No Utility Today

I had another post already written for today talking some more about utility odds in tournaments and responding to some of the commentary to my post from yesterday, but you know what? Fuck utility odds. Just look at this shit instead:

LEHMAN BROS HLD(NYSE: LEH)
Last Trade: 9.29
Trade Time: 11:59AM ET Tuesday, Sep 9, 2008
Change: - 4.86 (34.35%)
Prev Close: 14.15
Open: 12.92
Day's Range: 8.00 - 13.10
52wk Range: 12.02 - 67.73
Volume: 137,421,857
Avg Vol (3m): 58,416,800
Market Cap: 6.86B

Is that fucking sick or what?

See, this is exactly why I recently left this company for a new employer. I saw a company that had a ton of problems, sure. Anyone could see that. And I think I could have lived with that on its own, maybe, if things seemed to be being dealt with adequately. But the biggest problem and the biggest reason I felt the need to get the fuck out of there is that I saw a senior management team at Lehman that was focused solely on denying its problems rather than doing whatever it had to do to fix them.

Look at Merrill Lynch -- a couple of months back they sold friggin $30 billion of shitty mortgages for literally 22 cents on the dollar, and at that they even financed 16 cents of the 22 cents on the dollar that they sold these for. It was a massive, sick haircut for them and a huge black mark for management and for the firm as a whole, but it got the company rid of a significant portion of the huge problem assets that had been plaguing the company for some time and were perceived (correctly, obviously) to be likely to continue plaguing them if they didnt get the mortgage assets off their books. So their management team bit the bullet and they just did it.

Lehman's CEO, on the other hand, has been reportedly shopping between $15-40 billion worth of Lehman's own messy mortgage portfolio for the past two months, basically ever since the day that the Merrill announcement first hit the wires. But by all reports, the donkey in charge at Lehman refuses to take more than a 5-10% discount on the current value of the mortgages, even while Merrill, a company in not nearly as desperate of shape as Lehman, took an 80% or more hit on its own very similar portfolio.

Similarly, Lehman has reportedly been in talks with KDB and a few other large banks in Korea and China about acquiring a controlling stake in Lehman (too lazy and pissed and upset to link these, but the stories are everywhere if you do a simple search on Google or Yahoo! Finance), and now those deals have fallen through, which is the proximate cause for today's huge, sickening selloff. But why have those talks ended without the capital infusion that Lehman so truly desperately needs? Because reportedly the donkey CEO is insisting on selling the shares for 50% above Lehman's book value. Without getting into the details of exactly how book value is calculated, suffice it to say for this dicussion that book value is a paper value, an accountant's calculation, based on the value of assets in the company at the levels they are currently marked to on the books. Lehman's book value is currently $34 a share. So the CEO basically wants someone to buy 50% of the shares in the company for $51 a share, when it is currently trading even before today at $13. Smarrrrrrrrrrrrt.

Current leadership at Lehman Brothers refuses to accept the basic fact of business that when a seller is a distressed seller, meaning that everyone out there, including all the potential buyers of what they're trying to sell, knows that the seller is desperate to conclude a transaction, that hurts the price that someone is willing to pay for whatever is on the market. This isn't my opinion, this isn't something which a man or a management team or an entire company can just "decide" does not apply to them. It just does. Lehman management also refuses to accept that it is at this point commong fucking knowledge that the company is not worth anywhere near the value of assets as currently listed on their books. These hubris-infused fools have literally sat by insisting on the world for their low-value assets and highly dubious stock price, all while the rest of the financial markets and now Lehman's own share price have crumbled all around them. And what are they left with now? That's right -- absolutely nothing.

It is criminal how negligently poor this company's response has been to all the bullshit of the past year. What Lehman's leadership is doing and has already done to so many thousands of the company's employees' lives cannot be forgiven or even forgotten. I care about the damage done to the investors in the company's shares over the past few years, sure, but at least those people knew when they were investing that they were taking a gamble. Anyone who's gotten in at any stock price over the past 14 or 15 months has certainly been (or should have been) well aware of the credit crisis and at least generally the ramifications that could be had on the world's big investment banks. But it's the employees of the company, whose jobs, livelihoods, whose families' financial security depends on the company, whom I feel for the most.

Right now I just hope that management of Lehman Brothers gets what's coming to them, either in this life or the next. Somebody should be held accountable not for the credit crisis per se, which surely cannot be blamed on any one person and obviously not on Lehman Brothers specifically, but for the reaction (or total lack thereof) that has gone down at Lehman over the past year, and more specifically over the past eight or nine months, that has now led us to that beautiful stock price quote at the top of this post.

Talk about a true real life donkey. Somebody get this guy a poker blog right away please.