Flush DBS High Notes 5 Down The Drain

After a prolonged wait for embattled investors who bought into Lehman linked products, their worst fears have been confirmed. While mediation for Hong Kong Lehman minibond investors is currently underway, for those who purchased DBS High Notes 5, they might as well flush them down the drain.

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Stock Markets Bolstered By Bailouts

In the past week, we have venerable investment banks Lehman Brothers folding and Merrill Lynch merging with Bank of America, leaving Goldman Sachs and Morgan Stanley as the remaining bastions of independents on Wall Street. Read the full article here.

Will Wall Street Learn From Lehman Brothers Bankruptcy?

Already, a Lehman Brothers bankruptcy implies a fire sales of its assets (stock, bonds, property and mortgage securities), depressing prices and forcing more write-downs by other banks and investment banks. In the coming months, we can expect tsunamis to test the foundations of the financial sector again.

Why was Lehman, a 158-year old financial institution, which survived world wars, scandals, in-fighting, loss of its independence, finally shuttered? Read the full article here.

11 Bank Failures In 2008 And Counting

Before these banks walk into history without so much as a mention, I think we shall do a brief body count for them.

1. Silver State Bank

Nevada regulators shut down Silver State Bank and the bank’s insured deposits will be assumed by Nevada State Bank of Las Vegas.

Andrew McCain, son of Republican presidential nominee John McCain, was previously a member of the bank’s board. Read full article here.

Korea Development Bank And Lehman Brothers

Interesting news that Lehman Brothers may be saved from its insolvent fate by Korea Development Bank. Rumors have emerged that a very big investment bank on Wall Street may fail in the near future and Lehman Brothers is a firm candidate.

Lehman Brothers and Wall Street can rejoice but is it a wise decision by Korea Development Bank? The state-run lender has performed poorly in overseas investment and is now lined up for privatization. Net profit halving to $24.6 million in the first half year-on-year.

The setback stands out against other local commercial banks, such as Shinhan and the Korea Exchange Bank (KEB), which enjoyed excellent profit growth abroad. Their lackluster performance is mainly due to high exposure to subprime mortgages and poor risk management.

Korea Development Bank has as good a chance as Lehman Brothers of going under by taking up more mortgage risks. Will they break with tradition and score a home run this time round? Don’t bet on it.

Korea Development Bank’s Chief Executive Officer Min Euoo Sung declined to comment on a Reuters report that the state-run lender is “open to” a potential acquisition of Lehman Brothers Holdings Inc.

Reuters, citing an unidentified Korea Development Bank spokesman, said Korea Development is studying a number of options, including buying Lehman.

The government is aiming to privatize the bank by 2012, and acquisitions of domestic and foreign companies may help the company expand ahead of that target.

Lehman spokesman Mark Lane declined to comment when contacted today by Bloomberg. Lehman, based in New York, is the fourth- largest U.S. securities firm.

Source: Bloomberg

Wall Street Forsake Financial Stocks

It was a punitive end to a roller-coaster week. Dow Jones breached 11000 (a first time low in nearly two years) but pulled back to end at 11,100.54, losing 128 points. Standard & Poor’s 500 index lost 1.1% while Nasdaq composite shed 0.8% to remain above March lows.

Read the full article at http://jeflin.net

Oil Speculators Calling The Shots On Wall Street

I expected bearish sentiments in the stock market for this week because there is simply no good news on the horizon to spark a revival.

When I say revival, I mean sustained gains in grounds of over 100 points, not 20-30 points as this usually implies a zigzag pattern for further slides.

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Dow Jones Rally Will Lift Local Stocks

After Wall Street’s deplorable results last Friday, the question for ST Index today is not a matter of battering but how much collateral damage we will be seeing.

An oversold rebound for the Dow Jones is in order here, could be early this week.

Read the full article at http://jeflin.net

Strong Dollar Gives Hope For Recovering Economy

The red ink continues for the second straight day on the Dow Jones, even the sprightly oil sector was not spared.

Oil prices was hit by a strengthening dollar after the Fed chairman, Bernanke said the economy remains under pressure, but he is unlikely to cut interest rates again soon.

Read the full article at http://jeflin.net