley]

The CEOs had no real power, they were always puppets to the people that make the money.

For example, if you had a bond desk that was making you $250m-$500m a year it's very hard to tell them what they can and can't do. If you push it they just all walk out and move to another bank.

So even with a cystal ball (2 years ago) if one of these CEOs had said enough is enough, we're getting out of buying selling this junk, he would have been the one walking, they would have forced him out and it would have been large bonuses all around. Then of course the crap hits the fan, the full result of the greed is laid bare and everyone goes broke.

Short term is the name of the game, make those quarterly numbers, make them good and to hell with 1-2 years down the road.........

 

[BSD]

That makes one heck of a lot of sense Anley !

Doesn't say a lot about us humans though does it.

I mean, tomorrow is coming, it's just a question of time.

Being in denial about that, thinking that somehow I'll not care about that while I can eat my cake today, is not particularly reminiscent of real wisdom, is it !

 

[JTrader]

EURUSD down 300 pips today -wow!

But of course such moves are only useful to those traders, who have a good trading plan, that they execute. Hindsight is beautiful of course, but of no use whatsoever in the moment. Today has been my best day ever FWIW.

 

[Gumping]

EURUSD down 300 pips today -wow!

But of course such moves are only useful to those traders, who have a good trading plan, that they execute. Hindsight is beautiful of course, but of no use whatsoever in the moment. Today has been my best day ever FWIW.

Well I got 70 of 'em :clap: It'll do