This time last year I was an equity analyst at Lehman Brothers. As the firm collapsed, I sent a series of notes to my friends and family with my take on the situation. To coincide with the anniversary, I have been publishing those observations here one year later. [Photo: Reporter outside Lehman HQ]
No News Except for What You Can Read for Yourself if You Are Interested
Originally written Sunday September 14th, 2008, 7:30
Just finished the call, which was infiltrated by third parties. They said literally nothing.
I think neither "side" is blinking.
One side believes that Lehman can fail without disrupting the wider marketplace and the other believes that either it can remain as a going concern long enough to pull off a miracle or that the Fed will blink in some way that doesn't look like a bailout. In the meantime watch proxies for both sides either say everything will be fine or the sky is falling. Bill Gross, one of the nation's richest men but someone with a lot to lose if Lehman fails, is screaming at anyone who will listen that tomorrow "we are facing a financial tsunami." Others are more sanguine. Tomorrow will be historic. Lehman must file bankruptcy by 11:59pm tonight (I think Central time because a lot of the contracts they need to cover are traded in Chicago) but tonight anyway. The end will probably come quickly. Everybody has an interest in an orderly liquidation of Lehman except for those who have nothing more to lose and the vast majority of those people are good enough to play along, I think.