After turning down a shot at buying all of Lehman Brothers over the weekend, British bank Barclays just picked up the core of the investment bank for $250 million. It spent another $1.5 billion to buy Lehman’s New York headquarters building and a couple of data centers. You read that right: the buildings went for six times more than the …
A money market fund–and not just any money market fund–breaks the buck
The Reserve, the company that invented money market funds, just announced that its $62 billion Primary Fund is going to break the buck–that is, be valued at less than the usual $1 a share. The reason: Lehman’s bankruptcy. To quote the Dow Jones newswire story:
New York money manager the Reserve said Tuesday that its Primary Fund is
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Prince Alwaleed: I own enough bank stock already, thank you
TIME’s Bobby Ghosh just chatted with Prince Alwaleed bin Talal today. Does the Prince, who made a fortune betting on troubled Citicorp in 1991 but lately has been seeing mostly losses on that investment, have any plans to ride to the rescue of the U.S. financial sector?
TIME: Would you buy now?
Alwaleed: No, I think we have enough
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Before B of A saved us, it laid the groundwork for our destruction
Perhaps I hyperbolize, but it’s still interesting to note—as esteemed business editor Bill Saporito just did to me and Justin—that B of A issued the first private mortgage-backed security. Bill was reading a paper about the resiliency of mortgage-backed securities when collateralized-debt-obligation markets are disrupted (timely!) …
Anatole Kaletsky says it’s all Hank Paulson’s fault. I’m dubious
Silly me, I thought it was a good thing that Hank Paulson insisted on more or less wiping out the shareholders of Fannie and Freddie. But now the estimable Anatole Kaletsky of The Times makes the counterargument:
By deciding essentially to wipe out shareholders in Fannie Mae and Freddie Mac and acting even more harshly to the
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What it means for you, Part I
That Q&A I mentioned yesterday is now on Time.com. I talk about what happens to your insurance policy at AIG if the company declares bankruptcy, what happens if your mortgage lender goes belly up, and other good stuff.
Barbara!
My attempt at kindergarten lunch
I’m exhausted. Post-maternity leave, we’re back to pbj and pickles.
AIG, Merrill, Lehman: If your company is tanking, is it riskier to stay or bail?
Yesterday was Keiro-no-hi in Japan, or Respect for the Elderly Day. It’s a national holiday, which means the press, too, gets a day off. The entire press corps of the entire country goes to the beach. With Obaachan and Ojiichan. It’s nice, isn’t it? Because it means that no matter what happens in the world, there is absolutely no news …
Why bailing out AIG might be a good bet
Australian money manager John Hempton offers the clearest explanation of AIG’s predicament that I’ve seen:
The core business – the US Domestic Broker Group (DBG) is the best diversified primary insurance company in the US. … There are other OK businesses in there.
The good businesses generate about 20 billion per year pre-tax. That
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