Lehman posts $2.8 billion loss
Arivaderche, sayonara, adios, asta la vista, stick a fork in them. It's over baby. The fat lady is singing and she's sitting in front of an all you can eat buffet. Atleast they'll go out with a bang.
Lehman posted it's first losing quarter (yes QUARTER) ever, but boy was it a doozie. More than $5 per share in losses is quite a turnaround from profitability. This company will be lucky to be in existence within the next 6 months. It's guaranteed they are toast by 2010. The most likely outcome is they prop themselves up like Weekend at Bernies until they can manage a firesale to another sinking ship. Worst case scenario is we see another Bear Sterns attack on their liquidity forcing another "bailout". That would happen within 6 months if it does, maybe sooner.
How a company can buy back their own shares at the end of last week and then turnaround with 5 days and go cap and hand to the public with another offering is beyond me. That is plain and simple balance sheet suicide. Historians will note the similarities betwen this move and what financial institutions did during the Great Depression. It wasn't uncommon for banks to buy back their own shares to prop up share value. This was praised initially until people realized it was harikari by slower means. Not a good sign then and certainly not a good sign now. Companies are pulling out the same playbook as in 1929 and it didn't work then.
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