Monday, 15 September 2008

Lehmany Snicket

Reading further today about the collapse of Lehman, and what seems to be the imminent and real threat of the fall of AIG (by the way, why doesn't somebody just point a gun at those credit raters at Standard & Poor's? Tell 'em in no uncertain terms NOT to downgrade the AIG rating? Am I being naive? This is scary shit, and getting closer to home all the time. I bank with HBOS...

I've been stunned by the images of staff taking their trainers and other office detritus away in cardboard boxes. It looks as if these people are going to be given precisely jack shit as a leaving present. No pension, no bonuses realised (as they're all pretty much linked to stock options) and - more crucially - no fucking pay!

I read that Lehman Brothers had (!) 2.2 million square feet (!) of office space in Manhattan. Will this now become vacant? It's facile, sure, but couldn't there be a way to use the office blocks for people who don't have anywhere to live? I mean, why not? What happens to all the furniture? All the carpets and artwork and high end TVs? All the laptops, blackberries, fibre optics and copper. The kitchen equipment, the CCTV and the company cars? Are these going to be hoovered up by Barclays before they too hit the shitheap? Could the whole thing possibly have been prevented? But more importantly, what happens now?

Richard Wright is, quite frankly, better off out of it.


5 comments:

EP said...

The buildings (assuming they are even owned by Lehman in the first place) are assets which will go into the pot to pay out to creditors.

My first guess is that they would be worth less if they are full of homeless people. I'm no financial expert mind you...

Harsh as it sounds at some point some financial institutions must be allowed to fail. We can't go on privatising profits and socialising losses. Without the concept of "moral hazard" banks will continue making reckless choices safe in the knowledge that nothing truly bad can ever happen to them.

Would I feel differently if I were a Lehman employee? Of course I would but that doesn't negate the above.

marie said...

you're bloody right ep,but on one point: financial institutions musn't be allowed to fail- as they shouldn't be allowed to succeed in the first place.

don cake said...

Yeah, boo-hoo.
I can't feel a great deal of sympathy for a bunch of people who were all happy to go along with things.
According to Reuters, the average pay at Lehman's in 2007 was over $300,000. So, yes, let's give them free board somewhere.

Myeral said...

Aren't we all happy to go along with things? I know I am - especially when those things are a merger of my bank to save it from insolvency.

don cake said...

It's up to everyone to decide at what point we draw the line and say, "no, I'm not going along with this." It will cost you though.
But if we allow our leaders to just decide what's good and bad then we deserve what we get.