Karl, now posting at Patterico’s (where thor isn’t, I guess) looks into the potential bankruptcy of Lehman Brothers Holdings Inc., and names names.
Meanwhile, from the WSJ:
By taking the rescue option off the table, the U.S. government was declaring that there are limits to its role as backstop-in-chief. A week earlier it had seized mortgage giants Fannie Mae and Freddie Mac, and months prior had brokered the sale of Bear Stearns & Co. to J.P. Morgan Chase & Co. But now, Washington appears to want Wall Street to largely fix its own problems, and feels that flailing institutions shouldn’t expect the government to commit money to save them.
“We’ve re-established ‘moral hazard,'” said a person involved in the talks, referring to the notion that the government should eschew bailouts, since financial firms might take more risks if they’re insulated from the consequences. “Is that a good thing or a bad thing? We’re about to find out.”
One immediate impact: As Lehman’s future darkened, Merrill Lynch & Co., another vulnerable firm, raced into the arms of Bank of America Corp.
This account of the weekend’s events was compiled from interviews with Wall Street executives, traders, government officials and other participants in the talks.
Barring some last-minute, late-night alternative, Lehman will likely file for liquidation, people familiar with the situation said.
The storied firm’s decline occurred in slow motion this year. Heavily exposed to troubled real-estate investments, the firm tried to raise fresh capital, only to be thwarted. The most recent disappointment came last Monday when a possible deal with a Korean bank faded, sending Lehman’s shares down 45% the next day. They had already fallen 80% since the start of 2008.
As Karl notes:
As Obama wasted no time in blaming “the last eight years of policy†for the current situation, perhaps he ought to re-read Austan Goolsbee’s defense of the subprime mortgage market. And the media ought to ask whether Obama agrees with one of his top economic advisers about it.
(h/t TerryH)
****
Oops. Looks like Dan already mentioned this.
Karl is now working closely with Patterico and Ace. So fly away, all ye Karl groupies! He’ll show me to “choose thor” over him!
Thanks, thor. Thanks, Karl. Guess I wasn’t generous enough with my site for either of you.
Fuck it. I have a kid to take care of. Let these guys play their games.
Fuck Fannie and Freddie. If they’re insolvent, then they should go down, and their shareholders lose their money. All those mortgages?
Congratulations! You now own your house. The lien-holder went out of business.
I will visit Karl cause it’s Karl and he was our friend but you are the protagonist in this story I think.
I don’t think Baracky has half a clue. I hadn’t seen Darleen’s link last night about how Baracky totally lied about his big shot Wall Street job that wasn’t… He turned his back on Wall Street he likes to say, you know, for the people. Liar. He had a crappy job is all that was about, especially for a Harvard grad. But Baracky can try and wallow in economic pessimisms and culpabilities all he wants and the more he wallows the more clear it will be that his marxy-changey agenda is goddamn frightening in a context of economic turmoil.
Drilling oil creates many good jobs.
Checked out Karl – got a big dose of datadave. You’ll be glad to know that dd has a single-digit handicap in stupid.
still
I wonder if O! will denounce himself for getting big money from Lehman; ‘Cuz you know he’s gonna start wailin’ about how much money their eeeeeevil CEO was makin’ in…5…4…3…2…
Baracky is a whiner. A whiner what has never employed anybody in his whole life. For real on the economy he should let the adults take care of things I think.
That Jill Greenberg person who photo’d McCain for The Atlantic took other pictures I’d never seen. Crying babies she created: “The children are provoked by Greenberg taking away their candy or toys. This technique is known as “manipulation.” She’s really good at this.
(h/t Jim Treacher)
Baracky is a whiner. A whiner what has never employed anybody in his whole life. For real on the economy he should let the adults take care of things I think.
happyfeet that brought to mind in the days immediately after 9/11 a lot of the pundits and even some dems talked about how it was probably good that GW Bush got elected. Its probably the last time I ever agreed with them.
Hey, Greenberg’s a photographer. Manipulating images is what she does. I have no problem with that.
But I bet the Atlantic has a big problem with her basically ripping off images they bought and paid for.
Oh, for God’s sake, Jeff.
I’m glad to know Karl’s still doing what he’s doing.
thor has some serious psycho-social issues. He won’t listen to anyone, even the site’s host. I don’t know what can be done with him.
Other than thor, I think this is better off left in the past; i.e. ignore this crap.
mojo @ 2 —
If you have the time, this C-Span Q&A with Peter Wallison of American Enterprise Institute may convince you of why F&F had to be bailed out. Bear Stearns, also.
You’ll also be shocked — shocked I tell you — to learn that Bush was hostile towards Fannie and Freddie — for the right reasons even! — and unlike his predecessors, never made any appointments to the board of evildoers.
O cudlips.
Still you are blinkered.
This is the result of demagoguery, the greatest fear of the Founders, the thing the electoral college was designed to prevent.
You elected GW to office, a person intellectually unfit to serve.
And now you are attempting to elect Palin.
Please recall post 911, inorder to stave off a recession, GW told America to “go shopping”. And colluded with Greenspan to drastically reduce interest rates so that Americans could use their homes as cast machines to “go shopping”.
Without the vision or intellectual capacity to understand the housing bubble and the welfare mentality of wall street that this foolish action would create.
This is what happens when you elect a President that is stupid enough to believe to believe in creationsim.
What also happens is the devotion of 7 years of the bush admin to the Grand Misadventure of the Manifest Destiny of Judeoxian Democracy, of our blood and treasure squandered on the megalomaniac plan of someone too stupid to understand that the massive amount of contrary scientific data utterly destroys his antique belief system. You think a belief in creationism should not disqualify someone for office?
Look at Wall Street today and tell me that.
This is exactly what Jefferson and the Founders sought to prevent, the election of someone intellectually or otherwise unfit to lead. The election of a popular demagogue, a culture-crusader, that puts their world view and ideology before the good of the Nation. That is actually incapable of doing anything else, because of their limited intellectual capacity.
And now you want to elect Palin, for more of same.
Go ahead, “Hockey Mom to the Rescue”.
Stupid cudlips.
Ack! It rose from the crypt!
Lol!
Chickens all the way down.
“…colluded with Greenspan to drastically reduce interest rates…”
Have you got honest evidence for this claim? I don’t think so.
oh. hi, nishi. Ok nevermind my last comment over on that other thread. I will have to think more I guess.
apolos
CASH machines.
lollololollol!!!
Well we all do need, desperately need, to be reminded how very stupid we are and will continue to be (no doubt faulty genetics are at play in us here). Even if she can only get away from her important stuff to get back here to provide that free service once in a while, we still ought to recognize the help, and thank her therefore, don’t you think?
ah…yess….Greenspan decided to do that on his own?
Hes a l33t.
He’s had economics 101.
I think….maybe this will get stuck onto Bush.
I’m hopeful.
So I guess your answer is no, just for the record?
Please do not feed the early-onset Alzheimers.
There is years of pain devolving from this.
It isnt over yet.
Do you think the cudlip ticket is going to be able to extricate us from this mess?
The Septugenarian that “doesnt know anything about economics” + vaporware-resume journo major Palin?
The republicans made this mess.
That is why David Brooks says the republicans are intellectually unfit to govern right now.
Well….Jeff…..this is really for you.
I dont expect to reach anyone else here.
and thats enuff fun for now.
I hope i didnt damage your hit count too badly.
This is the result of demagoguery, the greatest fear of the Founders, the thing the electoral college was designed to prevent.
Nope, it was simply greed — including, but certainly not limited to, the congressional variety, on both sides of the aisle. Ask Barney Frank.
I look forward to your detailed analysis of that Wallison video.
Yes the Founders understood greed very well.
But Demagoguery was their greatest fear.
Jeff, how about a post on how to get out of this mess?
About promoting austerity and service instead of blood and circuses and guns and religion?
About being a citizen first and not just an ignorant tribesman?
Aw crap, Slart, and here I thought I was going to get yet another free lesson in higher order economic thinking and you step in to suggest I deny myself the opportunity for personal growth, not to mention the pleasure? You?
Lol.
Shades of JFK.
austerity and service.
My post on “how to get out of this mess”:
Don’t hand all the branches of government over to a single party, particularly a party that embraces a kind of soft socialism.
The end.
My post on Jeffersonianism.
Keep the leadership role from the cudlips….oops….meant teh Noble Yeoman Farmer.
What is GW’s market welfare and inflating housing bubble but thinly veiled socialism?
go shopping
right.
but Obama tells me he hasn’t done enough.
gee Aldo…exactly who was GW the front man for?
Karl Rove?
go shopping maggie.
its better for u cudlips.
;)
um, yeah, I just remembered I have other things to do today.
like shopping?
About promoting austerity and service…
What’s interesting is that Fannie Mae set up a charitable foundation that sent quite a bit of money to groups promoting service. Of course, in return, they’d demand that those same groups call their congress critters if there was something brewing that might hurt their benefactor.
So there you go — promotion of service, in service to corruption. Kind of like Baracky and ACORN, I’m thinking. Austerity? Not so much.
I went shopping and got this thing from a Salvadoran bakery here in LA called a quesadilla … but the thing is, it was a round sort of flat pastry with parmesan and other cheese I can’t remember, and it was extremely not healthy. It was funny cause it’s about 8 inches in diameter but the nutrition label said the whole thing was “one serving” … which turned out to be like 42 grams of fat and lots of that saturated and 720 calories. It wasn’t very sweet but the texture was amazing and I think I’ll get some of those to take home for Christmas. I ate the whole thing.
Lol!
the Septegenarian/Hockey-Mom ticket is proposing more regulation of financial entities!
now thats a solution…..not!
And what is the Dork/Doofus ticket proposing?
Oh. Here is a recipe. For real it had a very holiday feel to it. I will try to make my own but I guess from looking at the recipe I will need a sifter. I don’t really know anything about sifting. Maybe there’s a youtube on it or I can ask SarahW later. I remember seeing a lady use one of those when she was making biscuits I think. I should get a round baking pan that’s the same size as the one I bought. Maybe that tortilla warmer thing I never use would work.
‘feets, a small mesh colander will work as a sifter. Just shake.
Got it. Other Guy just explained sifting to me. I have a little thinger that will work, and he says just whisk the baking powder into the flour and you really can’t screw it up. I think I might add some vanilla to the recipe though. And this is where things begin to go terribly wrong.
“Quesadilla con queso”?
As opposed to what? A quesadilla without cheese?
Sifting is way overrated…….and…………You will make a mess and have to clean it up. Remember? OHNOES………Yiiieeeeh!
Other Guy says you don’t want to add vanilla cause it will make it taste like a cookie. We’ve worked together for four years and that’s how well he knows me?
As if Obama would prosecute Cuomo for instituting approval of sub prime lending at these two agencies while heading Housing under the Clinton administration or that he’d disavow the Community Redevelopment Act pushed through by Barney Frank and his uber lefty allies under the prodding of Jessie and Al.
Its time to jauil those in these two agencies and within the government who squandered billions while feathering their own nests. By the way I wonder if Obama will volunteer who much he received from both these agencies as campaign contributions.
He is a loathsome toad.
I would love to have a cookie right now. Or pie.
mmmmm, yeah. I was good and didn’t buy the Halloween funfetti frosting today. but there will be cupcakes in the near future. probably the second weekend of the show cause everyone brings stuff for opening night. just have to figure out what kind would be best for My Fair Lady. I’m all about themes.
cockle cupcakes?
#50 Maggie:
Scones, you can’t go wrong with scones. Mmmm, raspberry scones.
Oh! And the little tarts! My grandma and mom made those! They were the best!
I got to get that recipe.
I know I’m supposed to care about he subprime market and all the very serious dangers it means for our economy, but really…
enh. the market, she will fluctuate. The government, it cannot this fix.
Enjoy your drama.