Lehman To File for Bankruptcy Protection

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UPDATE IV: Sorry for the damn site going offline (I really wish I could curse right now). I have no idea what happened. My guess, Lehman Brothers got all pissed about my “fortune cookie curse” on them and ordered a web assault on iBC. Apparently, our fate is intertwined with Lehman.

Mini Update within a bigger Update: The site was hacked down by egregious iBankers. We are fighting them on the internets. Developing…

Odd, no?

Anyway, BAC just made a massive error, through buying MER. Essentially, the Fed is forcing them to do this deal. Everyone knows, they can get MER for $15 or less. Instead, they are trying to paint the pig gold and tell us it’s a golden bowling ball. It’s not. It’s a stupid pig with gold pain on it.

With that in mind, expect to see BAC at new lows, within weeks. And, on a big spike, I might short some MER, based upon the insane theory that BAC shareholders may say “hmmm, this deal blows, cancel it now.”

Basically, BAC is the biggest bagholder known to modern finance. I am sure Cramer will find the silver lining inside the nuclear bomb crater and suggest we go out and buy banks, again.

Then we have AIG. KKR and JC Flowers just walked away from a tentative deal with them. Basically, they need to raise $40 billion, in order to avoid a credit downgrade. Because of this, they want the Fed to give them a bridge loan of $40 billion: ROFL.

Are they nuts?

Finally, the hapless banks are concocting some new liquidity pool, in order to create liquidity. Shocker. Ignore their efforts and buy SRS, SKF and short LM, with great vigor.

The market should get stomped out tomorrow, led by free falling banks and massive drop in the dollar.

UPDATE III: Merrill’s board is voting on a $29 per share offer (all stock) from BofA. If this dilutive deal goes through, expect the shares of BAC to get mudstomped. This is a highly irresponsible move, on behalf of BofA. I am sure their shareholders would appreciate it if they could wait until Tuesday to negotiate a buy out price. My guess, they could bag MER for $10 or less, if they keep their cool.

UPDATE II: In light of the probable unwinding that will occur, here is a short list of Lehman Brothers’ top holdings:

General Electric Company [[GE]]

Pfizer Inc. [[PFE]]

Target Corporation [[TGT]]

UBS AG (USA) [[UBS]]

Linn Energy, LLC [[LINE]]

GLG Partners, Inc. [[GLG]]

Merck & Co., Inc. [[MRK]]

Microsoft Corporation [[MSFT]]

[[CME]]

Bank of America Corporation [[BAC]]

Apple Inc. [[AAPL]]

Flagstone Reinsurance Holdings Limited [[FSR]]

WellPoint, Inc. [[WLP]]

Wal-Mart Stores, Inc. [[WMT]]

Exxon Mobil Corporation [[XOM]]

UnitedHealth Group Inc. [[UNH]]

Google Inc. [[GOOG]]

Johnson & Johnson [[JNJ]]

Baidu.com, Inc. (ADR) [[BIDU]]

UPDATE: Should AIG catch a credit downgrade, they will face a 46 billion dollar cash call: ROFL. That’s like Dr. Evil type money. God help us.

S&P futures indicate a 36 point drop (3%), thus far. CDS spreads have widened by 30 basis points.

NOTE: As soon as I can start cursing again, Dick Bove is getting a “lifetime achievement” As*hat Award.

Developing…

160 Responses to “Lehman To File for Bankruptcy Protection”

  1. BREAKING NEWS- Siv Patel who owns a convenience store down the road from me has put a bid in to buy LEH for .03/share plus it’s corporate building ONLY if the Fed agrees to backstop any losses and agrees to finance the building purchase. He tells me the Bernanke will be holding a conference call on this matter shortly.

  2. 0.03/share for preferred also? LEH, i think you should take the deal.

  3. http://online.barrons.com/article/SB122126846691831075.html?mod=9_0031_b_this_weeks_magazine_main

    This writer needs a Raise “Lehman’s fate may soon be sealed, but any buyout bid could be very low.”

  4. Fuckers – I still have about 5 hours to pull out the bazooka.

    Wait a minute, I used up the bazooka-power last weekend. Oh Shit!!!

  5. wondering why the skf was laying dormant last few weeks, now it appears like Vesuvius, it was accumulating hot magma

  6. WAFFLE HOUSE WAITRESS

    I’ve been saving tips in the folds of my “Tennessee Pride,” and am prepared to make all all-cash, scattered-smothered-covered offer for LEH. If you do not accept my offer I will beat your ass:

  7. The banks blinked.

    http://biz.yahoo.com/ap/080914/lehman_brothers.html

    Banks seen offering plan to restore confidence
    Sunday September 14, 6:32 pm ET
    By Joe Bel Bruno and Marty Crutsinger, AP Business Writer
    Lehman’s future in doubt, banks seen unveiling plan to restore confidence in financial system

    NEW YORK (AP) — As the outlook for Lehman Brothers’ future appeared to dim Sunday, U.S. and foreign banks joined forces to create a plan aimed at inoculating the global financial system against the investment bank’s possible failure, a top investment banking official said.

    Banks are in tense talks to create a pool of money worth up to $50 billion to lend troubled financial companies, the official said on condition of anonymity because the discussions were ongoing. And officials at the U.S. Treasury and the Federal Reserve are expected to say they are prepared to be more generous in the Fed’s emergency lending program for commercial and investment banks .

    The plan comes as top government officials and Wall Street executives hold marathon meetings to save Lehman Brothers. The meetings have failed to find a buyer for the troubled 158-year-old investment bank, raising worries that its likely collapse would disrupt global financial markets.

    The official also said the U.S. Treasury Department and the Federal Reserve are pushing Bank of America Corp. to buy Merrill Lynch & Co., though talks are still preliminary.

    Expectations that Lehman would survive as a company dimmed Sunday afternoon after Barclays PLC withdrew its bid to buy the investment bank.

    Barclays’ and Bank of America Corp. were considered front-runners to buy Lehman.

    THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

  8. I am Siv Patel and my bid was a lot higher than 0.03 c per share. It was 0.032 c. Please correct the story immediately. I have a customer to ring up, I gotta go.

  9. WMT and TGT, ah I like that.

    There’s no reason the futures should have bounced there, these 300 point stop losses are a bit obvious.

  10. Wow. Things could still change between now and midnight though.

    Thanks for the list Fly.

    Adding, Dow futures down 284?! Fly will be able to curse in no time.

  11. Cursing should start tomorrow. Cant wait. Best part of the site.

  12. LET THE CURSING BEGIN!!!!

  13. Fly,

    All those positions will be forcibly liquidated ASAP? Or do they have some time to “work them?”

    What’s your best bet for what happens tomorrow?

    -DT

  14. Normally, I’d say someone would buy their holdings. However, in this tape, they may need to unwind quickly.

    In addition to Lehman’s 400 billion stock portfolio, they have 550 billion in debt.

    Fun, no?

  15. So you mean they’ll be unwinding on the open market? That could be lots of fun.

    The dollar is tanking a bit. That should help the commodity names, no? As far as cursing goes, does the Dow have to close below 11k? or just trade below it intraday?

    Finally, Where will the Dow close tomorrow?

    -DT

  16. Lehman has 550 billion in debt? is that right fly?

  17. My vote is if the Dow hits 11,000 or less intraday, Fly should be free to begin cursing.

    Adding, anybody smell an emergency rate cut in the air this week?

  18. China, japan on hols.

    Australian market opens in less than 1/2 hour. Let’s watch.

  19. Now we are hearing about a $50 billion dollar bailout fund set up by the world bank tonight to help ease credit issues by the Lehman failure that is expected shortly…..hence why we see a bounce in the futures and a fall in the Yen futures…..who is bluffing and who will actually break from the game to save their own ass….now that will be key to the market tommorow…..and will determine if we crash or hold up….IMO

  20. Fuck the cursing.

  21. Where are you guys watching the overseas market?

  22. Lets not forget where futes were on the night of BSC for $2. They never traded that low again. We’ll see where we are in the morning, but I sure wouldn’t want to be net long. Lets just get End Times over with already so we can get on to Beginning Times. But the fuckers in charge of the end of the world keep putting it off for another day, like they can exscape inevitable death.

    I bet Warren Buffett has been called.

    Breaking NEWS : War in Iraq has been cancelled! All personel, you are GOING HOME!. Money previously earmarked for death, destruction, the spread of ‘freedom’ and nation building will be diverted to plug the worlds financial leaks, much to Dick Cheney’s chagrin.

  23. Nihilist Investor

    BAC is about to make its second profoundly stupid purchase. Buying MER at $23 has to be even dumber than buying Countrywide in the first place. MER equity would have been virtually free by Friday. What kind of grotesque, twisted illegal payback scheme is BAC management receiving to do this transaction which so insane on the surface?

  24. Bloomberg just showed a clip of Dick Bove giving an explanation of bankruptcy and marking down Lehman’s assets. Why do they even give that huckster air time?

    Nihilist, I was thinking the same thing about BAC this afternoon.

  25. Fly,

    What’s the play here? Yes, I am just an Internet leach but I need money too.

    Please throw us all a bone!!!!

  26. INDEX VALUE CHANGE OPEN HIGH LOW TIME DJIA INDEX
    11,252.00 -199.00 11,312.00 11,312.00 11,131.00 19:17

    from http://bloomberg.com/markets/stocks/futures.html

  27. they are on the front page of cme.com as well

  28. And the refiners?

  29. F-ing Loser- The play is (was) short the futures at the close this past Friday and then cover about 6:15 PM today.

  30. New ticker? Never seen this before. Maybe for the “bad bank” workout?

    LEHMAN BROS HLDGS (LHBI.PK)

    http://finance.yahoo.com/q?s=lhbi.pk

  31. He has already violated the rules about 5 posts ago …

    He used the word “Fargin'”, which in my books and in the books of many an Irishman would be a swear word.

    Even an Irishman would admit Fargin’ is swearing.

  32. I think the .PK means it trades on the OTC “pink sheets”, so it means that they’re getting the ticker symbol ready for the bankrupt entity which won’t have sufficient capital to be listed on one of the major exchanges… my layperson’s understanding anyway.

  33. TraderCaddy,

    Since I am a F-ing loser and have balls the size of Tic Tacs, I missed that one.

    I need a new play that I can’t F-up.

    Thanks in advance….

  34. Farg that, Shortbus, it’s not swearing ibc style.

  35. good news…..asia closed for holidays tonight and tommorow….so the real fireworks will be at 2am….Europe….

  36. Handles: based on your statement, The fed has another whole day to get this LEH deal done. As the Germans apparently warned/threatened the US that they should get the LEH deal done before the Asian markets open.

    No deal to be done till the Asian market open, great.

  37. The play would be to ease into GS or MS on any gap down at the open. They can’t remain as independents if MER goes with BAC. If they don’t gap down (it’s possible) step aside, turn off the computer, and enjoy the day.
    Raymond James and some of the regionals may be good plays on the long side.
    Gotta wait to make sure they get trashed real good at the open.

  38. CNBC is airing right now… Bill Gross, Harvey Pitt, all the regulars.

    -DT

  39. Bill Gross is a cunt.

  40. Hey everybody… Why so serious? …..Why so serious?

  41. F-ing loser,

    IMHO, if you’re not already positioned, you will have a hard time making any right moves, at least before 10:30 a.m.

    The best advice is probably to wait until Monday afternoon to see how things shake out.

  42. Fly,
    Any idea of their commodity positions? In particular energy related liquidation–Short or long?

  43. Are asian mrkts closed? I found this list of market holidays, not sure of accuracy:

    SATURDAY, SEPT 13

    SOUTH KOREA – Chuseok, Full Moon Festival – Market Holiday

    SUNDAY, SEPT 14

    SOUTH KOREA – Chuseok, Full Moon Festival – Market Holiday

    TAIWAN – Mid-Autumn Moon Festival – Market Holiday (No addition day off for it’s falling on weekend)

    MONDAY, SEPT 15

    CHINA – Mid-Autumn Festival – Market Holiday

    HONG KONG – The day following Chinese Mid-Autumn Festival – Market Holiday

    JAPAN – Respect for the Aged Day – Market Holiday

    SOUTH KOREA – Chuseok, Full Moon Festival – Market Holiday

  44. TC – I disagree.

    We were overbought going into today. Regardless of this news, we would would have sold off 20 pts on the S&P anyway.

    I think the gap lower will squeeze higher, and sell off worse into the close.

  45. Fucking loser, if you don’t know what to do, and aren’t already positioned, do nothing.

    Why pay commission to guess and probaby lose money?

    I can tell you with some certainty that if do something without having an idea or an edge you’re gonna lose money.

  46. lol @ 50 billion bank consortium…

    From where do you think that 50 billion was borrowed?

  47. Guys, it’s cool. Jim Cramer says that Lehman doesn’t matter. He said that as long as AIG gets the $40 billion in needs (LOL) that he’s a “buyer not a seller.”

    Whew! Confidence restored!

    -DT

  48. Nihilist Investor

    It is also somewhat insane that this news is such a “shock” to the market. Or, to phrase it more precisely, the market apparently was pricing in a very high percentage chance that the government would bail out LEH. This is a very sad fact and utterly nauseating it its own right. I guess this is one of the rare situations where the insiders privy to the roundtable discussions with the Fed, lawyers, and CEOs misjudged their own information leaks. I feel like I want to vomit for our country whatever happens.

  49. And for my most important comment – think Buffet.

    Day-to-day is noise, the fundamentals are what matter in reality, over time.

    Even if we end the day higher (not calling for that) it doesn’t change the reality of the situation. A BoA for MER is a bad thing, LEH failing is a bad thing, and neither one alleviates the problems the financial system faces.

    Same goes for a special 50b package from God-knows-who.

  50. I stabbed a knife into my laptop screen when I heard Cramer say buy AMGN tomorrow.

    I assume many of you did the same.

    …You know what that means — increased consumer spending! Buy AAPL!!

    lol.

  51. BofA must be expecting major share price erosion in their own equity for them to be bidding $29 for MER based on of BofA’s Friday close. It makes no sense anyway, let alone at $29/share.

  52. TraderCaddy,

    I understand easing into GS (Goldman) but I am not sure why you want to ease into MS (Microsoft). Please explain.

    WoodShedder,

    Thanks for the advice; I will probably wait until the afternoon unless the fly has a good play for the morning.

    Thanks Again!!

  53. F-ing Loser….you have to be at least 18 years old to play with a Scott Trade account.

  54. Wall St crisis fucking up my “Entourage” season premiere.

    http://www.hbo.com/entourage/

  55. The Fed is going to cut a full basis point in the morning.

    Youre welcome.

  56. Attention US banks: If you get a check from the $50B bank consortium that has “US Treasury” printed at the top, then scratched out and the words “Bank Consurtshum” scrawled underneath in crayon, please disregard this, uh, printing error. No taxpayer money involved. No sir. These banks are propping each other up out of the goodness of their hearts.

  57. That was last week Ari. Fucking-A, lay off the blow.

    wow, and there’s the BOA deal

  58. “Hah”. I made a great deal.

  59. John Thain, I think you meant

    ZING!

    Meatballs is saying it’s an all stock deal.

  60. BAC buys MER for $29 a share.

    There’s not going to be any brokers left to short tomorrow!

    DAMNIT!

    -DT

  61. BAC = Jesuits, they want it, just like they did Countrywide. Receivership.

    Feudal system restored.

  62. Gee, I bought MER for BAC stock. John Thain is a tough negotiator. Not even $2.00/sh cash.

  63. The Fly is God.
    SKF may open over 135 or something insane like that.

  64. There’s got to be a fascinating back story to explain why BAC bought MER tonight.

  65. Great fucking server, Fly. Seriously, how difficult is it to get a fucking server than can host traffic?

  66. Hey quit bitchin about the server… Ther’re back up. Don’t ya know that the PPT is trying to take the Fly off the internets?

  67. Actually Siv, I Jewbag McPhee have decided to offer EU .03/share. So lick my jewballs.

  68. Sitemeter stats: 700 people or so when site got fucked. The cursing should start tonight and the IT folks should be fired like LEH staff for this.

  69. Would it be that fucking difficult to get a server that could handle your traffic? Quit dicking around with your little PPT program. Call a fucking hosting company, pay $100 a month, and tell your gravy slinging “IT guy” to jump in a bag of dicks.

  70. We have determined the that “1bankcoins.com” site is the “epicenter” of the short seller universe. Therefore, we have instructed teenage Romanian hackers to “knock that shit off the cybergrid”, to protect the American economy from evil short sellers and… oh shit, YM just ticked below 11100. Fly may curse TONIGHT!

  71. Shut up you little turd. We own our own server. The IT guy is away and now back. We’ll be up in no time.

    Relax. I am not Lehman or some guy you can bully around. I’ll have your arms punch off for you.

  72. the PPT became self aware and shortly thereafter decided humanity is too retarded for any sort of banking, currency, trade, or even barter system. it is dismantling the world’s financial giants as we speak.

  73. We in the KNOW, should have no pity for any fucker who was long financial stock/s over the weekend. They knew the market risk, and tomorrow (barring a miracle), they will face the music.

    And, what will happen to all the shorts holding positions in Merrill tomorrow … I think I know, and it will very likely lead to more forced liquidation of assets.

  74. SQL injection attack, or what? Fuckers.

    Give ‘em hell you meatball loving IT guy.

  75. He’s kinda right, Fly, you ought be able to afford the 100 bucks a month to get a better hosting server.

  76. My guess, it was punyandy who hacked the site.

  77. Thanks guys, I will just sit on the side lines tomorrow.

    One last question. What do you think the BAC/MER deal will do to BAC Stock? I backed up the truck about a year ago and have been averaging down ever since.

    If BAC pops on the news should I unload?

    Thanks again and good luck to everyone!!

  78. Fly- where did you get the LEH top holding info?

  79. Expect BAC to open down 5. They WAY overpaid for MER. The arbs will be all over BAC. And, since it’s an all stock deal, the sellers will lean on MER too.

  80. My little magic 8 ball told me Lehman’s holdings.

    Go check them out. They are all accurate.

  81. CNBC reporting JPM buying WM?

  82. Watching CNBC Europe and the chick just said “CNBC has learned JP Morgan Chase is interested in buying a piece of Washington Mutual.” Did I hear that right?

  83. Fly,

    Thanks for the quick reply. I guess BAC is now a core holding for me. Oh well, at least my MBI holdings have been doing pretty good lately.

    Thanks again!!

  84. If JPM buys WM, the Dow will drop 600+ tomorrow.

    That would crush another Dow component.

    Short sellers can only pray this happens.

  85. F- loser:

    In order to hedge your BAC long, might I suggest selling short MER at the open or going long SKF?

  86. F-ing Loser,

    “I understand easing into GS (Goldman) but I am not sure why you want to ease into MS (Microsoft). Please explain.”

    MS=Morgan Stanley

    Does this help?

  87. wow. crazy weekend. glad i bought the SKF at the close on friday. of course now watch everyone go out and buy bank stocks tomorrow, just to be ‘contrarian’.

  88. Oops, yea, Morgan Stanley makes more sense.

    I might go ahead and buy a little SKF. Being positioned a little more neutral would be nice during all the volatility.

    Thanks guys.

  89. BAC’s buy price was just a way for BAC to let the world know: when you trade with BAC, the Fed is your counter party.

  90. Where is the board of directors for BAC? Probably at the afterparty on location at the NY Fed vault with DJ Paulson and Bling Ben, doing lines of blow with $100 dollar bills. Wait a minute ….. this kind of shit explains why all of our currency has coke residue on it.

  91. Fed accepting equities…..BAC will turn around and sell MER to the Fed…..a big cash infusion for BAC ??

  92. Fly, what are your thoughts on energy/commodities with the dollar falling on this news? Will the dollar/commodity trade resume or has it disconnected?

  93. Never mind Fly …. Futures have both gold and copper up with dollar down …. oil may want to test support here before moving up again but a rate cut could change that.

  94. I think this put in nail in the bottom, messy open and maybe some fun days ahead but I AM CERTAIN THIS XLF PLEX HAS SEEN THE BOTTOM…

  95. Might be wiser to buy UYG on close. Too late to buy SKF now. Another rate cut wouldn’t surprise me a bit. The Three Stooges (Bernanke, Paulson, & Cox) seem to have a hard-on for shorts in general and iBankCoin in particular. Such is life in the Union of Soviet Socialist American States.

    Das Vidanya, Comrades.

  96. Good morning to all. Go long lead and gunpowder. Keep your head down, if you want to keep it, the spaghetti is poised to hit the fan. It will be messy. The suicide rate among investment bankers is gonna spike big time.

  97. Meanwhile, crude below $100.

    -DT

  98. Send lawyers, guns, and money. The shit has hit the fan.

  99. I can hardly wait to hear Kudlow & Luskin’s spin on these End Times for Wall St. We can only hope these are End Times for apparatchnik talking heads.

    Pay attention to those who called this all along like The Fly, The Jake, The Fleck, Marc Faber, Nouriel Roubini,….

    Nouriel Roubini

    “This is indeed the most severe financial crisis since the Great Depression and occurring at a time when the US is falling in a now severe consumer led recession. The vicious interaction between a systemic financial and banking crisis and a severe economic contraction will get much worse before there is any bottom to it. We are only in the third inning of a nine innings economic and financial crisis. And the only light at the end of the tunnel is the one of the incoming train wreck.”

  100. Are you ready, Skee Daddy?

  101. Mea Culpa –

    “This result is far different than what I had envisioned for the company. It was my view three weeks ago, that the company must merge; that management would resist a takeover; and that the merger would be hostile.

    It was further my belief that the company’s assets were not in devastatingly bad condition. That if given time they could be worked out without a major negative impact on shareholders. Moreover, it appeared that the company had generated $3.5 billion in revenue and $0.6 billion in pretax profit excluding the write downs of questioned assets in its third fiscal quarter (ended August 31). Consequently, I moved the rating on the stock up to a Buy.

    This view was clearly incorrect. After extensive negotiation with other financial companies and the effected government divisions, no buyer was found and the government chose not to intervene to assist the company. Thus, we are stepping into uncharted territory.”

  102. Cool. EEV’s up 7.24% on the first trade pre-market.

    Where’s that bald-head Lenin clone? Shouldn’t he be on Pom Pom TV, telling us all to buy banks? Booyah indeed.

  103. Hey guys, no joke here…need help

    I was one of the lucky ones to have bought Merrill Lynch at the close on Friday. It was a substantial amount to me, and I was wondering how should I play this out.

    As of now Merrill @ $23.11. Isn’t the share prices suppose to be at $29?

    Many thanks,
    HC

  104. Reggie is doing a great job covering this mess

    http://boombustblog.com/

  105. Morning Juice :P

    Last time Kudlow “sort of” admitted defeat, it marked a short term bottom.

    Everyone is talking these investment banks, how is it that the monolines are still around?

  106. HC – sell. The reason you are not at 29 is the risk the deal does not get done. If you are lucky enough to scalp 37%, take it. If the deal does not get done MER goes to $0. Sell it three ways from Sunday. Sell it. Sell it now. Do not wait for more news. Sell it. Take it. Book it. Buy a nice watch.

  107. anyone else thinking about selling SKF at the open? up 15% in pre market, i’m thinkin about taking profits before the Plunge Protection Co. Steps in.

    Fly are you a buyer or a seller here?

  108. HC

    think. Use your brain. It’s a share swap, right? So read the provision. BofA will offer x BofA for merril stock. It’s ratio which means you still have market risk. If you don’t know that shit, you’re too stupid to trade, so you ought to stay away from it and treat like a lucky break.

  109. I am just asking because Merril was heavily shorted as of Friday, therefore wouldn’t there be a huge short squeeze?

    Thanks for your help Boomer.

    “J”…what the fuck is your problem? I am just asking a question.

  110. HC – I agree with the others, you caught a good trade don’t get greedy, get out of it now. Same with me and SKF, the government -will not- let this market crash like it should have ~3 times this year already. I’m gonna put in sell orders around $130 and get the fuck out.

  111. Yo, the refiners??

    WNR way down in pre-market>>>

  112. SKF has hit 126. When do you want to sell?

  113. Anyone think we can rally outta the hole for 2 – 3 days? I think thats possible. I’m thinking this move lower in oil/gold is more likely a forced unwinding that will rewind & can be bought.

  114. 126…..pffffft

    Chump Change divided by 3.

  115. XLF’s at $19.76. It’s been holding at $19.75…

  116. With oil getting pounded again, are the refiners finally seeing the light of day? They are trading down premarket but oil seems like it wants to go to $80.

  117. I can’t take it anymore :) That idiot Pisani was just babbling about a mid-day rally.

  118. According to a report on The Insurance Insider, Warren Buffett is now in rescue talks with American International (AIG)

  119. Juice, there will be some kind of idiot parade rally after the initial wreckage. Nothing more than more trading opportunity. This thing is going to get ugly. Clubbing baby seal ugly.

  120. anyone think it’s takeoff time for SRS? commercial real estate hasn’t been hit yet!

  121. Crack Spread update: $15.26

    Looks like my calculations are correct, as all stocks such as VLO, TSO, WNR, ALJ, etc … are all probably going to open at least 10% lower, just as the crack spread is at least 10% lower from over $18.

  122. CNBC talking heads will be spinning like a top today, in their minds, they will be trying to avert a panic in the market.

  123. Cashin thinks there might be a capitulation today. He’s one of the few who knows what’s he’s talking about.

  124. Palin – comm re is gonna need earmarks, massive earmarks. see what u can do

  125. wow. i don’t think i’ve ever seen the dow futures this low.

    oil is a wild card. could be a moderating factor in the market decline.

  126. Breaking News from MarketWatch a division of Wall Street Journal. Must be a SLOW news day for them :-)

    9:27 AM today
    New – NYSE Trader: ‘We’ll get through it’ – MarketWatch

  127. So why is SKF only at 126??? I want it to be higher!

  128. Hmmm , GREAT … just GREAT … this is just waht i need from my broker RIGHT NOW !!!!

    Service Temporarily Unavailable

    The server is temporarily unable to service your request due to maintenance downtime or capacity problems. Please try again later.

  129. You sure were right about spin, Boca. I knew they’d bring that fool Cramer out.

  130. Why did the DOW open only -90?? That’s my bazooka fuckers.

  131. PPT in full effect this AM. What kind of heebery is this?

  132. hahah wtf they came out of the gate BUYING banks. i fucking knew they’d pull some bullshit like this.

  133. Gee, I don’t know. Perhaps it’s because the Soviet Central Bank now accepts equities as collateral? They’re not about to take a loss on them.

  134. Just short sellers taking profits. It’ll drop like a brick soon enough.

  135. recusancy: brick dropped

  136. Oh man I really just want to buy some GS down here

  137. GS is the cream of the crop and thats being proven now – Its a damaged stock not a damaged company.

    When the dust settles only MS and GS will remain

  138. Let the market come off the lows & rally to wednesday … then get short HUGE because UGLY will be the rest of sept into october.

    This is a requisite technical rally. Let it happen.

    We are NOT finished going down.

  139. Took about 10 minutes but I bought and sold my usual SMH for about a 2% gain. I am now taping my fingers to the back of the chair and will just watch for now.
    Noting Trin is below 60 which is a buy. I would like to see the VIX get into at least the mid-30s though.

  140. Does anyone know if all of the DJ 30 stocks opened in the first 5 minutes of trading? If not who was late?

  141. OK, FUCK IT … now this is NOT funny . time to change brokers.

    —————

    Error

    An error has occurred on our Web site.

    We’re sorry, the web page you requested is temporarily unavailable. Click here return to your home page.

  142. Dick Bove Says Banking Is Sound – Time to Buy Financials?
    by: Todd Kenyon posted on: March 10, 2008

  143. Todd Harrison

    09:36:55 AM

    position in uso

    Gate Sniffage

    * I just heard someone on TV say “the good news is that oil is down $5.” That’s NOT good news through the lens of deflation as it’s endemic of slowing global growth. I will, so it’s said, nibble on some USO (small) with an ear towards a rate cut and an eye towards a bounce.

    * I’ll be scanning my screens for green beans this morning but it–and everything–is purely a trade. First blush, I’ll note that Amazon (AMZN) is only down $1.70. That, to me, hints at some underlying demand.

    * We’ve spoken about The State of the Art in the financial industry for some time. With three of the five top-tier brokers–Bear Stearns, Lehman (LEH) Merrill (MER)–disappearing this year, it’s safe to say that the future is now. It’s not something one would wish for–and our hearts to out to our fallen friends–but I’ll again offer that it was necessary medicine on the road to recovery.

    * Those of us who traded the Asian Contagion, LTCM, the dot.com implosion and the aftermath of 9/11 will tell you that price discovery is a process rather than a point. It’s entirely alright to be opportunistic but it’s more important to remain disciplined. These are unchartered waters and risk management should trump reward chasing.

    R.P.

    ———————————-

    MV Respect

    09:30:08 AM

    No positions in stocks mentioned.

    Minyan Jeff Saut’s Call For This Week
    Warren Buffett is fond of saying, “You only find out who’s swimming naked when the tide goes out;” and evidentially the biggest “nudie” is Merrill Lynch (MER) since the Illuminati decided to save it and let Lehman (LEH) “go.”

    Clearly, Czar Paulson does not think the government should be in the business of assuming credit derivative risks (CDS’s, etc.), which is the real story going forward. Plainly, dealing with the derivative, and counterparty, risks will be the next piece of the puzzle as things continue to get curiouser and curiouser. The ideal daily pattern for today would be for a hard down opening followed by a rally attempt, which fails, leading to an afternoon downside “washout” and then firming into the close.

    Any closing strength should be viewed as a positive since that would likely indicate a skein of positive closes. While more conservative types should probably wait for the aforementioned pattern, more aggressive participants should buy the hard down opening on the belief that Paulson and Bernanke are cognizant of markets and will not want to see their “trifecta” come unraveled. Consequently, the Fed will be pumping money, short-sellers will be monitored, corporations will be urged to institute share buybacks, and mutual funds will be forced to buy. Being value buyers, the institutions will likely buy the drugs and food stocks first and then technology. As for my firm, we will be using ETFs.

  144. shortbus: i tried to sell my SKF at the open, and my fucking order kept giving me invalid session bullshit. cost me a few pts before i could get it resolved. that’s some first class bullshit, not unlike what you’re dealing with.

    juice: i like your idea.

  145. […] The Fly discusses the faults with the Bank of America and Merrill deal. […]

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Comments are closed.
Previous Posts by The Fly

Lehman To File for Bankruptcy Protection

414 views

UPDATE IV: Sorry for the damn site going offline (I really wish I could curse right now). I have no idea what happened. My guess, Lehman Brothers got all pissed about my “fortune cookie curse” on them and ordered a web assault on iBC. Apparently, our fate is intertwined with Lehman.

Mini Update within a bigger Update: The site was hacked down by egregious iBankers. We are fighting them on the internets. Developing…

Odd, no?

Anyway, BAC just made a massive error, through buying MER. Essentially, the Fed is forcing them to do this deal. Everyone knows, they can get MER for $15 or less. Instead, they are trying to paint the pig gold and tell us it’s a golden bowling ball. It’s not. It’s a stupid pig with gold pain on it.

With that in mind, expect to see BAC at new lows, within weeks. And, on a big spike, I might short some MER, based upon the insane theory that BAC shareholders may say “hmmm, this deal blows, cancel it now.”

Basically, BAC is the biggest bagholder known to modern finance. I am sure Cramer will find the silver lining inside the nuclear bomb crater and suggest we go out and buy banks, again.

Then we have AIG. KKR and JC Flowers just walked away from a tentative deal with them. Basically, they need to raise $40 billion, in order to avoid a credit downgrade. Because of this, they want the Fed to give them a bridge loan of $40 billion: ROFL.

Are they nuts?

Finally, the hapless banks are concocting some new liquidity pool, in order to create liquidity. Shocker. Ignore their efforts and buy SRS, SKF and short LM, with great vigor.

The market should get stomped out tomorrow, led by free falling banks and massive drop in the dollar.

UPDATE III: Merrill’s board is voting on a $29 per share offer (all stock) from BofA. If this dilutive deal goes through, expect the shares of BAC to get mudstomped. This is a highly irresponsible move, on behalf of BofA. I am sure their shareholders would appreciate it if they could wait until Tuesday to negotiate a buy out price. My guess, they could bag MER for $10 or less, if they keep their cool.

UPDATE II: In light of the probable unwinding that will occur, here is a short list of Lehman Brothers’ top holdings:

General Electric Company [[GE]]

Pfizer Inc. [[PFE]]

Target Corporation [[TGT]]

UBS AG (USA) [[UBS]]

Linn Energy, LLC [[LINE]]

GLG Partners, Inc. [[GLG]]

Merck & Co., Inc. [[MRK]]

Microsoft Corporation [[MSFT]]

[[CME]]

Bank of America Corporation [[BAC]]

Apple Inc. [[AAPL]]

Flagstone Reinsurance Holdings Limited [[FSR]]

WellPoint, Inc. [[WLP]]

Wal-Mart Stores, Inc. [[WMT]]

Exxon Mobil Corporation [[XOM]]

UnitedHealth Group Inc. [[UNH]]

Google Inc. [[GOOG]]

Johnson & Johnson [[JNJ]]

Baidu.com, Inc. (ADR) [[BIDU]]

UPDATE: Should AIG catch a credit downgrade, they will face a 46 billion dollar cash call: ROFL. That’s like Dr. Evil type money. God help us.

S&P futures indicate a 36 point drop (3%), thus far. CDS spreads have widened by 30 basis points.

NOTE: As soon as I can start cursing again, Dick Bove is getting a “lifetime achievement” As*hat Award.

Developing…

160 Responses to “Lehman To File for Bankruptcy Protection”

  1. BREAKING NEWS- Siv Patel who owns a convenience store down the road from me has put a bid in to buy LEH for .03/share plus it’s corporate building ONLY if the Fed agrees to backstop any losses and agrees to finance the building purchase. He tells me the Bernanke will be holding a conference call on this matter shortly.

  2. 0.03/share for preferred also? LEH, i think you should take the deal.

  3. http://online.barrons.com/article/SB122126846691831075.html?mod=9_0031_b_this_weeks_magazine_main

    This writer needs a Raise “Lehman’s fate may soon be sealed, but any buyout bid could be very low.”

  4. Fuckers – I still have about 5 hours to pull out the bazooka.

    Wait a minute, I used up the bazooka-power last weekend. Oh Shit!!!

  5. wondering why the skf was laying dormant last few weeks, now it appears like Vesuvius, it was accumulating hot magma

  6. WAFFLE HOUSE WAITRESS

    I’ve been saving tips in the folds of my “Tennessee Pride,” and am prepared to make all all-cash, scattered-smothered-covered offer for LEH. If you do not accept my offer I will beat your ass:

  7. The banks blinked.

    http://biz.yahoo.com/ap/080914/lehman_brothers.html

    Banks seen offering plan to restore confidence
    Sunday September 14, 6:32 pm ET
    By Joe Bel Bruno and Marty Crutsinger, AP Business Writer
    Lehman’s future in doubt, banks seen unveiling plan to restore confidence in financial system

    NEW YORK (AP) — As the outlook for Lehman Brothers’ future appeared to dim Sunday, U.S. and foreign banks joined forces to create a plan aimed at inoculating the global financial system against the investment bank’s possible failure, a top investment banking official said.

    Banks are in tense talks to create a pool of money worth up to $50 billion to lend troubled financial companies, the official said on condition of anonymity because the discussions were ongoing. And officials at the U.S. Treasury and the Federal Reserve are expected to say they are prepared to be more generous in the Fed’s emergency lending program for commercial and investment banks .

    The plan comes as top government officials and Wall Street executives hold marathon meetings to save Lehman Brothers. The meetings have failed to find a buyer for the troubled 158-year-old investment bank, raising worries that its likely collapse would disrupt global financial markets.

    The official also said the U.S. Treasury Department and the Federal Reserve are pushing Bank of America Corp. to buy Merrill Lynch & Co., though talks are still preliminary.

    Expectations that Lehman would survive as a company dimmed Sunday afternoon after Barclays PLC withdrew its bid to buy the investment bank.

    Barclays’ and Bank of America Corp. were considered front-runners to buy Lehman.

    THIS IS A BREAKING NEWS UPDATE. Check back soon for further information. AP’s earlier story is below.

  8. I am Siv Patel and my bid was a lot higher than 0.03 c per share. It was 0.032 c. Please correct the story immediately. I have a customer to ring up, I gotta go.

  9. WMT and TGT, ah I like that.

    There’s no reason the futures should have bounced there, these 300 point stop losses are a bit obvious.

  10. Wow. Things could still change between now and midnight though.

    Thanks for the list Fly.

    Adding, Dow futures down 284?! Fly will be able to curse in no time.

  11. Cursing should start tomorrow. Cant wait. Best part of the site.

  12. LET THE CURSING BEGIN!!!!

  13. Fly,

    All those positions will be forcibly liquidated ASAP? Or do they have some time to “work them?”

    What’s your best bet for what happens tomorrow?

    -DT

  14. Normally, I’d say someone would buy their holdings. However, in this tape, they may need to unwind quickly.

    In addition to Lehman’s 400 billion stock portfolio, they have 550 billion in debt.

    Fun, no?

  15. So you mean they’ll be unwinding on the open market? That could be lots of fun.

    The dollar is tanking a bit. That should help the commodity names, no? As far as cursing goes, does the Dow have to close below 11k? or just trade below it intraday?

    Finally, Where will the Dow close tomorrow?

    -DT

  16. Lehman has 550 billion in debt? is that right fly?

  17. My vote is if the Dow hits 11,000 or less intraday, Fly should be free to begin cursing.

    Adding, anybody smell an emergency rate cut in the air this week?

  18. China, japan on hols.

    Australian market opens in less than 1/2 hour. Let’s watch.

  19. Now we are hearing about a $50 billion dollar bailout fund set up by the world bank tonight to help ease credit issues by the Lehman failure that is expected shortly…..hence why we see a bounce in the futures and a fall in the Yen futures…..who is bluffing and who will actually break from the game to save their own ass….now that will be key to the market tommorow…..and will determine if we crash or hold up….IMO

  20. Fuck the cursing.

  21. Where are you guys watching the overseas market?

  22. Lets not forget where futes were on the night of BSC for $2. They never traded that low again. We’ll see where we are in the morning, but I sure wouldn’t want to be net long. Lets just get End Times over with already so we can get on to Beginning Times. But the fuckers in charge of the end of the world keep putting it off for another day, like they can exscape inevitable death.

    I bet Warren Buffett has been called.

    Breaking NEWS : War in Iraq has been cancelled! All personel, you are GOING HOME!. Money previously earmarked for death, destruction, the spread of ‘freedom’ and nation building will be diverted to plug the worlds financial leaks, much to Dick Cheney’s chagrin.

  23. Nihilist Investor

    BAC is about to make its second profoundly stupid purchase. Buying MER at $23 has to be even dumber than buying Countrywide in the first place. MER equity would have been virtually free by Friday. What kind of grotesque, twisted illegal payback scheme is BAC management receiving to do this transaction which so insane on the surface?

  24. Bloomberg just showed a clip of Dick Bove giving an explanation of bankruptcy and marking down Lehman’s assets. Why do they even give that huckster air time?

    Nihilist, I was thinking the same thing about BAC this afternoon.

  25. Fly,

    What’s the play here? Yes, I am just an Internet leach but I need money too.

    Please throw us all a bone!!!!

  26. INDEX VALUE CHANGE OPEN HIGH LOW TIME DJIA INDEX
    11,252.00 -199.00 11,312.00 11,312.00 11,131.00 19:17

    from http://bloomberg.com/markets/stocks/futures.html

  27. they are on the front page of cme.com as well

  28. And the refiners?

  29. F-ing Loser- The play is (was) short the futures at the close this past Friday and then cover about 6:15 PM today.

  30. New ticker? Never seen this before. Maybe for the “bad bank” workout?

    LEHMAN BROS HLDGS (LHBI.PK)

    http://finance.yahoo.com/q?s=lhbi.pk

  31. He has already violated the rules about 5 posts ago …

    He used the word “Fargin'”, which in my books and in the books of many an Irishman would be a swear word.

    Even an Irishman would admit Fargin’ is swearing.

  32. I think the .PK means it trades on the OTC “pink sheets”, so it means that they’re getting the ticker symbol ready for the bankrupt entity which won’t have sufficient capital to be listed on one of the major exchanges… my layperson’s understanding anyway.

  33. TraderCaddy,

    Since I am a F-ing loser and have balls the size of Tic Tacs, I missed that one.

    I need a new play that I can’t F-up.

    Thanks in advance….

  34. Farg that, Shortbus, it’s not swearing ibc style.

  35. good news…..asia closed for holidays tonight and tommorow….so the real fireworks will be at 2am….Europe….

  36. Handles: based on your statement, The fed has another whole day to get this LEH deal done. As the Germans apparently warned/threatened the US that they should get the LEH deal done before the Asian markets open.

    No deal to be done till the Asian market open, great.

  37. The play would be to ease into GS or MS on any gap down at the open. They can’t remain as independents if MER goes with BAC. If they don’t gap down (it’s possible) step aside, turn off the computer, and enjoy the day.
    Raymond James and some of the regionals may be good plays on the long side.
    Gotta wait to make sure they get trashed real good at the open.

  38. CNBC is airing right now… Bill Gross, Harvey Pitt, all the regulars.

    -DT

  39. Bill Gross is a cunt.

  40. Hey everybody… Why so serious? …..Why so serious?

  41. F-ing loser,

    IMHO, if you’re not already positioned, you will have a hard time making any right moves, at least before 10:30 a.m.

    The best advice is probably to wait until Monday afternoon to see how things shake out.

  42. Fly,
    Any idea of their commodity positions? In particular energy related liquidation–Short or long?

  43. Are asian mrkts closed? I found this list of market holidays, not sure of accuracy:

    SATURDAY, SEPT 13

    SOUTH KOREA – Chuseok, Full Moon Festival – Market Holiday

    SUNDAY, SEPT 14

    SOUTH KOREA – Chuseok, Full Moon Festival – Market Holiday

    TAIWAN – Mid-Autumn Moon Festival – Market Holiday (No addition day off for it’s falling on weekend)

    MONDAY, SEPT 15

    CHINA – Mid-Autumn Festival – Market Holiday

    HONG KONG – The day following Chinese Mid-Autumn Festival – Market Holiday

    JAPAN – Respect for the Aged Day – Market Holiday

    SOUTH KOREA – Chuseok, Full Moon Festival – Market Holiday

  44. TC – I disagree.

    We were overbought going into today. Regardless of this news, we would would have sold off 20 pts on the S&P anyway.

    I think the gap lower will squeeze higher, and sell off worse into the close.

  45. Fucking loser, if you don’t know what to do, and aren’t already positioned, do nothing.

    Why pay commission to guess and probaby lose money?

    I can tell you with some certainty that if do something without having an idea or an edge you’re gonna lose money.

  46. lol @ 50 billion bank consortium…

    From where do you think that 50 billion was borrowed?

  47. Guys, it’s cool. Jim Cramer says that Lehman doesn’t matter. He said that as long as AIG gets the $40 billion in needs (LOL) that he’s a “buyer not a seller.”

    Whew! Confidence restored!

    -DT

  48. Nihilist Investor

    It is also somewhat insane that this news is such a “shock” to the market. Or, to phrase it more precisely, the market apparently was pricing in a very high percentage chance that the government would bail out LEH. This is a very sad fact and utterly nauseating it its own right. I guess this is one of the rare situations where the insiders privy to the roundtable discussions with the Fed, lawyers, and CEOs misjudged their own information leaks. I feel like I want to vomit for our country whatever happens.

  49. And for my most important comment – think Buffet.

    Day-to-day is noise, the fundamentals are what matter in reality, over time.

    Even if we end the day higher (not calling for that) it doesn’t change the reality of the situation. A BoA for MER is a bad thing, LEH failing is a bad thing, and neither one alleviates the problems the financial system faces.

    Same goes for a special 50b package from God-knows-who.

  50. I stabbed a knife into my laptop screen when I heard Cramer say buy AMGN tomorrow.

    I assume many of you did the same.

    …You know what that means — increased consumer spending! Buy AAPL!!

    lol.

  51. BofA must be expecting major share price erosion in their own equity for them to be bidding $29 for MER based on of BofA’s Friday close. It makes no sense anyway, let alone at $29/share.

  52. TraderCaddy,

    I understand easing into GS (Goldman) but I am not sure why you want to ease into MS (Microsoft). Please explain.

    WoodShedder,

    Thanks for the advice; I will probably wait until the afternoon unless the fly has a good play for the morning.

    Thanks Again!!

  53. F-ing Loser….you have to be at least 18 years old to play with a Scott Trade account.

  54. Wall St crisis fucking up my “Entourage” season premiere.

    http://www.hbo.com/entourage/

  55. The Fed is going to cut a full basis point in the morning.

    Youre welcome.

  56. Attention US banks: If you get a check from the $50B bank consortium that has “US Treasury” printed at the top, then scratched out and the words “Bank Consurtshum” scrawled underneath in crayon, please disregard this, uh, printing error. No taxpayer money involved. No sir. These banks are propping each other up out of the goodness of their hearts.

  57. That was last week Ari. Fucking-A, lay off the blow.

    wow, and there’s the BOA deal

  58. “Hah”. I made a great deal.

  59. John Thain, I think you meant

    ZING!

    Meatballs is saying it’s an all stock deal.

  60. BAC buys MER for $29 a share.

    There’s not going to be any brokers left to short tomorrow!

    DAMNIT!

    -DT

  61. BAC = Jesuits, they want it, just like they did Countrywide. Receivership.

    Feudal system restored.

  62. Gee, I bought MER for BAC stock. John Thain is a tough negotiator. Not even $2.00/sh cash.

  63. The Fly is God.
    SKF may open over 135 or something insane like that.

  64. There’s got to be a fascinating back story to explain why BAC bought MER tonight.

  65. Great fucking server, Fly. Seriously, how difficult is it to get a fucking server than can host traffic?

  66. Hey quit bitchin about the server… Ther’re back up. Don’t ya know that the PPT is trying to take the Fly off the internets?

  67. Actually Siv, I Jewbag McPhee have decided to offer EU .03/share. So lick my jewballs.

  68. Sitemeter stats: 700 people or so when site got fucked. The cursing should start tonight and the IT folks should be fired like LEH staff for this.

  69. Would it be that fucking difficult to get a server that could handle your traffic? Quit dicking around with your little PPT program. Call a fucking hosting company, pay $100 a month, and tell your gravy slinging “IT guy” to jump in a bag of dicks.

  70. We have determined the that “1bankcoins.com” site is the “epicenter” of the short seller universe. Therefore, we have instructed teenage Romanian hackers to “knock that shit off the cybergrid”, to protect the American economy from evil short sellers and… oh shit, YM just ticked below 11100. Fly may curse TONIGHT!

  71. Shut up you little turd. We own our own server. The IT guy is away and now back. We’ll be up in no time.

    Relax. I am not Lehman or some guy you can bully around. I’ll have your arms punch off for you.

  72. the PPT became self aware and shortly thereafter decided humanity is too retarded for any sort of banking, currency, trade, or even barter system. it is dismantling the world’s financial giants as we speak.

  73. We in the KNOW, should have no pity for any fucker who was long financial stock/s over the weekend. They knew the market risk, and tomorrow (barring a miracle), they will face the music.

    And, what will happen to all the shorts holding positions in Merrill tomorrow … I think I know, and it will very likely lead to more forced liquidation of assets.

  74. SQL injection attack, or what? Fuckers.

    Give ‘em hell you meatball loving IT guy.

  75. He’s kinda right, Fly, you ought be able to afford the 100 bucks a month to get a better hosting server.

  76. My guess, it was punyandy who hacked the site.

  77. Thanks guys, I will just sit on the side lines tomorrow.

    One last question. What do you think the BAC/MER deal will do to BAC Stock? I backed up the truck about a year ago and have been averaging down ever since.

    If BAC pops on the news should I unload?

    Thanks again and good luck to everyone!!

  78. Fly- where did you get the LEH top holding info?

  79. Expect BAC to open down 5. They WAY overpaid for MER. The arbs will be all over BAC. And, since it’s an all stock deal, the sellers will lean on MER too.

  80. My little magic 8 ball told me Lehman’s holdings.

    Go check them out. They are all accurate.

  81. CNBC reporting JPM buying WM?

  82. Watching CNBC Europe and the chick just said “CNBC has learned JP Morgan Chase is interested in buying a piece of Washington Mutual.” Did I hear that right?

  83. Fly,

    Thanks for the quick reply. I guess BAC is now a core holding for me. Oh well, at least my MBI holdings have been doing pretty good lately.

    Thanks again!!

  84. If JPM buys WM, the Dow will drop 600+ tomorrow.

    That would crush another Dow component.

    Short sellers can only pray this happens.

  85. F- loser:

    In order to hedge your BAC long, might I suggest selling short MER at the open or going long SKF?

  86. F-ing Loser,

    “I understand easing into GS (Goldman) but I am not sure why you want to ease into MS (Microsoft). Please explain.”

    MS=Morgan Stanley

    Does this help?

  87. wow. crazy weekend. glad i bought the SKF at the close on friday. of course now watch everyone go out and buy bank stocks tomorrow, just to be ‘contrarian’.

  88. Oops, yea, Morgan Stanley makes more sense.

    I might go ahead and buy a little SKF. Being positioned a little more neutral would be nice during all the volatility.

    Thanks guys.

  89. BAC’s buy price was just a way for BAC to let the world know: when you trade with BAC, the Fed is your counter party.

  90. Where is the board of directors for BAC? Probably at the afterparty on location at the NY Fed vault with DJ Paulson and Bling Ben, doing lines of blow with $100 dollar bills. Wait a minute ….. this kind of shit explains why all of our currency has coke residue on it.

  91. Fed accepting equities…..BAC will turn around and sell MER to the Fed…..a big cash infusion for BAC ??

  92. Fly, what are your thoughts on energy/commodities with the dollar falling on this news? Will the dollar/commodity trade resume or has it disconnected?

  93. Never mind Fly …. Futures have both gold and copper up with dollar down …. oil may want to test support here before moving up again but a rate cut could change that.

  94. I think this put in nail in the bottom, messy open and maybe some fun days ahead but I AM CERTAIN THIS XLF PLEX HAS SEEN THE BOTTOM…

  95. Might be wiser to buy UYG on close. Too late to buy SKF now. Another rate cut wouldn’t surprise me a bit. The Three Stooges (Bernanke, Paulson, & Cox) seem to have a hard-on for shorts in general and iBankCoin in particular. Such is life in the Union of Soviet Socialist American States.

    Das Vidanya, Comrades.

  96. Good morning to all. Go long lead and gunpowder. Keep your head down, if you want to keep it, the spaghetti is poised to hit the fan. It will be messy. The suicide rate among investment bankers is gonna spike big time.

  97. Meanwhile, crude below $100.

    -DT

  98. Send lawyers, guns, and money. The shit has hit the fan.

  99. I can hardly wait to hear Kudlow & Luskin’s spin on these End Times for Wall St. We can only hope these are End Times for apparatchnik talking heads.

    Pay attention to those who called this all along like The Fly, The Jake, The Fleck, Marc Faber, Nouriel Roubini,….

    Nouriel Roubini

    “This is indeed the most severe financial crisis since the Great Depression and occurring at a time when the US is falling in a now severe consumer led recession. The vicious interaction between a systemic financial and banking crisis and a severe economic contraction will get much worse before there is any bottom to it. We are only in the third inning of a nine innings economic and financial crisis. And the only light at the end of the tunnel is the one of the incoming train wreck.”

  100. Are you ready, Skee Daddy?

  101. Mea Culpa –

    “This result is far different than what I had envisioned for the company. It was my view three weeks ago, that the company must merge; that management would resist a takeover; and that the merger would be hostile.

    It was further my belief that the company’s assets were not in devastatingly bad condition. That if given time they could be worked out without a major negative impact on shareholders. Moreover, it appeared that the company had generated $3.5 billion in revenue and $0.6 billion in pretax profit excluding the write downs of questioned assets in its third fiscal quarter (ended August 31). Consequently, I moved the rating on the stock up to a Buy.

    This view was clearly incorrect. After extensive negotiation with other financial companies and the effected government divisions, no buyer was found and the government chose not to intervene to assist the company. Thus, we are stepping into uncharted territory.”

  102. Cool. EEV’s up 7.24% on the first trade pre-market.

    Where’s that bald-head Lenin clone? Shouldn’t he be on Pom Pom TV, telling us all to buy banks? Booyah indeed.

  103. Hey guys, no joke here…need help

    I was one of the lucky ones to have bought Merrill Lynch at the close on Friday. It was a substantial amount to me, and I was wondering how should I play this out.

    As of now Merrill @ $23.11. Isn’t the share prices suppose to be at $29?

    Many thanks,
    HC

  104. Reggie is doing a great job covering this mess

    http://boombustblog.com/

  105. Morning Juice :P

    Last time Kudlow “sort of” admitted defeat, it marked a short term bottom.

    Everyone is talking these investment banks, how is it that the monolines are still around?

  106. HC – sell. The reason you are not at 29 is the risk the deal does not get done. If you are lucky enough to scalp 37%, take it. If the deal does not get done MER goes to $0. Sell it three ways from Sunday. Sell it. Sell it now. Do not wait for more news. Sell it. Take it. Book it. Buy a nice watch.

  107. anyone else thinking about selling SKF at the open? up 15% in pre market, i’m thinkin about taking profits before the Plunge Protection Co. Steps in.

    Fly are you a buyer or a seller here?

  108. HC

    think. Use your brain. It’s a share swap, right? So read the provision. BofA will offer x BofA for merril stock. It’s ratio which means you still have market risk. If you don’t know that shit, you’re too stupid to trade, so you ought to stay away from it and treat like a lucky break.

  109. I am just asking because Merril was heavily shorted as of Friday, therefore wouldn’t there be a huge short squeeze?

    Thanks for your help Boomer.

    “J”…what the fuck is your problem? I am just asking a question.

  110. HC – I agree with the others, you caught a good trade don’t get greedy, get out of it now. Same with me and SKF, the government -will not- let this market crash like it should have ~3 times this year already. I’m gonna put in sell orders around $130 and get the fuck out.

  111. Yo, the refiners??

    WNR way down in pre-market>>>

  112. SKF has hit 126. When do you want to sell?

  113. Anyone think we can rally outta the hole for 2 – 3 days? I think thats possible. I’m thinking this move lower in oil/gold is more likely a forced unwinding that will rewind & can be bought.

  114. 126…..pffffft

    Chump Change divided by 3.

  115. XLF’s at $19.76. It’s been holding at $19.75…

  116. With oil getting pounded again, are the refiners finally seeing the light of day? They are trading down premarket but oil seems like it wants to go to $80.

  117. I can’t take it anymore :) That idiot Pisani was just babbling about a mid-day rally.

  118. According to a report on The Insurance Insider, Warren Buffett is now in rescue talks with American International (AIG)

  119. Juice, there will be some kind of idiot parade rally after the initial wreckage. Nothing more than more trading opportunity. This thing is going to get ugly. Clubbing baby seal ugly.

  120. anyone think it’s takeoff time for SRS? commercial real estate hasn’t been hit yet!

  121. Crack Spread update: $15.26

    Looks like my calculations are correct, as all stocks such as VLO, TSO, WNR, ALJ, etc … are all probably going to open at least 10% lower, just as the crack spread is at least 10% lower from over $18.

  122. CNBC talking heads will be spinning like a top today, in their minds, they will be trying to avert a panic in the market.

  123. Cashin thinks there might be a capitulation today. He’s one of the few who knows what’s he’s talking about.

  124. Palin – comm re is gonna need earmarks, massive earmarks. see what u can do

  125. wow. i don’t think i’ve ever seen the dow futures this low.

    oil is a wild card. could be a moderating factor in the market decline.

  126. Breaking News from MarketWatch a division of Wall Street Journal. Must be a SLOW news day for them :-)

    9:27 AM today
    New – NYSE Trader: ‘We’ll get through it’ – MarketWatch

  127. So why is SKF only at 126??? I want it to be higher!

  128. Hmmm , GREAT … just GREAT … this is just waht i need from my broker RIGHT NOW !!!!

    Service Temporarily Unavailable

    The server is temporarily unable to service your request due to maintenance downtime or capacity problems. Please try again later.

  129. You sure were right about spin, Boca. I knew they’d bring that fool Cramer out.

  130. Why did the DOW open only -90?? That’s my bazooka fuckers.

  131. PPT in full effect this AM. What kind of heebery is this?

  132. hahah wtf they came out of the gate BUYING banks. i fucking knew they’d pull some bullshit like this.

  133. Gee, I don’t know. Perhaps it’s because the Soviet Central Bank now accepts equities as collateral? They’re not about to take a loss on them.

  134. Just short sellers taking profits. It’ll drop like a brick soon enough.

  135. recusancy: brick dropped

  136. Oh man I really just want to buy some GS down here

  137. GS is the cream of the crop and thats being proven now – Its a damaged stock not a damaged company.

    When the dust settles only MS and GS will remain

  138. Let the market come off the lows & rally to wednesday … then get short HUGE because UGLY will be the rest of sept into october.

    This is a requisite technical rally. Let it happen.

    We are NOT finished going down.

  139. Took about 10 minutes but I bought and sold my usual SMH for about a 2% gain. I am now taping my fingers to the back of the chair and will just watch for now.
    Noting Trin is below 60 which is a buy. I would like to see the VIX get into at least the mid-30s though.

  140. Does anyone know if all of the DJ 30 stocks opened in the first 5 minutes of trading? If not who was late?

  141. OK, FUCK IT … now this is NOT funny . time to change brokers.

    —————

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    An error has occurred on our Web site.

    We’re sorry, the web page you requested is temporarily unavailable. Click here return to your home page.

  142. Dick Bove Says Banking Is Sound – Time to Buy Financials?
    by: Todd Kenyon posted on: March 10, 2008

  143. Todd Harrison

    09:36:55 AM

    position in uso

    Gate Sniffage

    * I just heard someone on TV say “the good news is that oil is down $5.” That’s NOT good news through the lens of deflation as it’s endemic of slowing global growth. I will, so it’s said, nibble on some USO (small) with an ear towards a rate cut and an eye towards a bounce.

    * I’ll be scanning my screens for green beans this morning but it–and everything–is purely a trade. First blush, I’ll note that Amazon (AMZN) is only down $1.70. That, to me, hints at some underlying demand.

    * We’ve spoken about The State of the Art in the financial industry for some time. With three of the five top-tier brokers–Bear Stearns, Lehman (LEH) Merrill (MER)–disappearing this year, it’s safe to say that the future is now. It’s not something one would wish for–and our hearts to out to our fallen friends–but I’ll again offer that it was necessary medicine on the road to recovery.

    * Those of us who traded the Asian Contagion, LTCM, the dot.com implosion and the aftermath of 9/11 will tell you that price discovery is a process rather than a point. It’s entirely alright to be opportunistic but it’s more important to remain disciplined. These are unchartered waters and risk management should trump reward chasing.

    R.P.

    ———————————-

    MV Respect

    09:30:08 AM

    No positions in stocks mentioned.

    Minyan Jeff Saut’s Call For This Week
    Warren Buffett is fond of saying, “You only find out who’s swimming naked when the tide goes out;” and evidentially the biggest “nudie” is Merrill Lynch (MER) since the Illuminati decided to save it and let Lehman (LEH) “go.”

    Clearly, Czar Paulson does not think the government should be in the business of assuming credit derivative risks (CDS’s, etc.), which is the real story going forward. Plainly, dealing with the derivative, and counterparty, risks will be the next piece of the puzzle as things continue to get curiouser and curiouser. The ideal daily pattern for today would be for a hard down opening followed by a rally attempt, which fails, leading to an afternoon downside “washout” and then firming into the close.

    Any closing strength should be viewed as a positive since that would likely indicate a skein of positive closes. While more conservative types should probably wait for the aforementioned pattern, more aggressive participants should buy the hard down opening on the belief that Paulson and Bernanke are cognizant of markets and will not want to see their “trifecta” come unraveled. Consequently, the Fed will be pumping money, short-sellers will be monitored, corporations will be urged to institute share buybacks, and mutual funds will be forced to buy. Being value buyers, the institutions will likely buy the drugs and food stocks first and then technology. As for my firm, we will be using ETFs.

  144. shortbus: i tried to sell my SKF at the open, and my fucking order kept giving me invalid session bullshit. cost me a few pts before i could get it resolved. that’s some first class bullshit, not unlike what you’re dealing with.

    juice: i like your idea.

  145. […] The Fly discusses the faults with the Bank of America and Merrill deal. […]

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