Maybe you spent your weekend sweltering at an end-of-summer wedding or running around doing errands or ironing your sheets or what have you. But while you weren't paying attention, the shit was going down. A number of financial institutions bit it and bit it hard. In particular:
Lehman Brothers: Richard Fuld's proposal to split the bank off into a good bank (the stable Neuberger Berman unit) and bad bank (all their crappy mortgage stuff) basically totally failed: Barclay's shied away at the last minute from buying the good bank and Bank of America, among others, turned up its nose at the bad bank. And since the Fed suspects if they bail out another such institution they'll then have to bail out everyone, they're letting them twist in the wind. (Sorry, little bro! See you at Thanksgiving!) Early this morning, the 158-year-old firm filed for bankruptcy and is currently liquidating its assets.
Merrill Lynch: Since Bank of America was at the market, we guess they thought they might as well buy something. Last night, John "We believe that we are in a very comfortable spot in terms of our capital" Thain sold the 94-year-old brokerage, which lost $45 billion on mortgage assets this year — two times more than it made in the two years before the credit crisis, by the by — to BofA for $50.3 billion in stock.
AIG: Meanwhile, in the middle of all this, AIG — otherwise known as the American International Group Inc., the largest U.S. insurer — announced it was facing a major liquidity crisis and was like, hey, Fed, we'd like to borrow 40 billion fucking dollars.
The markets are about to open, and it's about to get real ugly. Hold on to your hats, folks.