September 2008

If the $85 bn lifeline the Federal Reserve tossed to American International Group, an extraordinary expansion of its powers, feels ad hoc to you, it should. Because it is. With the government's rescue of damaged financial behemoths, US taxpayers now own equity in AIG (AIG), Fannie Mae (FNM) and Freddie Mac (FRE). The Federal Reserve is now trying to unload $29 bn in rotten Bear Stearns assets ... read more

Meredith Whitney, a top analyst at Oppenheimer Equity Research, warns in a new report just out today that Citigroup (C), JPMorgan Chase (JPM) and Bank of America (BAC), along with numerous other banks are still understating the severity of the housing crisis, which could impact the values they are assigning their mortgage securities. Specifically, Whitney says the most important metric used ... read more

All eyes are on Goldman Sachs Group (GS), which beat the Street's estimates by ten cents a share with fiscal third quarter earnings of $1.81 a share.  Analysts had expected $1.71 a share. However, the profit drop was Goldman's worst year-to-year decline since going public in 1999, versus its track record of posting the best profit record on Wall Street in the last two fiscal years. Goldman ... read more

The world's biggest bankruptcy, Lehman Brothers (LEH), American International Group (AIG) asking the Federal Reserve for help, Bank of America (BAC) buying Merrill Lynch (MER), and the world markets selling off, with the US stock market desperately fighting to hold fast. It seems like the crisis gripping Wall Street should be a kitchen-sink event, one that has led to the most dramatic reshaping ... read more

An important story got buried under the avalanche of news about the fate of Lehman Brothers (LEH) today. A top housing expert just called the bottom of the housing crisis. He says, get this, we are nearing the bottom now. I am reprinting here in its entirety a piece by one of the best business journalists in the country, Justin Lahart of The Wall Street Journal. Read on: Wellesley College ... read more