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From AP

Employees emerging from Lehman's headquarters near the heart of Times Square Sunday night carried boxes, tote bags and duffel bags, rolling suitcases, framed artwork and spare umbrellas. Many were emblazoned with the Lehman Brothers name.

TV trucks lined Seventh Avenue opposite the building, while barricades at the building's main entrance attempted to keep workers and onlookers from gumming up the steady flow of pedestrians flowing in and out of Times Square.

Some workers had moist eyes while a few others wept and shared hugs. Most who left the building quietly declined interviews.

People snapped pictures with cameras and their phones. Observers pressed up against a police barricade drew the ire of one man who emerged from the building and shouted: "Are you enjoying watching this? You think this is funny?"

Yes I do. It´s quite funny watching how this people realice that they are no longer special, that they are just like anyother worker.

Yes I do after working in the hospitality bussiness for a few years and watching how quite a few employees of the financial firms with their benefits and percentages behaved themselves, like if the outsourcing industrial bussinesses did not concern them (it´s capitalism and the invisible hand yadayadayada stuff...) like if the credit crunch for small factories and shops (you know if they can not compete in the international market why should the State bail them?) did not registered in their jobs.

Now I guess the chickens came home to roost, so once again, yes I find quite funny that now for once they are the ones receiving their pink slips, not the blue collar guys at Michigan or someother place.

M.

I do like that high and mighty asses have lost their jobs but I'd rather have had Mr. Blue Collar in Michigan lost his again. Mr. Blue Collar is unskilled labor and him holding his job doesn't give as much financial security as the one Mr. Special had.

Job outsourcing is not a company's problem. It is the American governments problem. We are the second worst country to have a large business in. About to be the worst if their taxes are raised for no reason after the next election.

I´m not against outsourcing per se, it´s that outsourcing is great until it happens to them.

And my point with Mr Blue Collar was, from the POV of some of these people, a mere number, scum, an obstacle to even higher profits and perks. Now they can have a taste of the pain Mr Blue Collar had and perhaps next time around they´ll be a little bit more thoughtful of the consecuences of their actions.

M.

The problem is that these guys aren't "Mr. Special". Oh, and Factory workers aren't necessarily unskilled. That is like saying construction workers are unskilled. Can you build a skyscraper?

I just like that Fannie Mae and Freddie Mac's CEO's had their Golden Parachutes taken away from them by the Government.

too bad the government bailed them out in the first place. They should have bailed out the people that had their homes taken away from them by those very banks. Now those folks all have ruined credit and the banks get to keep on ripping people off.

Ahtman wrote:The problem is that these guys aren't "Mr. Special". Oh, and Factory workers aren't necessarily unskilled. That is like saying construction workers are unskilled. Can you build a skyscraper?

Sir, no one man can build a skyscraper. The engineer who planned it out given enough time might be able to put it together. But on an individual basis factory workers, miners, construction workers are not incredibly skilled. They have skills they have picked up through experience with their work. Their jobs are at times incredibly dangerous as well.

Necros wrote:too bad the government bailed them out in the first place. They should have bailed out the people that had their homes taken away from them by those very banks. Now those folks all have ruined credit and the banks get to keep on ripping people off.

Those people shouldn't have been living above their means. And yes, buying a house they know they cannot actually afford on their salaries is living above their means. No one should have been bailed out, the free market can handle it.

How is it that the bankruptcy of a merchant bank cause the price of oil to drop by >$5?
I can see how it drops the stockmarket, but oil?

Fortunately here in Oz our banks still look in great shape, only a couple of the big 4 took a hit (and that was still less than a half yearly profit) and the smaller ones weren't exposed to the sub prime crisis, except credit is harder to find.

The business news was talking of a worldwide recession. Anyone else think this is on the cards?

Yes I do sir.

In short, the housing market began to fail here, this led to Fannie and Freddie failing, which is leading to other banks failing, like Lehman Bros, and now going beyond just banking there is talk of AIG's security. It has created this huge bad debt of 615 billion dollars. Yes 615 and billion. This is not the end of it either, it is the beginning. It sounds very doom and gloom but I'm sure we'll come out of it alive. If the American Dollar is worth anything after that is another story though.

The biggest problem with all this is that before this other countries 'bought' American debt as a very stable form of investment. Now it's not looking so good. There is a lot of our debt out there all over the world that is probably not getting paid back anytime soon, sorry China.

The reason oil prices are dropping is because American's are one of the larger oil consumers out there and we are consuming a lot less oil these days. There is a lot of price gouging going on here in the states. On top of that there are a ton of taxes that we have to pay when we get our gas. Given gasoline is still cheaper for us than anyone else in the world. But I was paying 1.85$ to 2.00$ when I first started driving now I'm paying 4.50$ as an average unless I buy from Citco which is selling gas at 3.99$ because it's owned by some guy who hates America, Hugo Chaves I think? Can't spell his name. But I love him, he can hate America all he wants as long as he is gouging me the least for my gasoline.

Edit: Yeah this is pure doom and gloom, GL world you relied on the U.S. economy a little too much. A lot of people are going as far as saying Economic meltdown right now. Even people who never say that stuff.

Edit2: DoW dropped more than 500 pts. today too. This is pretty scary. The banks are consolidating too if not outright failing.

I can only speak from here on the other side of the pond, but I am more optimistic now. The market had priced in a lot of this over the last 6-9 months, I think the AIG stuff was more of a shock than the failure of an investment bank today. I think that this marks the halfway point in the credit crisis though, and once it is clear that there is not much left to fail the market will start picking up again albeit with a lot of turbulence.

The credit crisis has made a lot of unpleasant things happen which will take longer to unravel. The rise in oil is the other big factor, and so the combination of lack of money for consumers to buy anything, and increasing inflation for things that need to be purchased has hurt all western economies pretty badly, with the US and UK feeling it the worst. I think it will take a year or so after the end of the credit crisis for things to start picking up again as corporations start seeing more consumer spending, perhaps around early/mid 2010. The biggest fear for me at the moment is that oil will surge upwards once there is a bit more money flowing around which will hit the world with yet more inflation and it will dampen growth again. In the UK we have a lot of exposure to the US housing market, but I think it will be something that the system will cope with (but will continue to get badly bruised whilst doing so).

My personal plan for the next year at least is to not be too obsessed with growth, and to just hedge against inflation as much as possible, but with declining commodities in the near term (due to lack of consumer demand), declining house prices (due to the credit crunch) and stagnant equity markets it is not an easy thing to do!

For the TLDR crowd: Things are bad, but we are at the middle point now, and while they will get worse they wont get much worse, unless it develops into extremely severe inflation which will be great if you have a lot of debt or a mortgage, and sucky if you have a lot of savings. All in my humble, amateur opinion though

Typeline wrote:

Ahtman wrote:The problem is that these guys aren't "Mr. Special". Oh, and Factory workers aren't necessarily unskilled. That is like saying construction workers are unskilled. Can you build a skyscraper?

Sir, no one man can build a skyscraper. The engineer who planned it out given enough time might be able to put it together. But on an individual basis factory workers, miners, construction workers are not incredibly skilled. They have skills they have picked up through experience with their work. Their jobs are at times incredibly dangerous as well.

The question wasn't "can you build a skyscraper all by yourself". Electricians, pipe fitters, iron workers, welders, et al are skilled. The engineer (and it is usually more than one) doesn't begin to do all the skilled work involved , and even then, they aren't in short supply either, thus aren't really all that special either.

Yeah, up those filthy liberal college-boy engineers!

Now that's just silly. Engineering and Liberal Arts are separate departments.

Ahtman wrote:Now that's just silly. Engineering and Liberal Arts are separate departments.

Chemistry was is in liberal arts at my school. Why do I get lumped in with the language and history majors. Why do engineers get their own department. Its not fair I tell you!

I would guess because you are in the South where Science is still equated with voodoo and mysticism. Unlike the school I went to where they taught us to regionally stereotype.

Ahtman wrote:I would guess because you are in the South where Science is still equated with voodoo and mysticism. Unlike the school I went to where they taught us to regionally stereotype.

Nonsense. We're at the forefront of technical knowledge. We have Carter's Liver Pills, and I guarantee there is someone who will give you black draught and blue mass.

Grignard wrote:

Ahtman wrote:Now that's just silly. Engineering and Liberal Arts are separate departments.

Chemistry was is in liberal arts at my school. Why do I get lumped in with the language and history majors. Why do engineers get their own department. Its not fair I tell you!

Not fair, the best girls are in the liberal arts schools. Best thing about my degree was the main Commerce lecture hall being right next to the main Humanities lecture hall. Which was a short walk from the best pub on campus.

Typeline wrote:Those people shouldn't have been living above their means. And yes, buying a house they know they cannot actually afford on their salaries is living above their means. No one should have been bailed out, the free market can handle it.

You think people went into the bank and said ‘I know I can’t afford it but look walk in wardrobes’?

Or possibly they saw that house prices were going up and up and the loan agent was telling them this was a fantastic investment, and if you scrimp and save you can make the payment each month. Which is fine, except that loan agent never mentioned interest rates could increase, putting the payments beyond the ability of that family. They never mentioned that speculation in the housing market left it open to a considerable drop in prices down the line.

One of the many problems with absolute faith in the market is that assumed everyone involved is perfectly informed, that no-one ever relies on advice from apparent experts.

And yeah, the market can handle anything, as long as 'handling it' means continuing to survive. Once you start thinking about people within that market, you start thinking about what the market should be doing, keeping people in homes and the like.

Typeline wrote:Yes I do sir.

In short, the housing market began to fail here, this led to Fannie and Freddie failing, which is leading to other banks failing, like Lehman Bros, and now going beyond just banking there is talk of AIG's security. It has created this huge bad debt of 615 billion dollars. Yes 615 and billion. This is not the end of it either, it is the beginning. It sounds very doom and gloom but I'm sure we'll come out of it alive. If the American Dollar is worth anything after that is another story though.

It counter-intuitive but 615 billion isn't that big a number, in terms of global financing. If that's the entirety of the hit from this, it won't have any significant impact on global financing. The risk is that 615 billion is just the tip.

Edit2: DoW dropped more than 500 pts. today too. This is pretty scary. The banks are consolidating too if not outright failing.

Okay, but Relic haven't changed the release date have they?

Another question.

the US government is pretty much always in debt (if memory serves Bill Clinton knocked it into the black for a couple of years).

The US government is bailing out the bankrupt institution.

In the current monetary climate who would be stupid enough to be giving the US government money?
Surely at some point someone will say 'US govt give us our money'. And they won't have any to give.

Or have they jigged it some way to avoid this?

Some people went to the housing market to speculate, to win a quick buck, but some other went because it was to buy now,even if they could not afford it, or wait 6 months and fork 50k additional dollars (or euros). And sadly that was the case of several former coworkers, I hope that they don´t default on their loans but with the economy in Spain going own the drain and the government doing nothing...

The US government will receive money as long as the US economy is the strongest of the world and nobody will try to cash their debt because it´s a way to obtain economic concesions from the US as China currently does. Of course private, Soros like debt speculators will be lurking to attack the US through its debt the way they did with the european currencies back in 1995.

M.

Waaagh_Gonads wrote:Another question.

the US government is pretty much always in debt (if memory serves Bill Clinton knocked it into the black for a couple of years).

The US government is bailing out the bankrupt institution.

In the current monetary climate who would be stupid enough to be giving the US government money?
Surely at some point someone will say 'US govt give us our money'. And they won't have any to give.

Or have they jigged it some way to avoid this?

Lehman’s is insolvent because it can’t meet it’s current debts, because it’s assets

When people talk about US government deficit spending and the surpluses of the Clinton administration, they aren’t talking about assets minus liabilities, but revenues minus expenses. It’s the net surplus, or net deficit, and is more like a regular business’s net profit figure.

Thing is, unlike a regular business it’s pretty meaningless to talk about governments in terms of assets and liabilities, because so many assets and capital projects, like roads or water treatment plants, aren’t really assets that can generate future revenues. Instead, to get an indication of government health you compare the net deficit to the government’s ability to raise revenue, comparing it to tax revenue. Tax revenue is still more than sufficient to cover debt repayments.

For all the talk of US deficit spending, and there’s no doubt it is a serious drain on the long term growth of your economy, there’s any chance of the US failing to meet future loan payments. T-bills remain a very safe form of investment. Well, assuming the run away spending and stupidity of supply side tax policy goes by the way of the dodo, which it likely will in the next election.

I don't feel sorry for recent homebuyers at all.

It had been clear for several years that, in the UK at least, the Housing Market was vastly overinflated in terms of price. The Banks and the Propety Agents were in it together. The Banks offer the stupidly high Mortgage, and the Property Agents necessitate those by over valuing even the most mundane property. And people were downright daft enough to go for it.

From the age of 21 (I'm now 28) it was abundantly clear that, until inheritance comes into the question, I am never, EVER going to own my own home. When I was 19, friends of mine bought a Flat in Tunbridge Wells for £72,000. One bedroom, with a back garden. As a first home, it wasn't bad. 2 years later, and the point of my realisation? £140,000. Some swine had gone to the property ladder, pinched the first dozen rungs, and was now leasing them out for both your Kidneys and one of your Nans.

Greed got us here people. Greed, and gross stupidity on the buying half of the market.

Typeline wrote:Edit2: DoW dropped more than 500 pts. today too. This is pretty scary. The banks are consolidating too if not outright failing.

I am a gigantic nerd. I read that and though "What does he mean Dawn of War dropped more than 500 points? He talking about resource points?" *Sigh* I think I'll go crawl back into my nerd cave and comfort myself with cheetoes and mountain dew.

Grignard wrote:

Ahtman wrote:Now that's just silly. Engineering and Liberal Arts are separate departments.

Chemistry was is in liberal arts at my school. Why do I get lumped in with the language and history majors. Why do engineers get their own department. Its not fair I tell you!

At my school, I was in the College of Chemistry. A whole college of our own that only did 2 majors, chemistry and chemical engineering. It was kind of odd being the only engineer that wasn't in the college of engineering. *shurg*

I can build a 40k skyscraper if you give me enough plasticard. I'll even post a blog about it in the modelling forum...

Grignard wrote:

Ahtman wrote:Now that's just silly. Engineering and Liberal Arts are separate departments.

Chemistry was is in liberal arts at my school. Why do I get lumped in with the language and history majors. Why do engineers get their own department. Its not fair I tell you!

This clearly was not a Texas school. You would have your own building and be broken into petchem schools and inorganic chem schools.

OTT but Ahtman's just jealous of our refined chemical dominance. Wait that sounds funny...

Gonads: The US government has had a national debt since Alexander Hamilton was the Secretary of the Treasury. Government debt basically gives the government an oar in the water, so to speak, to help keep the economy going. It's closer to a paddlewheel now.

We have a huge deficit right now (ie, we're losing money every year). Bubba (President Clinton) had a few years as president where he managed (with Congress' help) to have a surplus and pay back some of the debt.

That has long been wiped out. Thanks for the Iraq war, jackasses. (Afghanistan is a different story).

The housing market: People are greedy and ignorant, and they didn't do their homework for one of the biggest purchases they'll ever make. I know some of them got rooked, but most of them... well, screw 'em.

http://en.wikipedia.org/wiki/United_States_public_debt

edit: I haven't read the article in full to detect whether there is bias or not. Just
throwing it out there for the interested.