The London Times has a whiff of a scandal and is all over it. Apparently JP Morgan withheld $17 billion from Lehman, causing their financial crisis last month that led to their collapse. Bankruptcy hearings are underway and the details are expected to be brought up in open court.
Of course, they were asked to give them $17 billion 48 hours before they went bankrupt, so maybe they knew what they were doing. Expect several more things like this in the next few weeks.
JP MORGAN has been accused by its Wall Street rivals of dealing the final hammer blow that forced Lehman Brothers into collapse in a sensational claim that threatens to spark a colossal legal battle.
The giant American bank is alleged to have frozen $17 billion (£9.6 billion) of cash and securities belonging to Lehman on the Friday night before its failure.
Congress was given a choice. Do something, or face global economic meltdown.
Reports are coming in today from the New York Times of the late night meeting between the Fed, Treasury, SEC and the leaders of Congress.
As Senator Christopher J. Dodd, Democrat of Connecticut and chairman of the Banking, Housing and Urban Affairs Committee, put it Friday morning on the ABC program “Good Morning America,” the congressional leaders were told “that we’re literally maybe days away from a complete meltdown of our financial system, with all the implications here at home and globally.”
“What you heard last evening,” he added, “is one of those rare moments, certainly rare in my experience here, is Democrats and Republicans deciding we need to work together quickly.”
You do have to wonder if this was an example of coordinated financial terrorism.
That’s what you get for invading your neighbor.
Regulators halted trading at midday (9am BST) on Russia’s main stock indices – the rouble-denominated Micex and the dollar-denominated RTS – following a similar suspension yesterday.
Russia has been badly affected by the global financial crisis, and has suffered as stocks have sunk in Europe and Asia. But it has also been hit by the rapid fall in oil prices and the flight of foreign investors since the war in Georgia.
Of course had we not bailed out AIG last night, we could have seen something similar in the US, UK, Tokyo etc as a number of institutions fell apart. I was watching shares in my local bastard monopoly
electric company Consolidated Energy Group (CEG
) yesterday. CEG was tied to Lehman and rumors had some exposure to AIG that would have dragged them through the mud. Their company, which has about $15 billion worth of nuclear power plants suffered from some massive shorts and saw the stock drop from about 60 to 13 in a matter of minutes, then up again, then down. It was really strange.
More excitement today as I deal with a quick sale of Washington Mutual stock (WM