Lehman Shops Key Unit in Quest for Cash

Private equity eyes trading territory ceded by changes at Goldman, Morgan Stanley

(NEWSER) - With the last two large US investment banks going commercial in an effort to stay afloat, private-equity and hedge funds are stepping into the void, the Wall Street Journal reports. Taking on roles previously filled by the likes of Goldman Sachs and Morgan Stanley, hedge funds like Citadel and private-equity groups like Blackstone are "stepping further into the risk-taking fold," the Journal notes, and are positioned to profit handsomely. More»

Banks, like homeowners, refused to believe how bad things really are

(NEWSER) - The collapse of Lehman Brothers and the fire sale of Merrill Lynch are stunning developments, Joe Nocera writes in the New York Times, as is the fact Goldman Sachs and Morgan Stanley are the only big investment banks standing. But the turmoil isn’t simply the result of complex trading instruments gone awry, Nocera writes; “what’s going on is something we are all familiar with: denial.” More»

Paulson brokers twin public-private liquidity measures

(NEWSER) - Ten of the world's largest banks have formed a massive liquidity fund to mitigate the effects of the Lehman Brothers meltdown, reports the Financial Times. All the investment banks will be able to borrow up to a third of the $70 billion fund in order to reduce volatility and stay in business while Lehman is being wound down. They will also be able to borrow from the Fed under newly relaxed terms. More»

(NEWSER) - Barclay's dropping out of a Lehman deal means that the Feds lost a game of chicken with the big banks holding Lehman mortgages, and now there will be a disorderly liquidation of Lehman assets, instead of the orderly liquidation that would have been possible with a real buyer, James Cramer writes on TheStreet.com. The question is how big a hit those owning Lehman mortgages will take. More»

So far, 170,000 positions have been cut worldwide

(NEWSER) - Job cuts in the financial services sector could hit 350,000 worldwide by the middle of 2009, double the number so far, Bloomberg reports. "This is the financial equivalent of World War II," says the CEO of a major headhunting firm. If he's right, by summer, the industry will be 20% smaller than it was before Lehman Brothers and other investment banks started shedding jobs by the thousands. More»