Bank Failure Friday 9/12/08 * Adios Lehman Brothers?

The FDIC homepage is off line. I HAVE NEVER NEVER SEEN THIS HAPPEN. NEVER.

WAHOR!!
http://www.dailypaul.com/node/48994

Did not want to wait in line and beg next week.

In order to be considered a bank it must fall under the jurisdiction of the FDIC.

Neither Lehman nor WaMu qualify under this definition.

WAHOR!!
http://www.dailypaul.com/node/48994

"Only a virtuous people are capable of freedom. As nations become corrupt and vicious, they have more need of masters." Benjamin Franklin
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Inflate Or Financial Tsunami by JayTaylor
http://www.gold-eagle.com/gold_digest_08/taylor090608.html

In the article, Jay Taylor wrote,

I can’t help remembering Bob Hoye’s constant refrain that when the global economy runs into trouble, the senior currency gets stronger. Why so? Bob reasons that debt is really a “dollar short” position. When the debt has to be repaid, everyone scrambles to sell assets and buy dollars to answer the call of margin clerks.

They always put the worst news out on Friday and there is a lot more coming.

Free and Brave
or Cradle to Grave
You can't have both

Asian Market Update: The latest on LEH, WM; News-driven stocks rally fizzles

- The Washington Post reports that the U.S. government is to arrange a sale of Lehman through a consortium of private firms, adding that the deal could be announced over the weekend. No government money is expected to be involved in any type of resolution, according to a Wall Street Journal report. Bank of America, Barclays and even GE have all been named as potential suitors. The news sparked a relief rally in Asian financials and risky currencies, but the sustainability of news-driven rallies has to be questioned after the FRE/FNM rally fizzled in less than 24hrs.

- Both Fitch and Moody's downgraded WaMu's credit rating, citing the bank's reduced financial flexibility, deteriorating asset quality, and expected franchise erosion. "Positively, Moody's does note that WaMu currently has limited exposure to short-term wholesale funding, and the Federal Home Loan Bank (FHLB) has been a stable source of funding for the bank throughout the credit crisis," wrote Moody's analysts. "However, the company is suffering from a lack of confidence in the debt markets, concentrating its liquidity resources in the FHLB." WaMu said it has no intention to suspend dividends on its preferred stock as a result of Moody's action. "We believe that Moody's decision to reduce the ratings of Washington Mutual, Inc. to below investment grade is inconsistent with the company's current financial condition, as outlined in the press release we issued earlier this afternoon," they said in a press release. "The action by Moody's appears to reflect the current uncertainty in the markets, rather than a thorough evaluation of Washington Mutual's business, the strength of its national franchise and the steps it is taking to return to profitability."

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"Those Who Strive For Excellence Refuse To Fear Mediocrity; They Eradicate It."

I've been shorting financials since Freddie and Fannie were having problems. The sad thing is the fed needs these to be destroyed. Let bad choices rot-out. But alas we need the fed to save us!