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Lehman's Fuld Testifies
- Thread starter bit
- Start date
I would enjoy seeing Fuld BBQ'd.
I admit it.
Does that make me naive, jealous, wrong, misplaced in my anger (a combination of or all of the above)?
I admit it.
Does that make me naive, jealous, wrong, misplaced in my anger (a combination of or all of the above)?
Quote from nutmeg:
Lying to the investing public is fraud. Do you suppose Fuld lied to his investors to the extent of fraud?
Actually, has he said anything that was a lie which propped up the share price?
They keep very detailed records. Up to now, nobody has requested any of them. We showed you the SEC was sitting on mob related money laudering stuff, until someone got discovery. They would have let them sit six years, and then , bye bye.
The difference is motivation.
Some of his testimony (think we're serious about this?). Before you go bullshit bashing me, remember, this is under oath to Congress. The downside to lying is about to be felt by the Dir of Enf and some other SEC staffers.
The second issue I want to discuss is naked short selling, which I believe
contributed to both the collapse of Bear Stearns and Lehman Brothers. Short selling by
itself can be employed as a legitimate hedge against risk. Naked short selling, on the
other hand, is an invitation to market manipulation. Naked short selling is the practice of
selling shares short without first borrowing or arranging to borrow those shares in time to
make delivery to the buyer within the settlement period â in essence, selling something
you do not own and might not ultimately deliver to the buyer.
Naked short selling, followed by false rumors, dealt a critical, if not fatal
blow to Bear Stearns. Many knowledgeable participants in our financial markets are
convinced that naked short sellers spread rumors and false information regarding the
liquidity of Bear Stearns, and simultaneously pulled business or encouraged others to pull
business from Bear Stearns, creating an atmosphere of fear which then led to a self-fulfilling
prophecy of a run on the bank. The naked shorts and rumor mongers succeeded
in bringing down Bear Stearns. And I believe that unsubstantiated rumors in the
marketplace caused significant harm to Lehman Brothers. In our case, false rumors were
so rampant for so long that major institutions issued public statements denying the
rumors.
Following the Bear Stearns run on the bank, we and many others called on
regulators to immediately clamp down on naked short selling. The SEC issued a
temporary order that went into effect on July 21 prohibiting ânakedâ short selling of
certain financial firms, including Lehman, Merrill Lynch, Fannie Mae and Freddie Mac.
This measure stabilized the share prices of Lehman Brothers and the other firms.
However, this restriction was temporary, and on August 13 it expired after 17 trading
days. History has already shown how wrong and ill-advised it is to allow naked short
selling.
Many of the firms that have recently collapsed or have been forced into
emergency mergers, takeovers, or government bailouts â Bear Stearns, Lehman Brothers,
Merrill Lynch, Fannie Mae, Freddie Mac, AIG â did so during the gaps of time in which
there was no meaningful regulation of naked short selling. On September 15, when the
market opened after the collapse of Lehman, naked shorts appeared to turn their attention
to Morgan Stanley and Goldman Sachs. In the three days between the announcement of
Lehman Brothersâ bankruptcy and the SEC instituting an emergency ban on short selling,
Goldman Sachsâ and Morgan Stanleyâs share prices fell 30% and 39% respectively.
None of this was a coincidence.
After seeing this stock price reaction in the week following Lehman
Brothersâ bankruptcy, the SEC, like the Federal Reserve, took immediate action to
stabilize the system. On September 18, following the decision of the Financial Services
Authority in the United Kingdom a day earlier, the SEC instituted an emergency ban and
other restrictions on short selling financial institutions. In taking these steps, Chairman
Cox explained: âGiven the importance of confidence in our financial markets as a whole,
we have become concerned about the sudden and unexplained declines in the prices of
securities. Such price declines can give rise to questions about the underlying financial
condition of an issuer, which in turn can create a crisis of confidence without a
fundamental underlying basis. The crisis of confidence can impair the liquidity and
ultimate viability of an issuer, with potentially broad market consequences.â These new
restrictions are set to expire no later than October 17. Permanent regulation of naked
short selling is needed to prevent a similar demise for the firms that survived with the
governmentâs help.
The second issue I want to discuss is naked short selling, which I believe
contributed to both the collapse of Bear Stearns and Lehman Brothers. Short selling by
itself can be employed as a legitimate hedge against risk. Naked short selling, on the
other hand, is an invitation to market manipulation. Naked short selling is the practice of
selling shares short without first borrowing or arranging to borrow those shares in time to
make delivery to the buyer within the settlement period â in essence, selling something
you do not own and might not ultimately deliver to the buyer.
Naked short selling, followed by false rumors, dealt a critical, if not fatal
blow to Bear Stearns. Many knowledgeable participants in our financial markets are
convinced that naked short sellers spread rumors and false information regarding the
liquidity of Bear Stearns, and simultaneously pulled business or encouraged others to pull
business from Bear Stearns, creating an atmosphere of fear which then led to a self-fulfilling
prophecy of a run on the bank. The naked shorts and rumor mongers succeeded
in bringing down Bear Stearns. And I believe that unsubstantiated rumors in the
marketplace caused significant harm to Lehman Brothers. In our case, false rumors were
so rampant for so long that major institutions issued public statements denying the
rumors.
Following the Bear Stearns run on the bank, we and many others called on
regulators to immediately clamp down on naked short selling. The SEC issued a
temporary order that went into effect on July 21 prohibiting ânakedâ short selling of
certain financial firms, including Lehman, Merrill Lynch, Fannie Mae and Freddie Mac.
This measure stabilized the share prices of Lehman Brothers and the other firms.
However, this restriction was temporary, and on August 13 it expired after 17 trading
days. History has already shown how wrong and ill-advised it is to allow naked short
selling.
Many of the firms that have recently collapsed or have been forced into
emergency mergers, takeovers, or government bailouts â Bear Stearns, Lehman Brothers,
Merrill Lynch, Fannie Mae, Freddie Mac, AIG â did so during the gaps of time in which
there was no meaningful regulation of naked short selling. On September 15, when the
market opened after the collapse of Lehman, naked shorts appeared to turn their attention
to Morgan Stanley and Goldman Sachs. In the three days between the announcement of
Lehman Brothersâ bankruptcy and the SEC instituting an emergency ban on short selling,
Goldman Sachsâ and Morgan Stanleyâs share prices fell 30% and 39% respectively.
None of this was a coincidence.
After seeing this stock price reaction in the week following Lehman
Brothersâ bankruptcy, the SEC, like the Federal Reserve, took immediate action to
stabilize the system. On September 18, following the decision of the Financial Services
Authority in the United Kingdom a day earlier, the SEC instituted an emergency ban and
other restrictions on short selling financial institutions. In taking these steps, Chairman
Cox explained: âGiven the importance of confidence in our financial markets as a whole,
we have become concerned about the sudden and unexplained declines in the prices of
securities. Such price declines can give rise to questions about the underlying financial
condition of an issuer, which in turn can create a crisis of confidence without a
fundamental underlying basis. The crisis of confidence can impair the liquidity and
ultimate viability of an issuer, with potentially broad market consequences.â These new
restrictions are set to expire no later than October 17. Permanent regulation of naked
short selling is needed to prevent a similar demise for the firms that survived with the
governmentâs help.
"Al Goreâs carbon trading business GIM was banked with Lehman Bros. It will be interesting to see how this will play in the future but I suspect that this increases the risk of participating in Carbon trading. Merrill Lynch was also deeply involved in this business.
Last year Lehman Brothers released a long and highly publicized report about climate change in which they preached about decarbonization, trying to make their investors keep getting high profits from the Kyoto carbon trade scheme and the support of huge public subventions. All that, of course, with the applause of the usual choir of politicians, the entire media and the Greens.
A year ago they couldnât predict their bankruptcy but were predicting the climate 100 years ahead. Thousands of green militants have been using the Lehman report as a proof of global warming and impending chaos. Lehman Bros said it! sacred words! Its scientific advisor is James Hansen! The report is the basis for policies on climate change in Spain, Argentina and several other countries playing the progress game; it is used by economy professors playing the climatologists; by newspapers editorials, and even by a State Secretary: Lehman Bros, said it!
Lehman Brothers spoke in his report about the climate in 2100 and its economic and financial projections, about climate change costs several decades away. They dared to recommend their investors what they considered a central value of the carbon ton in 50 years from now. Their sources and support references were taken from the IPCC AR4, AR3, and so on. Really impressive.
But even with their high ability to peek into the future, they couldnât predict their demise one year ahead though there were many people that had been warning about this present crash for years. But Lehman Bros were recommending investments 30, 50, 100 years ahead. Some days, reality imitates fiction. Who was Lehman Brosâ âscientificâ adviser on climate? You guessed it, James Hansen, the same guy that wants to drive the world to bankruptcy as he did with Lehmanâs Bros.
But the story has some connections with Hansen being the âscientificâ adviser to Al Gore, whoâs the Chairman of the Board of the Alliance for Climate Protection. As seen in Allianceâs website, the managing Director is none less than: Theodore Roosevelt IV. Managing Director, Lehman Brothers, Chair of the Pew Center for Global Climate Change.
Theodore Roosevelt IV is Managing Director at Lehman Brothers and a member of the Firmâs senior client coverage group, which oversees the Firms client and customer relationships. Mr. Roosevelt is an active conservationist. He is Chair of the Pew Center for Global Climate Change, Vice Chair of the Wilderness Society, and a Trustee for the American Museum of Natural History, The World Resources Institute, the Institute for Environment and Natural Resources at the University of Wyoming, and a Trustee of Trout Unlimited.
The Lehman reports in two parts can be found on this site âIntellectual Capitalâ. In âThe Business of Climate Change llâ, the following acknowledgement is made: âOn the scientific side, we are grateful to Dr. James Hansen, Director of the NASA Goddard Institute for Space Studies, who, at the end of a particularly informative dinner hosted by Ben Cotton of the Man Group, gave generously of his time to clear up a number of scientific questions that had been niggling us. Dr. Peter Collins and Richard Heap of the Royal Society provided valuable input and brought us up to date on the more controversial areas of scientific developments in the domain of global climate change.â H/T Eduardo Ferreyra originally posted to Climate Sceptics Internet discussion group.
Lehmanâs failure provides a preview of our future if more companies bank their future on the speculative advice of these advocacy scientists, politicians and environmental groups, while ignoring short term realities."
Last year Lehman Brothers released a long and highly publicized report about climate change in which they preached about decarbonization, trying to make their investors keep getting high profits from the Kyoto carbon trade scheme and the support of huge public subventions. All that, of course, with the applause of the usual choir of politicians, the entire media and the Greens.
A year ago they couldnât predict their bankruptcy but were predicting the climate 100 years ahead. Thousands of green militants have been using the Lehman report as a proof of global warming and impending chaos. Lehman Bros said it! sacred words! Its scientific advisor is James Hansen! The report is the basis for policies on climate change in Spain, Argentina and several other countries playing the progress game; it is used by economy professors playing the climatologists; by newspapers editorials, and even by a State Secretary: Lehman Bros, said it!
Lehman Brothers spoke in his report about the climate in 2100 and its economic and financial projections, about climate change costs several decades away. They dared to recommend their investors what they considered a central value of the carbon ton in 50 years from now. Their sources and support references were taken from the IPCC AR4, AR3, and so on. Really impressive.
But even with their high ability to peek into the future, they couldnât predict their demise one year ahead though there were many people that had been warning about this present crash for years. But Lehman Bros were recommending investments 30, 50, 100 years ahead. Some days, reality imitates fiction. Who was Lehman Brosâ âscientificâ adviser on climate? You guessed it, James Hansen, the same guy that wants to drive the world to bankruptcy as he did with Lehmanâs Bros.
But the story has some connections with Hansen being the âscientificâ adviser to Al Gore, whoâs the Chairman of the Board of the Alliance for Climate Protection. As seen in Allianceâs website, the managing Director is none less than: Theodore Roosevelt IV. Managing Director, Lehman Brothers, Chair of the Pew Center for Global Climate Change.
Theodore Roosevelt IV is Managing Director at Lehman Brothers and a member of the Firmâs senior client coverage group, which oversees the Firms client and customer relationships. Mr. Roosevelt is an active conservationist. He is Chair of the Pew Center for Global Climate Change, Vice Chair of the Wilderness Society, and a Trustee for the American Museum of Natural History, The World Resources Institute, the Institute for Environment and Natural Resources at the University of Wyoming, and a Trustee of Trout Unlimited.
The Lehman reports in two parts can be found on this site âIntellectual Capitalâ. In âThe Business of Climate Change llâ, the following acknowledgement is made: âOn the scientific side, we are grateful to Dr. James Hansen, Director of the NASA Goddard Institute for Space Studies, who, at the end of a particularly informative dinner hosted by Ben Cotton of the Man Group, gave generously of his time to clear up a number of scientific questions that had been niggling us. Dr. Peter Collins and Richard Heap of the Royal Society provided valuable input and brought us up to date on the more controversial areas of scientific developments in the domain of global climate change.â H/T Eduardo Ferreyra originally posted to Climate Sceptics Internet discussion group.
Lehmanâs failure provides a preview of our future if more companies bank their future on the speculative advice of these advocacy scientists, politicians and environmental groups, while ignoring short term realities."