OMG what a day. The carnage was amazing - look at the LEH volume 260% of normal daily volume. At this rate the LEH mid-year bonus will see staff own all of LEH. Shit next staff salary will be simply be in stock bought daily from salary budget. As for FNM and FRE they are dust - FRE down 22% today alone. THEY ARE BOTH INSOLVENT/BANKRUPT AS THEIR LIABILITIES EXCEED ASSETS(CAPITAL). If the US government steps in to guarantee them the US WILL BE DOWNGRADED. T-BONDS will be dumped in mass. US i-rates will head up.
For the last few months, LEH always down big one week before OE, this time is no exception, it will come back on OE week.
LEHMAN BOTHERS NEW RUMOR DRAWS FRESH BLOOD FROM STREET STALWART By MARK DeCAMBRE Lehman Brothers CEO Dick Fuld yesterday found himself taking a thrill ride he'd just as soon have avoided, as fresh rumors about the firm's future sent the company's stock reeling. Shares plunged as much as 23 percent in early trading, falling to their lowest level in eight years, amid rumors the giant bond manager Pacific Investment Management and the $16 billion hedge fund SAC Capital were pulling business from the firm. If true, the news could have rung the death knell for the 158-year-old company. Both firms publicly denied the talk, and the stock pared its losses but still ended down 12 percent, or $2.44, to $17.30 in New York Stock Exchange trading. The punishing plunge was reminiscent of the precipitous decline of now-defunct Bear Stearns. OptionMonster co-founder Jon Najarian said early-morning activity in securities used to bet that a stock will fall - known as puts - told the story. About 90,000 puts changed hands in the first hour of trading. That compares with the 30-day full-day average volume of 173,000. Najarian told The Post that by midday about 164,000 puts had traded, and were almost evenly divided between investors taking on fresh bets Lehman shares might further tank and those unwinding their short positions. He noted that such activity suggested someone was benefiting big from the rumors by exiting a big chunk of their short positions. More telling is that only another 10,000 puts were traded throughout the day, Najarian said. Sources pointed fingers specifically at one well-known hedge fund as the originator of the rumor, but that role could not be confirmed. "These hedge fund guys are like Sir Laurence Olivier's [demented dentist character] in 'Marathon Man,' " Najarian said. "Once they find a nerve they just keep hitting it until it dies." mark.decambre@nypost.com