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Meltdown Monday: PRimage on Wall Street’s Woes « PRImage

Meltdown Monday: PRimage on Wall Street’s Woes

The repurcussions of the demise of the 158-year-old Lehmans US bank continue to be felt across the world: gobal stock markets have tumbled after ‘meltdown Monday’ and thousands have lost jobs. Judy Viitanen has read that Lehmans had 35 times debt to equity! … unbelievable! The ‘lethal loans’ of the sub-prime market scenario in the States has led to this biggest shake-up on Wall Street in decades and it is frightening to see investment banks like Lehmans going down like nine pins and plunging markets into turmoil. And now it seems that the future of American International Group (AIG), once the world’s largest insurer, is in doubt. Their shares have plunged 54.6% as fears grow over its financial future. AIG is under pressure to raise capital after posting three quarterly losses in a row totalling $18.5bn (£10.3bn).

In the UK the Stock Market slumped by 200 points yesterday; and HBOS shares have been battered, with questions about their practices of shortselling. There are rumours that Barclays is in talks with Lehman Brothers to buy its core U.S. broker-dealer businesses, including equity, fixed income, M&A advisory and other parts.

In our view, big lenders should stop believing that they can be bailed out! PRimage is relieved to hear that Chancellor Alistair Darling says action is being taking to tighten up the UK’s financial system to prevent further bank crises. Let’s hope that the circle is squared on this! Watch this space …..

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