World Markets Tumble On Wall Street Crisis

Lehman Brothers Bankruptcy Prompts Huge Cash Infusion By EU, UK Central Banks

(AP)  World stock markets turned sharply lower Monday after a double-fisted blow from Wall Street - news that Lehman Brothers had filed for bankruptcy and Merrill Lynch would be sold to Bank of America.

In Europe, the FTSE-100 share index closed down 3.9 percent in London, the Paris CAC-40 was off 3.7 percent and Germany's DAX 30 index of blue chips sagged 2.7 percent.

In the U.S., the Dow Jones industrial average fell 504.48 points, or 4.42 percent - their worst point drop since the Sept. 11 attacks - in New York trading.

Broader stock indicators also fell. The Standard & Poor's 500 index declined 58.74, or 4.69 percent, to 1,192.96, and the Nasdaq composite index fell 81.36, or 3.60 percent, to 2,179.91.

In Russia, where stocks were already suffering from falling oil prices and worries about political interference in business, the MICEX index was down 6.2 percent and RTS index was 4.8 percent lower.

The falls were led by insurance and financial stocks, with shares in French insurer AXA SA down 8.5 percent, Germany's Commerzbank AG falling 9 percent, and Britain's HBOS 17.55 percent lower.

"In the short term, we are looking at a fresh wave of weakness hitting financial markets," said Chloe Magnier, chief economist at Saxo Bank in Paris. "I'm not optimistic about the coming months."

Bond prices surged as investors fled to the security of government debt. The yield on the benchmark 10-year Treasury note, which moves opposite its price, plunged to 3.54 percent from 3.72 percent late Friday. The dollar was lower against other major currencies, while gold prices rose.

Europe's major central banks moved quickly to calm markets Monday, pumping billions of euros and pounds into the financial system. The European Central Bank loaned euro30 billion but said it received 51 bids for euro90.3 billion (US$127 billion) on its one-day tender with a bid rate of 4.25 percent - a clear sign that demand for cash is over the top.

Similarly, the Bank of England offered up 5 billion pounds (nearly US$9 billion, euro6.4 billion) in a three-day auction - but bids were nearly five times higher, at 24.1 billion pounds. (euro30.4 billion; US$43 billion)

The 158-year-old Lehman Brothers Holdings Inc. filed Monday for Chapter 11 bankruptcy. The company was crippled by US$60 billion (euro43 billion) in soured real-estate holdings and unable to find an investment partner to throw it a lifeline.

Officials from the government and various banks failed to find a solution during weekend meetings. During the talks, when Bank of America balked at buying Lehman, the government urged it to buy investment bank Merrill Lynch instead.

The US$50 billion (euro36 billion) deal may stop speculators whose next target after Lehman would have been Merrill, according to Stephen Pope, chief global market strategist at Cantor Fitzgerald Europe in London.

The moves will create a "firebreak in the financial structure," and once disappointment that Lehman didn't manage to make a deal has been digested, stocks will start to recover, he said.

"You are going to have a torrid day today, probably tomorrow as well, but then I think people are going to start thinking there's some opportunity out there to be engaged," he said.

Before that, markets also have to react to a possible restructuring of the world's largest insurance company, American International Group Inc. AIG's troubles a week after its stock dropped 45 percent are perhaps most worrisome for some investors because of the company's enormous balance sheet - and the risks that its troubles could spill over to its customers.

Light, sweet crude for October delivery fell US$3.57, or 3.53 percent, to US$97.61 a barrel on the New York Mercantile Exchange, after earlier dropping to US$94.13, the lowest level since Feb. 14.

Asia's biggest stock exchanges in Japan, Hong Kong and South Korea were closed for holidays, but every market open closed deep in the red.

India's Sensex tumbled 3.4 percent, Taiwan's benchmark plummeted 4.1 percent and Singapore dropped 3.2 percent.

In Latin American markets also plunged, with Brazil and Argentina falling the hardest, with 6.2 percent and 3.28 percent drops. In Mexico, the market slipped 1.94 percent, while in Chile stocks were down 0.8 percent.

[emelder]

These desperate weekend meetings to save our economy from ruin have GOT to be a wake-up call to any McSame/Barbie supporters who still think our economy is doing OK!!! Voting for REAL change by electing Obama/Biden is our only reasonable option for America. Let''s really get behind them, people, by electing them and by giving Congress all the democrats they need to get this country back on a positive course again.

[rhess45]

Tell me again how that Bush/McCain plan to privatize Social Security works again? Wasn''t our money supposed to be going into ''safe investments'' like the stock market, rather than into some big, bad ol'' guvmint program? And who''s interests are Bush/McCain looking out for? Just some questions.

[skyk239]

These desperate weekend meetings to save our economy from ruin have GOT to be a wake-up call to any McSame/Barbie supporters who still think our economy is doing OK!!! Voting for REAL change by electing Obama/Biden is our only reasonable option for America. Let''''s really get behind them, people, by electing them and by giving Congress all the democrats they need to get this country back on a positive course again.

Posted by emelder at 07:43 AM : Sep 15, 2008

I agree we''ve got to all come together on this and show the World a united front. I can only hope that, yet again, the Democrats can save us from our own stupidity and greed.

[swwils]

the whole country is collapsing,and these executives will slide out of this one with millions again!

[swwils]

Voting for Obama will not bring change you stupid brainwashed pigs!Big money runs this world not two people.They will either do as they are told when/if elected or another JFK syndrom will happen.Billionaires and trillion dollar corporations run this planet if none of you understand that then you are blind as a bat!

[tootall10142]

Until this country gets brought to its knees.republican and democrats unite together for a better future it will and can get worse.Until the common wealth get cornered and say enough is enough. The greedy little speculators will continue to rock the financial cradle.what gaineth a man if he inherit the earth but losses his soul?what gaineth a country if the drones quit work hide thier money ,steal from thier neighbor,hord thier knowledge and teach thier children to hate and not to listen to anyone outside the family.Wait a second thats happening now.i dont have a film for you just history books as referals.

[whitemale08]

Voting for Obama will not bring change you stupid brainwashed pigs!Big money runs this world not two people.They will either do as they are told when/if elected or another JFK syndrom will happen.Billionaires and trillion dollar corporations run this planet if none of you understand that then you are blind as a bat!


--------------------------------------------------------------------------------

Posted by swwils at 08:11 AM : Sep 15, 2008--

You might be right about that but at least Obama and the Democrats will keep vital social programs running.

John McCain and the Republicans believe in Fascist "you''re on own" type of politics and we will literaly be left for dead because of the so-called "free markets".

We are doomed, I''ve said it before over and over again but in times like this it''s better to have a so-called "socialist" President otherwise we are left to defend for ourselves!

[brianbwb-2009]

It never ceases to amaze me that even after the Chrysler bailout, the airlines bailouts, Enron, Worldcom, Countrywide, Qwest, 117 other Banks, savings and loan companies, and a few hundred other examples, how anyone would still trust their life savings, or even their spare change to Wall St.,

After all these years of corporate sleaze collapsing on them, anyone who still has money in that corrupt place deserves to lose every penny they end up losing.

It is now time to ignore Wall St., let it fall, then kick the carcass to the gutter. After all it was the neocon capitalists that created the urban jungle law, which everyone except themselves is supposed to be subject to, so now let us return the "kindness" and "compassionate conservatism" they have shown their fellow man, eff ''em.

[ajaxtheleast]

"TO BE,,
fixed in time to get McCain elected

OR NOT TO BE,,
fixed in time to get McCain elected."

THAT IS THE QUESTION.


And their struggle to find the ANSWER

is limited ONLY to the question.

[sumarongi1]

We should chuck all the speculators out of their 49th floor windows and then start hanging all the middle-men who cost us billions in "handling fees". More commonly known as fleecing the public.

[skyk239]

Voting for Obama will not bring change you stupid brainwashed pigs!Big money runs this world not two people.They will either do as they are told when/if elected or another JFK syndrom will happen.Billionaires and trillion dollar corporations run this planet if none of you understand that then you are blind as a bat!

Posted by swwils at 08:11 AM : Sep 15, 2008

So voting FOR someone who owns what is it SEVEN Homes and has as a financial adviser the guy who took all the regulations and restrictions off the lending industry is the way to go. No thanks. I''m going with Obama. I''m tired of all the arrogance and lies of the Republican''s.

[sumarongi1]

You all insist on clinging to the myth of the American political as a multi-party system. May as well call them Demopublicans! Until we force strict term limits, a ban on special interest lobbying, and election finance reform the good ole boys and the lobbyists will continue to run this country to their benefit, not ours.

[abbe91]

"So voting FOR someone who owns what is it SEVEN Homes and has as a financial adviser the guy who took all the regulations and restrictions off the lending industry is the way to go. No thanks. I''''m going with Obama. I''''m tired of all the arrogance and lies of the Republican''''s.

Posted by skyk239 at 08:40 AM : Sep 15, 2008"

Looks like we will need again a democrat to clean up
Republican mess. Nothing new since FDR.

[sumarongi1]

FEMA gets a fund to provide roofing repairs in Louisiana passed by Congress to the tune of $140,000,000.00. It then passes through the hands of a company in Atlanta,GA that is owned by friend and/or fraternity brother, who will gladly pass it on to another member of the network. Oh, each time this contract is passed through one of these clowns hands, a consulting or referral fee of several millions of dollars occurs. By the time the final contract was awarded to a connected firm in Mississippi, for actual implementation of the repairs, over 60 million dollars have managed to find their way into the hands of people whose sole contribution to the project consisted of passing it on to another compatriot so he can get his share of the pie. Business as usual in America.

[magoo2u1]

Pleas ! Please ! Please ! Vote Republican in Nov. Can''t you see the plan starting to work? If you will just have faith the trickle down effect Reagan promised will start soon. Don''t give up just when the payoff is around the corner. Communists will tell you we need regulations, rules- interference. Let the market run things and corporations will always do what is best for the poor and the little guy. Do you really think we need rule from the Govnmt to work safe with asbestos or coal mines ?
Soon we will have traffic lights and stop signs removed- SCREW REGULATION. Viva la freedom!!!!!!!!!

[tscc2]

Our only hope to get out of this mess is through the economic brilliance of George Bush and the Republicans. Ya right! That Republicans are better for the economy is a myth. Anybody that votes republican during this economic meltdown needs an economics 101 course or a shrink. Russia is doing a lot better job with their economy than we are. Americans live above their means because they buy into our capitalist culture. The banks push credit like crack dealers and corporations spend 100''s of billions in marketing manipulation of products and lifestyles that are beyond the means of most Americans. Our capitalist culture is more to blame than the individual. This problem goes back to Greece and was talked about by Greek philosophers. Here we are 3000 years later and no progress.

[magoo2u1]

""I''m as much in the dark as you but I can''t talk to you. We''ve been told not to talk," said another worker, who refused to give his name."

Now there is a plan that will work. Ignorance is bliss. Shut up and everything will go away. It''s worked for Bush. VOTE REPUBLICAN and save us from the mess the socialist commie democrats have gotten ue into !!!!!!!!!!!!!!!!!!!!1111

[cbk16]

Looks like the economy does not like the Democrats to control congress, the economy was doing fine until the Democrats took over.

[abbe91]

"Looks like the economy does not like the Democrats to control congress, the economy was doing fine until the Democrats took over.

Posted by cbk16 at 09:53 AM : Sep 15, 2008"

Maybe the economy doesn''t like Bush vetoes ...
Your joke was pretty good. Thanks.

[legacyabq]

Looks like the economy does not like the Democrats to control congress, the economy was doing fine until the Democrats took over- posted cbk16
LMFAO- You are really dum you know? This has been shaping up for a decade, during the real estate bubble.. The repubs were in charge at that time. Corruption from Bush/Cheney right on down. These boys figured the repub exec. branch would bail em out.. Worldcom? MCI? Enron?? Now, we have defaulting mortages made in high-profit-on-the-short-term home loans, made with profit in mind: not solvency.. yet you blame the democrats?? Why should ignorant fools like you get to vote? You are part of the problem in the long run.. Thanks alot for doing your part to bury your head in the sand and ruin my beloved country..

[thevicar1]

Maybe the economy doesnt like Bush vetoes ... ---------------------------------------- Posted by abbe91



Im pretty sure the economy doesnt like Barrack Obama running for President

[rockpeterson]

You can''t make any money whatsoever in the stock market these days. There are too many people in finance who don''t know what they are doing. They give out loans to home buyers who can''t possibly pay them back. What a joke!!!

[ncvoter2]

all i have to say is "what goes around, comes around." screw ''em.

[hotpaulie]

legacyABQ - I agree with you 100%!!!

[marshall65]

Bush''s answer for the economic slowdown 2001-2002 was to go out and spend. With what? Max''d out credit cards? Houses got bigger, mortgages swelled but a big chunk of the population jumped on the spending bandwagon. The credit purse strings loosened, rules dropped by the wayside and anyone with a sense of frugality could see the whole ship slipping into the drink. ''There''s nothing wrong with a deficit'' said one of our enlightened leaders. Really? Now we have to dig our way out and hope that once all of the bubbles have burst, we''ll return to some semblance of economic sanity. Back to Bush''s buy buy buy philosophy, when it gets down to brass tacks, the decisions that got us to this point are ours. Bush and Congress, whoever controlled it can not be held accountable for our own foolish mistakes.

[jab232]

The CEO of Lehman got a 20 million dollar bonus in 2007. What happened to your wages and 401K''s? Folks, we''re being took. John McCain said just this morning (September 15) that the fundamentals of the economy are sound. And they are sound for the rich like John McCain. But what about for the rest of us? McCain-Palin is just Bush-Cheney warmed over except that Cheney is more qualified to become president if he has to.

[petro49l]

U.S. Oil Companies must lose the Saudis. Central and South America is the place. The Dow needs cheap fuel to run the American economy. Why become embroiled in George W. Bush''s little war?

[tpraskac]

What goes around comes around you GREEDY ***

[antoniof123]

"Looks like the economy does not like the Democrats to control congress, the economy was doing fine until the Democrats took over.

Posted by cbk16 at 09:53 AM : Sep 15, 2008"

This is by far the dumbest thing I read in a while. This is the product of 12 years of GOP controled or should I say lack of control congress. They let the administration get away with anything it wanted and now we the American people have to pay the price.

Want to bet what Carl Rove said about McCain comes to haunt him. I think his exact words were he went over the top "on mudslinging mine" but the end results is the same the American people have had enough of swift boating.

The GOP legacy Swiftboating will go down in history.

[tpraskac]

Need to start over from Day 1. Screw it all.

[tpraskac]

IF BUSH WAS ON THE TITANIC HE WOULD HAVE SAID: NO NEED TO WORRY,THE SHIP WILL CORRECT ITSELF

[cruzn66]

Gee, the concept of smaller government, meaning less oversight of Big Business, doesn''t seem like its working out so well! Go figure, Greed only knows how to limit its oversight, not how to control itself for the common good. I hope all of those in favor of smaller government are happy with the results. It doesn''t matter what amount of taxes you pay when you don''t have a job or property to worry about. I guess the ultimate answer is that all the fat cats who don''t want to pay their fair share in taxes will donate the extra money to all of us who are hurting economically for their benefit!

[lochlan-2009]

"Lehman Brothers Bankruptcy Prompts Huge Cash Infusion By EU, UK Central Banks"

Well, this will devalue their currency at the expense of a gain in ours.

Does anyone on these sights have any intellect at all? I don''t hear a single person pointing out how rigged and manipulated these markets are for the rich, and the profit zones created by multiple governments for them, so to easily cash in at the cost of Joe Smith (now being called Main St.). The government switch the rules to the new game the corporations want to play, and the media scare the masses in the desired direction for the profit of the oligarchy.

So it turns out speculation WAS the cause for huge inflation in energy prices this last year, and the car companies took it on the chin. No law suits, no compensation, just big losses to allow their stock to be cheap. What do you think is coming the auto companies way these next 8 years?

Americans really are ignorant.

[cruzn66]

What''s coming???? More corporate bailouts at Taxpayer expense, but, hey, what can a good Republican do but bail out a friend in need!!!

[bobnjersey]

[People leave the Lehman Brothers headquarters on 7th Ave. in New York City carrying personal belongings as they clear their offices, Sept. 14, 2008 after hearing the news that Lehman Brothers may be forced to seek an orderly unwinding of its businesses.]

which is one of many bellwethers of the unwinding of our economy ... and not likely to be all that orderly.

but phil graham says it''s a ''mental recession'' ... so there''s really no need to worry ... just imagine it all being fine.

[thevicar1]

Happens everytime a republican steals the oval office only because they skipped math class in school ---------------------------------------- Posted by rharrin1


Can you be so sure that Barry Obama got any math during all those years of Islamic Studies in Indonesia???

[thevicar1]

Do you know who spearheaded the law
changes that let them join the game?
Hint - his name is Phil Gramm - A REPUBLICAN!! While
you have the right to be an IDIOT, you have NO obligation to exercise this right -------------------------------------------------- Posted by cbs3200


I like it when people resort to insults and name calling in order to make a point. It gets the question of their IQ out of the way right from the start.

[lochlan-2009]

I like it when people resort to insults and name calling in order to make a point. It gets the question of their IQ out of the way right from the start.

Posted by TheVicar1


I see your point, with your insult and name calling on peoples IQ. Don''t be so hard on yourself, though.

[bobnjersey]

[VOTE REPUBLICAN and save us from the mess the socialist commie democrats have gotten ue into !!!!!!!!!!!!!!!!!!!!1111]
[Posted by magoo2u1 at 09:50 AM : Sep 15, 2008]

the ignorance is staggering ... but this is mr. magoo ... maybe he just needs to clean his glasses.

[bobnjersey]

[I like it when people resort to insults and name calling in order to make a point. It gets the question of their IQ out of the way right from the start.]
[Posted by TheVicar1 at 01:08 PM : Sep 15, 2008]

or they''re just trying to find the appropriate level they need to be at in order to communicate their view.

[jmurrieta11]

"In an interview with Bloomberg Television Friday, Greenspan said the nation could not afford 3.3 trillion dollars of tax cuts proposed by McCain without matching cuts in spending.

Greenspan, a long-time friend of McCain and a Republican, said about the Arizona senator''s plans to extend massive tax cuts imposed by President George W. Bush: "I''m not in favor of financing tax cuts with borrowed money."

[mydiatribe]

jMcGilvray
Your own prejudice against religious believers is quite apparent in your post.
I submit to you perhaps if some of those SECULARIST financial geniuses had acquired and lived by the rudiments of the ETHICAL values you scoff at, we wouldn''t now be facing this CRISIS!

[stevex47]

"with barry obama;s wild spending of campaign money, we can''''t afford to put him in office."

Ya, that proves it, the republicans really know how to be fiscally responsible, ya, riiight.

Oh by the way, did you know Cindy mcsame wore $300,000.00 worth of clothes the nite of the RNC?

[stevex47]

Hey, um, nutjobs...stop trying to ruin the United States okay?

[hungry1968]

with barry obama;s wild spending of campaign money, we can''''t afford to put him in office.

Posted by funzie50 at 02:27 PM : Sep 15, 2008





He HAS the money up front, and then spends it.

Unlike McCain that promises to keep borrowing HUNDREDS OF BILLIONS of dollars from China, so that we have to pay back the principal AND the interest, which ultimately costs more than double than having the money up front!

[hungry1968]

jMcGilvray
Your own prejudice against religious believers is quite apparent in your post.
I submit to you perhaps if some of those SECULARIST financial geniuses had acquired and lived by the rudiments of the ETHICAL values you scoff at, we wouldn''''t now be facing this CRISIS!

Posted by mydiatribe at 02:48 PM : Sep 15, 2008





This is the most absurd post, I think that I''ve EVER seen.

Because their companies failed and are going bankrupt, according to you, their leaders are all secularists?!?!?

Where in the F*** did you dream that garbage up from?!?!

[mytoosense]

pretty sure the economy doesnt like Barrack Obama running for President
Posted by TheVicar1

Vicar1, your religious right robes are showing.

[dredre2k]

For the last 8 years, Wall St. has been the cause of the big NIGHTMARE for the middle class. High gas, crooked mortgages, slumping dollar, inflation...

Republicans have been boozing Wall st. up, and now its boozed over and out of control!

[skyk239]

Where in the F*** did you dream that garbage up from?!?!

Posted by hungry1968 at 03:02 PM : Sep 15, 2008

It''s called desperation!! They had a plan you know. Get the Old Man elected, Pray for him to kick off and THEY with the wicked Witch of the North in charge, would control the whole country. This REALLY makes that highly unlikely!!

[brianbwb-2009]

"Merrill Lynch, bullish(it) on America.

Put your money with the Bulls, and act surprised that bulls also excrete?