Posts belonging to Category Lehman Brothers

Structured Products Pose Major Risks for Investors


Danger lies ahead for investors in structured products. Structured products were once used only by institutions and sophisticated investors that had the education, training and experience needed to fully understand these complex and opaque alternative investments.  Over the past several years, however, structured products have been sold to individual investors, who do not understand the […]

Wall Street Firms Refuse to Disclose Exposure to European Debt


JP Morgan Chase and Goldman Sachs have sold credit default swaps that put them on the hook for $5 trillion of debt ? but they won’t say whose debt they are on the hook for. That leaves investors worried that it may be debt issued by Greece, Italy, Ireland, Portugal and/or Spain. Greece and Italy […]

Investors Should Be Leading The ‘Occupy Wall Street’ Charge


Many investors have reason to support the Occupy Wall Street movement that objects to Wall Street greed. These investors have seen their hard-earned money dissipate in the hands of their “trusted financial professionals.”

Market Risks Continue to Grow


MarketWatch is reporting a prediction by John Stephenson, senior vice president of First Asset Management in Toronto, that a new, Lehman-like financial crisis will occur in the next six to twelve months, this time involving the debt of government and European banks. Mr. Stephenson predicts that stocks will fall to levels that existed just after […]

Have the Equity Markets Become Too Risky for Most Retail Investors?


Investors withdrew net $23.5 billion from U.S. equity mutual funds as of Aug. 10, the most since October 2008, following the Lehman Brothers bankruptcy, according to a recent InvestmentNews article entitled “Equity investors exiting — and may not be back for years.”.

Lehman Sues Brokers to Recoup Bonuses – Confirms that Consummate Corporate Arrogance Knows No Bounds


Lehman Brothers is filing arbitration claims to recover recruitment and retention bonuses paid to brokers based on the premise that they are loans that have to be repaid if the broker’s employment was terminated for any reason. So far, Lehman has been successful as arbitration panels have awarded Lehman clawbacks of $2.2 million against one […]

Reverse Convertible Securities More Likely to Become Toxic as Market Swoons


The current free fall in the stock market is likely to activated the ticking time bombs that are hidden away in some investors’ portfolios. These time bombs are embedded in a type of structured product called Reverse Convertible Notes or Reverse Exchangeable Notes. The problem has to do with the way these products are structured.

FINRA Warns Investors about Structured Products and Other Non-Conventional Securities


The Financial Industry Regulatory Authority (FINRA) has issued an investor alert warning against chasing yield with structured products, junk bonds and floating-rate bank-loan funds. The alert was prompted by “significant recent inflows” into high-yield products. Investors may find enhanced yields attractive in the current market environment of low yields on conventional fixed-income investments and higher […]

SEC Refuses to Take Action Against Senior Executives in Structured Product Cases


SEC Enforcement Chief Robert Khuzami recently stated that the SEC’s decision not to charge top executives of Wall Street banks with wrongdoing in cases involving structured products was appropriate, according to Suzanne Barlyn’s Wall Street Journal article entitled “SEC: Structured-Product Cases Haven’t Reached Top Bank Officers.” According to Mr. Khuzami, top executives were not involved […]

The Subprime Mortgage Mess: How the American Dream Turned into a Nightmare


Best-selling “Reckless Endangerment: How Outsized Ambition, Greed, and Corruption Led To Economic Armegeddon,” by Gretchen Morgenson and Joshua Rosner, “calls out greedy guys behind mortgage mess,” according to a USA Today book review by Kathryn Caravan. See also “Home Truths,” by James Freeman of the Wall Street Journal. Both reviews provide examples of how the […]