Wednesday, February 24, 2010

Lehman fallout

Dozens of cities and counties around the country, from Sarasota, Fla., to Boulder, Colo., lost a total of $1.7 billion when Lehman went under, because they held Lehman bonds or other securities. The two worst hit states are Florida and California. Florida public agencies lost a total of more than $400 million, mostly from a state investment pool. California municipalities lost a total of $250 million across some 28 cities and counties.

San Mateo County's loss was the biggest of any municipality. Under state rules, the county government, city governments and area school districts hold their operating funds, reserves and bond proceeds together in an investment pool that lost about 6% of its value when Lehman went under.
Now who acquired Lehman? Barclays. And how was their latest year?

Profits doubled to over $18 billion, earning the most of any European bank.

Even Lehman is suing Barclays for the additional $5 billion that they greased the skids with, so executives at Barclays could get bonused.

 Lehman's bankruptcy was just another gigantic transfer payment from Main Street to Wall Street!

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