Lehman Brothers' Sudden Bankruptcy Wiped Out As Much As $75 Billion

Lehman Brothers Holdings Inc's emergency bankruptcy filing wiped out as much as $75 billion of potential value for creditors, The Wall Street Journal reported on Monday, citing an analysis by the bank's restructuring advisers.

Read the whole story here.

Comments

[netDockets]

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[RebelPatriot]

It did not wipe out $75 billion

It merely transfered it to someone else.

wealth, like energy, is not created or destroyed. it merely changes form/ownership.

[loki]

Here is what bothers me. Everyone is saying this money is lost. But its not, its going somewhere. Its not just going up in smoke. Someone, somewhere, has all this money that is no longer being circulated. Who is the one who is gaining from all the losses? Where is all this money going? No one is really answering that. They are just saying it is disappearing.

[drkazmd65]

Well,... a lot of it is 'disappearing' loki.

A lot of the 'value' that has been lost never actually existed except on paper, and in the minds of those speculating.

A leveraged (20 or 30 : 1) credit purchase never actually had any value except that asset used as initial collateral. Ofter (or so I read) the collateral used to back the leverage was actually already leveraged in some other deal.

The first time one of the leveraged purcahses couldn't make a margin call or such, the collateral had to be used,... but then (since the collateral) was often essentially worthless,.... the whole thing started to collapse like a house of cards.

The only people IN the system that got any money out of it were the ones collecting big fees, big salaries, and big bonuses. A lot of the rest of that money never really existed except in somebody's creative bookkeeping and imagination.

[johncando]

you would think the trillions opec has might be the same as China and the money the government spends on the security for nothing ,Then the USSR went t.u. because of Afganistan, Buy Honda and Toyota the money is gone and you wonder.TOO LATE!

[brooklyncitizen]

oh what's a mere 75 billion when one man MadeOff with over 50 billion?

[ibsteve2u]

lollllll....I see those English teachers yelling at you all of those years just wouldn't let you leave that "e" out...

[jerrypl]

President Bush insulted the intelligence of America! He cranked that "Wall-Street got drunk." But it was he that was their bartender. President Bush, his multi-national corporate cronies, his Congressional collaborators, and the greedy financial institutional sector created the world"s biggest Ponzi Scheme. They used the incomes from the middle class, by increasing their debt burden, and stagnating their wages, while enticing them with low interest rates. At the same time, they sold off America. By increasing their debt burden through cheap credit offerings, the financial sector vampires sucked out their real wages and "Ponzied" investors by inventing investment vehicles, which, ultimately, exploded leaving the nation virtually bankrupt. This has been going on for 30 years, but ballooned under this administration. Where is Obama"s outrage? Where is Congress"s outrage? Where is the media"s outrage? All silent! Yet, I am outraged!

http://eye-on-washington.blogspot.com

[ranchero42]

It's pretty clear that there was nobody minding the store when all this crap happened. Tell me again why people who can't be trusted with other peoples' money can be trusted with bailout money? Who's making sure these boys don't leave the scene of the crime until we've got a handle on it?

[SharonWantsToTalk]

No matter how carefully they negotiated the downfall, you can be assured the money would have made its way to the managers and shareholders way before it got to the creditors. Not that different from how it actually went down. Money will always protect money.

[tomas0808]

I would say Eat The Rich but their flesh is sure to be toxic and totally corrupted

[ranchero42]

Brokers. Taste like reptiles.

[watchingthings]

Don't degrade the taste of reptiles.

[lj9283]

Anybody notice the the Bush family got themselves a bank out of the Lehman bankruptcy?

George H. Walker, the president's cousin did a deal with two private equity firms to buy up all of Lehman Brothers good assets, while leaving behind all the risky stuff.

http://www.financialweek.com/apps/pbcs.dll/article?AID=/20081008/REG/810089997/1036

Can anyone say shenanigans?

Pualson did good by the Bushs.

[BobTrader67]

Lending money money is an important part of our economic system, people aren't leeches to lend money, without credit we would not stunted growth. The blame here lies on the investment bankers themselves. They created false products, and disregarded risk (what should be any bankers number one priority) for quick profits. Their arrogance was unbearable, and I think this whole situation is something many people see as a doling out of justice. Check out this website http://www.freetradingquiz.com Cool site for traders...

[TJCole]

Look Paulson couldn't help wanting to bury his old competitor and that of Goldman Sachs...no matter how many people it hurt or the negative ramifications for America's economic system..!

[bayviking]

The US leadership robbed $6 billion in cash from their European subsidiary, to reward themselves for a job well done and leaving their European office with a payroll deficit.

The lying cheating and stealing that's going on is unprecedented. Bush's last call.

[Meesterclean]

It is very sad. People came to believe that banks run the economy. No, they, like slave masters, are only beneficiaries.

[TJCole]

Not so much beneficiaries as, leeches..!