Lehman Brothers filed for Chapter 11 bankruptcy this morning, leading to a sharp drop in stock markets all around the world.
Asia tumbled first on the news Monday, followed by the Middle East, Russia and then Europe before the shockwave hit the North and South American markets.
“The collapse of Lehman Brothers has sent a major jolt through global financial markets as it is by far the biggest victim of the credit crisis that started in August 2007 and had been considered too big to fail,” said Global Insight economist Howard Archer.
“There is obviously widespread concern about other banks’ exposure to Lehman Brothers, not only in the US but also in Europe. Lehman’s collapse also increases concerns that other banks could fail.”
At the same time, the dollar fell heavily against the euro before recovering some lost ground in volatile trade while oil prices slumped to seven-month lows under 93 dollars on fears the crisis will slow growth and curb energy demand.
On Wall Street, stocks were down 2.72 percent at around 1600 GMT.
“Everything else is pushed aside as the stock market attempts to figure out what the sale of Merrill and bankruptcy of Lehman will do to both the stock market and the economy,” said Al Goldman at Wachovia Securities.
Think on the bright side, single women of New York City: Now all Lehman’s investment bankers will FINALLY have time to go to the clubs and hit on you. Ahhhhhhh ha ha ha ha ha ha!
GO AMERICA!
Haha should I take my money out of the bank before it’s too late?
I have a friend who doesn’t trusts banks so he keeps thousands of dollars in his room.
I’m thinking of all those self-absorbed investment bankers I was dating when I lived in the city and how they are each being brought down to earth. It gives me a little feeling of warmth inside.
The only down side for the NYC girls is that they’ll have to buy all their own drinks!
And what is with B of A buying Merrill Lynch like some casual multi-billion dollar shopping spree. Will they just throw it on top of the pile with Countrywide? What is going on here?
The only problem with the “Chickens coming home to roost” aspect of the economic disaster that is currently befalling both Wall Street and “Main Street”, is that the same arrogant, greedy, self-serving bastards who have caused these problems (bringing pain and suffering to the average, hard working American) will, no doubt, find a way to land on their feet and make off with a pile of ill-gotten money.
And this is why American politics matters to those outside the US. Unaffordable housing for everyone, courtesy of the Republican Party. America had a budget surplus before Bush got in.
re: abbi
and your friend lives where?
censorthis:
Find me when you figure out where Abbi’s friend lives and we can both pay a visit.
omg, censorthis- i was totally going to ask that too!!