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Bank of Japan injects Y2.5 tril into markets as Lehman Japan also files for bankruptcy

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The Japanese watchdog also ordered Lehman not to harm the interests of creditors and investors through the outflow of money in the wake of its bankruptcy.

In short, freeze on Lehman Brothers assets in Japan, timely action to protect j-investors.

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I can't remember is it was this board or another but I remember somebody who claimed to work for Lehmans in Tokyo thinking it was funny when Nova went belly up stranding a bunch of foreigners. I'm not in either business but feel bad for all the people booted out of work.

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The arrogance of the lehman CEO is there for all to see. I wonder how guys like him sleep at night, their hubris costing so many their livelihood. Yet most likely he'll get rewarded with hundreds of millions in stocks and compensation proof that the bad guys always win in the end.

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Now that's FAST action!!!!!!!!!! The FSA really took decisive action here!! Goody on them! Don'T anyone call them useless! They really learned from the Nova debacle!

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rjd jr: This time you're absolutely 100% correct. Stan O'Neil ex CEO of Merrill Lynch was paid out $148 million, Charles Prince ex CEO from Citicorp about the same amount. These and a few more, are the guys that were the architects of the subprime mess and allowed delinquent loans etc. And they're compensated so handsomely? Obscene ain't the word....

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Don't you know that one of CEO's talents is the ability to lie? They were top-notch hustlers.

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I've never heard anything good about their CEO either. Hopefully FAS action here will protect some people.

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Merril Lynch or Lehman did not hire laymen, they are well qualified CEO's, Master minds in manipulating global money markets in a systematic fashion. They deserve highest remunerations. Blame those who left these markets 'unregulated'.

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Worried for good friends and former colleagues that have moved on to Lehman's. This is sad news for people we care about.

Too bad the greed of a few short sighted and overly greedy people and companies has resulted in so much hardship for normal working people. We should start to criminalize business behaviors that endanger our economies and our working people. The people behind this crisis and their greed should be seen as criminals and should be held very much accountable for their actions. Beyond just the loss of their money.

We need responsible, rational people making good long term decisions. Our economy has become too much about the moment and too many people suffer from this thinking. Look at this crisis and the insane oil prices earlier this year as examples of bad long term thinking and sheer unadulterated greed driven decisions.

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Does anyone know how many people worked at Lehman in Japan? Too big to fail? Who is next?

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some14

and WHO do you think faught having regs put in place??

These CEOs need to be brought up on chgs for the things they have MANAGED to do! I wudnt be surprised if a few of these a$$holes get theirs eventually

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lazyman0909 The news last night said that Lehman employs around 1,300 in Japan. Seems like a lot to me. What do they all do, I wonder. I imagine that this morning Goldman Sachs and Morgan Stanley will be getting heaps of job applications.

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Merril Lynch or Lehman did not hire laymen, they are well qualified CEO's, Master minds in manipulating global money markets in a systematic fashion. They deserve highest remunerations. Blame those who left these markets 'unregulated'.

Some14some, have to agree with you to a certain extent, John Thain agree will come out savy for making the necessary cuts and write offs to make Merrill Lynch viable, sold at a 70% premium! ($29 a share vs friday close of $17.05). Fuld however will be paid out handsomely for a ruined reputation. They never seemed to try hard enough to clean the balance sheet (%50bn in real estate related assets at the end of 3Q08...)and the held out to be independant when the did not have the means to.

The real blame for this fiasco to a large extent lies with our regulators and central bankers. Whilst hindsight is always perfect, Greenspan had known for a long time that the housing market was well past a bubble. If the problem had been handled earlier, the issues would not have been as bad. The liquidity in the nmortgage market interestingly was not from Freddie and Fannie (though it is their role). The problem arose when there became increasingly high levels of mortgage loans that failed to meet their standards and as a result their share of mortgage recycling via MBS fell. This shortfall was taken up by the likes of Lehmans

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Bush and his republican buddies have did in 7 years.... what took decades in the early 1900's to do....

This is all on the republicans....

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Another one bites the dust.........Wow can we say way to go Bush baby! Your administration has killed another major investment group!

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With apologies to Hans Gruber...

Ladies and gentlemen, due to the XXXXX Corporation/ Bank (Fill in the name) legacy of greed around the globe, it is about to be taught a lesson on real power. ..

Feel sorry for the little people there, the ones who did not get the multi-million dollar bonuses, back office and support staff. Plus business will be down at the restaurants and bars that they frequented...

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I think Lehman has between 2000 - 3000 people here.

Heartland will never be the same.

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Sorry, but I will disagree with many of the posters here. (I know, no surprise there.) The only folks I feel sorry for are the administrative/clerical employees of Lehman, and the owners of Heartland bar, who won't have the Lehman trader-guys throwing their money around anymore to impress the J-gals. And Mori, that is hung with a lot of space. Respectfully, these traders are highly paid gamblers who manage risk as part of their job. They add no real value to the economy or society, and just push the prices of commodities up. So, if they took a risk on Lehman, and got burned, so be it. No one felt sorry for them when they were raking in their big annual bonuses. That sword cuts both ways.

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wow, look at all those thoughtful replies. Too bad not a single poster has a slight clue of what is going and what happened here. Well, I will be brief:

This resulted in US government intervention in markets by artificially lowering interest rates and setting up 2 monster mortage companies. In addition, US government spends so much money on welfare and foreign policy, they can't afford to bail out bad loans anymore. Lehman CEO didn't have anything to do with it. Their operations involved mortgages, they suffered heavy losses and then their investors ditched them. Whoever said stock options: yes, they probably had some Lehman stock, which is now worthless. Believe me, the only ex-Lehman employees who got them good for themselves are the ones that got laid off before today. At least they got severance.
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Roppongi Hills is gonna be all hollowed out. No more strippers and blow!

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This is not good.

Everyone should be very worried.

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More bad news: AIG stocks just fell 60% today.

oooph.

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Heartlands is going to be a bit quiet this week.

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The Wall street model has got to go. It's antiquated and designed to benefit employees not shareholders with outrageous salaries and bonuses and worse, no accountability. Lehamans had leverage of around 30% of its book value over 20 billion it had a 700 billion dollar balance sheet, which is like having a 97% mortgage on your own house, so if the market value drops you lose all your equity. And that's exactly what's happened to these firms... They were enormously over-leveraged and when the market turned against them as it so savagely has, they go belly up. Wall street is run by people looking out for themselves, no one else. Who pays when they screw up? We do.

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They operated as most of live our lives!!!!!!! Most of the happy FOLKS you see ambulating down the street are dangerously in debt BUT they don't know it!! They THINK they can pay for their STUFF , but in reality they HOPE they can!! Wall Street rewards RESULTS!!!!!!!!!!! RESULTS drive everything!! "Hank, GET ME RESULTS!" "Yes Boss" The blame for this mess lies in HUMAN NATURE!! It WILL happen again and again.............

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A lot of posters here seem almost to be happy that rich traders are losing their jobs. Smacks of jealousy to me. I'll agree that working in the industry you have to be prepared for bad times as well as good times and these traders should know that. However, it's never any fun to lose your job in a market that doesn't look like recovering for a long while. So I feel for these guys. Also, I think you can blame the CEO. He kept on hiding the real position of the company and also didn't take enough painful steps early enough to svae it.

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He would have been FIRED as in "YOU'RE FIRED!!!!!!!!" If he had taken steps to avoid this mess. He would have been fired and Lehman stock would have been punished. It's all about RESULTS!! If the other company gets'em you gotta do the same...OR ELSE!!!!!!!!!! The CEO might have had 300 million, but now he's got 3 million. He takes out A LOT of workers when he falls!!! In other words that dog had a lot of fleas. Well, the dog lost it's hair and the fleas lost their home and meal ticket and the shops they went to lost their customers...ect

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Guys! it's really critical situation! does anyone remember when last time JP government request a big foreign co. to suspend? Just sell your stock and buy gold ASAP!

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And it all could have been avoided if a realistic model had been used. Of course I'm jealous of any trader taking home a salary usually only heard of in Hollywood But when investment banks are leveraged out the wazoo and traders are not accountable it's a house of cards that's gonna fall. Sure, it works great when the interest rates are in your favor in fact they looked like geniuses but when the rates sour and leverage bites back, this is what happens.

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A lot of posters here seem almost to be happy that rich traders are losing their jobs.

Who? You're projecting your own feelings here.

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Merril Lynch or Lehman did not hire laymen, they are well qualified CEO's, Master minds in manipulating global money markets in a systematic fashion. They deserve highest remunerations. Blame those who left these markets 'unregulated'.

Errr, the companies just went bust, so they weren't so smart after all were they ? Masters of window dressing and creative accounting more like, but sooner or later the truth will out, in this case they appear to have suffered a severe short circuit.

The markets are "unregulated" to allow market forces to work, over regulation is seen to stifle innovation. Sadly the people working in this industry appear to lack any moral fibre, self respect or common sense. They should be made personally liable for all losses, since one of the basic rules of capitalism is the relationship between risk and return. This is the only regulation needed.

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Guys! it's really critical situation! does anyone remember when last time JP government request a big foreign co. to suspend? Just sell your stock and buy gold ASAP!

FYI: 1328.O

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Looks like Lehman Brothers Japan Inc. filed for bankruptcy as well.

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the game works like this: hype up your company, over-capitilize it by stock sales crediting your 'additional paid-in capital', and give yourself a BIG FAT SALARY. if the company sales do just slightly well, or some other development/news can justify hyping the company further, then your stock goes up thru the roof, and while you're at it, SELL SELL SELL for your stock options.

then poof! it's all just a house of cards.

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It's time to hide your cash under your bed !!!!

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We all suffer thanks to the lack of control exercised by the American Republican government

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Yay! Here's the old 'THROW MONEY AT IT AND IT'LL GO AWAY' practice in clear view again!!

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"It's time to hide your cash under your bed !!!!". not spending your money is the best way to crash the economy.

The money you don't spend is all the money others won't enjoy spending and will finally somehow come back in your pocket.

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not spending your money is the best way to crash the economy.

Govt is spending a lot and still....? in my case, i dont spend money and instead have authorized govt to spend on my behalf :)

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Creative accounting? These guys create nothing. They are locusts, parasites. Good riddance. Next AIG.

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I have a short position. Kaching!

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Good one here.

http://iamsheamus.com/images/capitalist.gif

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Yay! Here's the old 'THROW MONEY AT IT AND IT'LL GO AWAY' practice in clear view again!!

There is a nasty feeling of deja vu isn't there.

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Agree, if everyone stops spending then things will crash for certain.

Just be reasonable. Don't panic. The smart people will use good judgement with spending and carry on with life. If you have risky exposure with investments, then adjust them. Otherwise a long term view is still smart.

If everyone panics then we invite a new depression. If everyone stops spending then recession for sure, depression possible.

What we should all learn from this is that we cannot allow these financial and corporate systems to run loose. Regulation may be bad for some business opportunties that will make that tiny group of people some money. But it is certainly good to limit the damage those same corporate gambles might bring to us all into danger. Time to bind these guys a little tigher and teach them some civic responsibility.

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Jerseyboy and bluemonday have it about right between them,waste no sympathy on any investment banker 99% of the time the career is motivated by personal greed with a ****the "little man" mentality. Until there is a situation where employers and employees are all liable for the results(with no time limits)of all actions taken during their time with a company, there will continue to exist the "get rich quick and get out" mentality of all these superficial jerks. If i was regulating i would immediatly outlaw short selling of everything,and gradually phase out derivatives trading,if you want to invest in a sector..the only legitimate way should be by the direct holding of the physical stock. Short term investors looking for a fast buck should be disincentivized by the creative use of variable rates of tax/stamp duty, making short term investment horizons considerably less attractive. Today and indeed yesterday there will be many people managing to "make" huge "profits" by the shorting of banking stocks..which will itself make another collapse like Lehmans..more likely. This banking confidence crisis will now probably get worse before it gets better..the ceo of lehmans had the opportunity to sell out to the Korean development bank in the last couple of months..he turned down the offer of $29 dollars a share. Free markets work..but as soon as a free market starts to be viewed as an "investment market" then there is a pressing need for very rapid regulation..housing,commodities,oil..all have been free markets.. the trouble begins when people invest,not because they need a house to live in or oil to refine into petrol to sell, or copper because they are a cable producer,but just because they believe they will be able to sell it some time later for more money. The employees of lehman and other "blue chip..triple aaa rated,LOL companies",quite happy to bank money in the "good times",times before their criminal irresponsibilities become visible, should be made to make reparations personally as far as is necessary..if that means all the way to waiting tables..so be it. If there is no liability when it goes pear shaped..whats the incentive to behave responsibly?

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The entire world economy is an elaborate ponzi scheme!! ferchrissaks don't tell anyone.

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I have a short position. Kaching!

Sweet Nessie. I have been following it all day. KACHING x2!

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I always love how everyone all of a sudden becomes experts in the Stock Market. It is always easy to blame the CEO for everything. It is much more complicated then simply being greedy as everyone so loosely throws out there. Not saying they aren't partly to blame but the fact that there are other factors involved which contributed to this. The continued poor performance in the housing industry is likely one culprit.

Holdings in the Insurance Industry and the continued bare market which no one would admit to hasn't helped either. Investment firms like Merrill Lynch of which I used to have stock in got in over their head. This in part may be why they decided on the merger as were in similar shape as Lehman Brothers. They likely panicked and didn't want to take the chance of not having a buyer if the bottom fell out.

During the housing boom loans were being given out like water with no accountability. People that got loans in many cases should never had in the first place. When the market turned south the banks were getting back more foreclosures then they could handle. Mortgage lenders were scrambling for creative ways to keep people in their homes but the sub-prime market was already teetering on the brink.

Now here is where things get complicated. As the war in Iraq continues to suck the US economy dry. A debt which is reaching galactic heights, and a dollar which is about as worthless as the paper it's printed on. The US is looking more like a starving lion on the savanna then the economic powerhouse it once was and likely never will be again. The rest of the world has loaned the US a pair of crutches to bolster the worthless dollar while we prepare for the eventual meltdown which is slowly coming to pass.

China and Japan currently hold over $1.7 trillion in US currency and US-based assets and can hardly afford to have the ground cut out from below the dollar. The US debt increases some 1.93 billion per day and is currently at 9,689,987,709,740.14 and counting ouch! In the last fiscal secession figures indicate that foreign investment is drying up and the world is no longer eager to purchase our lavish debt. The only thing the Federal Reserve can do is raise interest rates to attract foreign capital or let the dollar fall in value.

The problem, of course, is that if the Fed raises rates, the real estate market will collapse even faster which will strangle consumer spending and shrivel GDP. In other words, we are at the brink of two separate but related crises; an economic crisis and a currency crisis. That means that the unsuspecting American people are likely to be ground between the two mill-wheels of hyperinflation and shrinking growth. In real terms, the economy is already in recession.

The growth numbers are regularly massaged by the Commerce Department to put a smiley face on an under-performing economy. Industrial output continues to flag while millions of good paying factory jobs are being air-mailed to China where labor is a mere fraction of the cost in the USA. At the same time, foreign investment will move to more promising markets in Asia and Europe causing a steep rise in interest rates. This is bound to be a stunning blow to the banks which are low on reserves ($44 billion approx) but have generated $4.5 trillion in shaky mortgage debt in the last 6 years.

What makes this worse is that Lehman Brothers has assets in access of 600 billion. So it likely will take years to sort this out and no bank will be able to bail them out. This is just the tip of the iceberg though as AIG problems if they go south well likely send the US economy into hell! Therefore making US a third world country almost overnight lol. AIG assets are so large and widespread that likely no one in God's green earth will be able to stop the earthquake that will likely ensue. Is it any wonder why the foreign central banks are so skittish about dumping the dollar?

No one really relishes the idea of a quick slide into a global recession followed by years of agonizing recovery. Maybe this whole 2012 thing was right after all. If that's the case then good thing I am learning Japanese as I may need it in the future as the USA sells it's soul to the underworld lol. In closing this makes me wonder if having a few more centuries of experience would have been any different or would we be any more wise? Hard to say but one thing is for sure we really should have payed more attention in history class as it is coming back to bite us in the ass!

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Slowly but surely Bush doctrine beings to show its worth. As more and more US Companies begin to fold the full scale of this Administration shows its show self.

What took hundreds of years to produce a single Administration and it`s doctrine destroys.

Can this Country keep pace with the rest of the World with another Bush in the White House?

No, I say it is time for a change, vote out these leeches and get some new blood in there.

Bush Cheney no more/ Obama 08!

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Another one bites the dust! Lost of posts are so right. Greed takes away what little money poor Joe could make. The way economies are and goverment operate is on the same principle: give to the rich more and to the one who is in low wages less. My belief is, some money needs to be flowed into the poor because the poor will always have a need to spend the little they have. Money goes up from the poor to the rich. So, as long as there is money put back in the poor's hands, there will always something to flow back up. if you expect rain to fall, some must evaporate from the ground. Otherwise there will be nothing to fall back down. On another note: banks will collapse like dominoes. And, if the Japanese spread rumors like they always do, they could do some heavy damage to themselves.

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Hard to say but one thing is for sure we really should payed more attention in history class as it is coming back to bite us in the ass!

Excellent post, ReikiZen!

Santayana's saying about those who forget history has never been more true. We have been here before.

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Well done ReikiZen. I couldn't agree more.

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this goes all the way back to the dot.com bubble bursting. the govt. intervened just like they are intervening again. we didn't take our lumps back then, so we're taking them twofold now. the u.s. has to realize it's becoming a socialist country. this is why the bankers took all these stupid risks - they know they'll be bailed out. if we were truly capitalist, bankers would have been a lot more careful about managing risk and we wouldn't be in this mess

finally, no bailout for lehman bros. - that's the way it should be

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People need to relax, the markets are so jittery and banks and investment houses are failing as shareholders go into an all out panic. It's self fulfilling profecy and the media hype just keeps driving the panic.

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ReikiZen, you make a lot of good points, but they don't support the initial argument that we shouldn't blame the CEOs.

There are plenty of large banks that are doing fine out there despite the mortgage crisis in the US. I think the long and short of it is that the CEOs decided the risk/exposure they were willing to take. Institutions that followed traditional/conservative standards will weather this period just fine. In fact some are doing quite well stepping in for the companies that have fallen. Those that choose to risk it should pay a price, and the CEOs shouldn't be rewarded for their mistakes.

Ultimately the CEO choose the direction for the company and sealed their fate.

You're absolutely right about history repeating. Even worse, it's not like people weren't warning wallstreet about it. Warren Buffett has been warning people the problems in the housing/lending system since 2003.

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No one really relishes the idea of a quick slide into a global recession followed by years of agonizing recovery.

I do. It means mad profit.

http://www.youtube.com/watch?v=JaKkuJVy2YA

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The Democrats should have taken President Bush's advice in 2003 when he fought for the establishment of a committee to regulate financial institutes like Freddie Mac, Fannie Mae, and Lehman Bros.

http://query.nytimes.com/gst/fullpage.html?res=9E06E3D6123BF932A2575AC0A9659C8B63&sec=&spon=&partner=permalink&exprod=permalink

Of course, Democrat presidential nominees for the past 12 years have been in their pockets. It is not a surprise that they blocked all efforts to cease any proposals and bills to regulate these institutes:

http://www.liveleak.com/view?i=efa_1221617258

Have fun looking over that.

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helloklitty, fascist might be a more accurate description.

'Fascism should rightly be called Corporatism, as it is the merger of corporate and government power.' -Benito Mussolini

motytrah, the blame rests equally on those people who bought into the delusion. I have no pity for greedy people - be that the CEO or the McMansion owner.

MPNiea, smoke and mirrors my friend.

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"The Democrats should have taken President Bush's advice"

Absolutely! Bush has spent 8 years trying to undo the democRAT damage, but what they did in the 90s was too great. If the democRATs are allowed to come back to power things will only get worse. We need to focus on Republican values: Jesus, bombing Iran, stopping abortion.

This is Palin. This is the cure for America. Join us or die.

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Could we please cut the crap with this ridiculous US election commentary. It's totally irrelevant who gets elected.

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Now is a good time to buy.

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