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Will Lehman Be the Crunch's Next Victim?

Shaky confidence means its biggest fear may be fear itself

By Rob Quinn, Newser Staff

Posted Mar 18, 2008 4:52 AM CDT

(Newser) – After a collapse of confidence sank Bear Stearns last week, some traders are betting that Lehman Brothers will be the next victim of the credit crunch. Its stock went on a rollercoaster ride yesterday—plunging 40% at one point and closing down 19%, the biggest fall since the firm went public. But analysts, wary of giving vultures more reasons to circle, are watching what they say about the brokerage firm, Marketwatch reports.

"Just commenting on it seems to give it more credence," a professor at Harvard Business School said about Lehman's supposed woes. Many on the Street think that Lehman is in better shape than Bear Stearns was, and today's first-quarter earnings report will be watched closely. But the greatest threat to Lehman might be the waning confidence of its investors, rather than the state of its finances. At that point, said one analyst, "no level of liquidity will be sufficient."

The headquarters of Lehman Brothers is shown on Monday, June 11, 2007 in New York. (AP Photo/Mark Lennihan)

Edward Sweeney, left, of Lehman Brothers MarketMakers and Peter Tuchman look at a monitor from the floor of the New York Stock Exchange, Friday, Mar. 14, 2008. (AP Photo/Henny Ray Abrams)

Marco Picone, right, and Michael McDonnell, both of Lehman Brothers MarketMakers consult on the floor of the New York Stock Exchange, Friday, March 14, 2008. (AP Photo/Henny Ray Abrams)

Portraits of the founders of Lehman Brothers adorn the walls of the investment bank's offices on Wall Street. (NYC20928) (Magnum Photos)

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Will Lehman Be the Crunch's Next Victim?

Shaky confidence means its biggest fear may be fear itself

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Will Lehman Be the Crunch's Next Victim?

Shaky confidence means its biggest fear may be fear itself

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OTHER STORIES ON OUR RADAR

Wall Street • Bear Stearns • financial markets • Lehman Brothers • brokerage • subprime crisis • financial crisis

MOST POPULAR STORIES

[ By Views ]

[ By Comments ]

More Newser Stories

Cramer: Never Seen Wall Street This Bad

Analyst sees no end in sight for layoffs and write-downs

Lehman Posts $2.8B Loss, Stuns Wall St.

Investors fear that banks, securities firms still in trouble

Lehman Is Selling $3B in Shares

Firm seeks to calm fears of another Bear Stearns disaster

Investors Ask: Who's Next?

Wall Street survived the near-collapse of Bear Stearns, but there's more trouble ahead

After Meltdown, 'Safe Will Be the New Sexy': Cramer

'Good, clean, old-fashioned banking' is coming back in US markets

About Us

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Newser By Users

Community

Site Maps

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More News

What is Newser?