Or, is Lehman a Bye, Bye?
Is Lehman the one that the Fed will let go down to prove it does not bail out everyone? Is Lehman too interconnected to fail (the Bear Stearns standard) or not? Probably not. Moreover, everyone has had a warning on Lehman. I'm not Lehman basher but I think these are the things we must be thinking about.
Now that the distraction of Fannie and Freddie is removed or at least set aside, the market players look for their next poster child of market tenderness. That has to be Lehman.
Losing its Korean connection was a bad thing for Lehman. I don't know if they haggled with the Koreans over price or control or what the sticking point was but from the outside it looks like ANY DEAL would have been superior to what the market has done to Lehman.
Where do they go now? And there are reports that they have more losses to report. It's a grim time for Lehman.