Lehman Brothers and You

Punish the doers, Punish the doers, Punish the doers, Make them clean up the mess with their wallets from behind bars, and prepare the guillotine Show them the same mercy the had for our futures and our childrens' futures. Do unto others !!!!

I am just glad that none of these executives (CEOs and CFOs) are managing my household budget. All I would hear is, "buy, buy, buy, borrow, borrow, borrow, spend, spend, spend" and I would be bankrupt. I could say the same thing about our elected officials, ie "...spend, spend spend". Maybe that's one of the reasons Sarah Palin appeals to the average American. The average American sees that she manages the money entrusted to her (governemetn budgets) the same way she manages her household budget.

A great line from the movie tombstone..."Make no mistake, there will be a reckoning." My whole life has been predicated on personal responsibility. This being instilled by my Jesuit educated father, my teachers, and my mentors/ seniors during my military career. I struggled as a younger man but in my 41st year, I get it. While I try not to judge others I cannot escape the voice inside that drives my moral compass. Where is the accountability? Clearly this is a disaster predicated by individual misdeeds. My expectation is that there will be a ‘reckoning’. There has to be.

I was just reading an article that many businesses find federal acts like Sarbanes Oxley onerous and how it puts American businesses at a disadvantage with businesses oversees. However, because of unrestricted greed, millions of people will be suffering losses today and in the coming times. If we don't want government controlling and monitoring everything then we need to start holding the people who allow fiasco's like this directly accountable from a fiscal and legal standpoint. If the CEO, CFO, CIO et al knew that they would go to jail and/or be fined millions of dollars because their company was making bad loans and then selling them off to be packaged into derivatives I believe they would think twice. We need to take away the corporate veil and start holding real people accountable because it's these people who will walk away from these companies (like Lehman) with millions of dollars in bonuses, stocks, and of course their massive salaries.

You left out the cleanup costs passed on to the taxpayer too.

The three largest investment banks in the world are done. Don't you get it? Derivatives of 50:1 of the CDOs took them out. Greed took out Wall Street. Think about it...........

The whole thing boils down to (please correct me if required): (1) The 'Credit' is the product of banks. (2) Likelihood of one of the largest bank's closure means, production and availability of 'Credit' will be lowered substantiality. (3) In terms of Demand and Supply theory, the Supply will be reduced heavily, while predition of Demand is not stated, hence assumed steady. (4) We know that, when the demand is much higher than supply, the prices soar. (5) It implies that credit will be more expensive commodity, probably by means of interest burden (the price for credit). (6) The commercial and personal borrowings may experience slowdown due to increase in cost of borrwings. (7) The industrial output that depends on heavy borrowings, will show negative trend, affecting profitability and asset building of companies worldwide. (8) That is the reason for fall in stock prices all over the world. (9) If more banks show the likelihood of going 'down under' the mood in stock markets will be clearly negative. (10) Recommendation on stocks and real estate will be reduce exposure, sell today buy tomorrow?

Some of the big honchos -- Wilbur Ross for one -- called this in the spring. The shakeout might last until the spring.