“The board of directors is going to be under pressure, it has to deliver a head to the street.”–Fuld’s own people (their net worth evaporating, were losing confidence and they were dealing directly with Paulson and the Feds and JPMorgan). JPMorgan is the originator and the largest holder of these valueless derivatives, they are the elephant in the room. Holder of the $300 Trillion Time Bomb… this $58 Trillion Elephant passed the hot potato to Lehman in the form of minute notice for refusal to cover positions unless they came up with some mo money.
“I’ve given you fourteen years of earnings. I have one bad quarter. This is how you respond?” said the Lamb.
3 months later Lehman Brothers filed for Bankruptcy.
How did Paulson put his Martha on Fuld? Easy, it was a confidence game. Fuld was such an easy target. He broke the Rule “never ask (or beg) for betrothal”; betrayal outside, looking in, took an easy swipe See Desperate Woman. See Paulson in legacy mode changes Lehman Story.
“That’s because relatively few banks bought into the promises of US mortgage-backed assets. Those that did had only limited exposure before last year’s subprime blowout: Asia currently accounts for only $24 billion of $550 billion in global subprime-related loan write-offs”
Why are Asian Banks stronger than U.S. Banks
“Beijing holds more than 60 percent of its $2 trillion of reserves in dollar assets, with a big chunk in debt issued by the Treasury and troubled mortgage lenders Fannie Mae and Freddie Mac, which have effectively been taken over by the government.”–Chinese, U.S. pledge cooperation