Toomre Capital Markets LLC

Real-Time Capital Markets -- Analytics, Visualization, Event Processing, and Intelligence

Ut Oh… Barclay's Walks Away from Potential Lehman Brothers Acquisition

According to both Bloomberg and the BBC, Barclay's has walked away from its potential acquisition of the "good bank" portion of Lehman Brothers. This leaves the reluctant Bank of America as the only apparent acquirer of that "valuable" asset. As has been the case for the past three days, the key stumbling block appears to be credit / financial support needed to ring fence the approximately $85 billion in "bad" real estate assets at the heart of the Lehman Brothers crisis.

The Federal government is the deep pocket that all of the major financial players want to come to the table. However, Treasury Paulson appears to be sticking to his statement that there will be no Federal funds available for a Lehman Brothers rescue. Prepare for a really rough market in the days to come!!