tag:blogger.com,1999:blog-30643134.post6656229898825802231..comments2023-12-26T01:10:26.319-05:00Comments on Accrued Interest: Lehman Brothers: Destructive power greater than half the starfleetAccrued Interesthttp://www.blogger.com/profile/05096191765979971184noreply@blogger.comBlogger9125tag:blogger.com,1999:blog-30643134.post-39815771949688471022008-09-15T01:41:00.000-05:002008-09-15T01:41:00.000-05:00This is what I think: Lehman Brothers BankruptcyThis is what I think: <A HREF="http://mostpopularinusa.blogspot.com/2008/09/lehman-brothers-bankruptcy.html" REL="nofollow">Lehman Brothers Bankruptcy</A>Chushttps://www.blogger.com/profile/13669218468698857210noreply@blogger.comtag:blogger.com,1999:blog-30643134.post-69712363990088751532008-06-05T10:22:00.000-05:002008-06-05T10:22:00.000-05:00Automatic 10b-5 plan must be the answer because ot...Automatic 10b-5 plan must be the answer because otherwise it's clearly insider trading, even if it's done by the company and not an insider. The whole idea of 10b-5 plans is to strip the entity/person using it from discretion to time purchases/sales. A shareholder who sold its shares back to the company when the company has material non-public information has been defrauded just as if it sold to an insider who is buying on inside info. the beneficiary may be all other shareholders, but that's irrelevant, as it is the unfairness to the seller that is the issue because the buyer has inside info. of course, it's lunacy anyway to think that insiders who buy or sell during permitted windows don't have inside info, it's just that it's become the custom to permit such transactions so long as it's tied to a recent earnings release (and thus not much presumably has transpired from the most recent earnings announcement). i highly dobut leh is breaking the rules here. now whether the buys are sensible is another thing, but it's all a confidence game at this point.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-30643134.post-12172949790861704882008-06-04T14:48:00.000-05:002008-06-04T14:48:00.000-05:00It's an agreed principle that a company cannot be ...It's an agreed principle that a company cannot be its own insider. A company always acts on insider information. Anything else wouldn't make a lot of sense...Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-30643134.post-18078118385540313012008-06-04T14:21:00.000-05:002008-06-04T14:21:00.000-05:00I'm hearing that it was normal buying to offset op...I'm hearing that it was normal buying to offset options grants. Much more boring than I had hoped!Accrued Interesthttps://www.blogger.com/profile/05096191765979971184noreply@blogger.comtag:blogger.com,1999:blog-30643134.post-61388881337665781842008-06-04T10:37:00.000-05:002008-06-04T10:37:00.000-05:00I'm pretty certain that Lehman almost always has a...I'm pretty certain that Lehman almost always has a buyback authorized... I don't think it is a smart way to run an investment bank, but maximizing ROE is a religion to many.<BR/><BR/>Not perfectly certain on the insider trading, but if the buyback is authorized by the board, and done within the parameters that the board has set, then I think that The Epicurean Dealmaker has it right... the buyback affects all shareholders equally.David Merkelhttps://www.blogger.com/profile/05073877918072914309noreply@blogger.comtag:blogger.com,1999:blog-30643134.post-42857133037780033322008-06-04T10:17:00.000-05:002008-06-04T10:17:00.000-05:00Just to clarify what acoors wrote, the 10b5-1 plan...Just to clarify what acoors wrote, the 10b5-1 plan sets trading limits to be executed close to automatically by the firm's trader (which I assume would be an external brokerage) between the close of the most recent quarterly books (5/31) and the earnings call (which I believe is sched for the week of 6/16). <BR/><BR/>One other comment is that these pre-set 10b5-1 instructions would be set right after quarter-end so Lehman could have set aggressive repurchase targets in the recent past.jult52https://www.blogger.com/profile/13833751348979987747noreply@blogger.comtag:blogger.com,1999:blog-30643134.post-23716289718225002132008-06-04T09:40:00.000-05:002008-06-04T09:40:00.000-05:00If they have an existing 10b5-1 plan they can buy ...If they have an existing 10b5-1 plan they can buy stock at any time. Presumably they set up a buyback matrix shortly after releasing earnings and then automatically buyback shares when prices fall. This is the way corporations buyback shares regardless of insider information.Anonymousnoreply@blogger.comtag:blogger.com,1999:blog-30643134.post-76870253587690398872008-06-04T08:28:00.000-05:002008-06-04T08:28:00.000-05:00Strange b/c whenever we do basket trades against o...Strange b/c whenever we do basket trades against other banks they can never trade their own name. For example if we swap and S&P500 basket against Citi, we will have to get the Citi shares ourselves. They are always restricted by compliance. <BR/><BR/>It does seem strange. Don't they have to do an official buyback to buy shares?JoshKhttps://www.blogger.com/profile/17028441526311718240noreply@blogger.comtag:blogger.com,1999:blog-30643134.post-85610483563670085282008-06-04T08:15:00.000-05:002008-06-04T08:15:00.000-05:00Let one thousand lawyers opine, but in my understa...Let one thousand lawyers opine, but in my understanding insider trading only applies to individuals who might profit differentially from inside information. The spirit of the idea is that they are using information asymmetry to profit at the expense of outsiders.<BR/><BR/>The company, on the other hand, does what it does for the benefit of all shareholders. The only harm or potential harm is to people who are not shareholders (who miss a buying opportunity?) or people who sell shares to the company (and somehow miss further appreciation, e.g.). But these people by definition are no longer/not shareholders, and the company has no obligation to them. Furthermore, LEH is sending a strong signal to all current and potential shareholders with its buying, which constitutes allowed investor communication.<BR/><BR/>Whether you believe whatever signal they are sending or not is another matter.The Epicurean Dealmakerhttps://www.blogger.com/profile/06590492610853256232noreply@blogger.com