The credit crunch takes a double toll.
Lehman Brothers, the New York headquartered global financial services group founded in 1850, has collapsed. The firm filed a petition under Chapter 11 of the US Bankrupcy Code to protect its assets from creditors, yesterday. See www.lehman.com for more information.
The US icon owes in the region of US$157bn to its 10 largest creditors alone.
The second victim announced yesterday was the giant Merrill Lynch, the Delaware firm founded by Charles E Merrill and Edmund C Lynch in 1915.
Merrill Lynch has been forced to right down more than US$40bn over the last year due to the credit crunch caused by the collapse of the sub-prime homeloan market in the US. Bank of America, arguably America’s oldest banking group with a related history going right back to 1784, yesterday announced its acquisition of Merrill Lynch for around US$50bn. See www.ml.com and www.bankofamerica.com for more information.
This is how the major indices ended on Monday the 15th after this news:
DJIA -4.4%, closing at 10917.51
NASDAQ Comp -3.6%, closing at 2179.91
S&P500 -4.7%, closing at 1192.70
Russell 3000 – 4.7%, closing at 696.31
FTSE -3.92%, closing at 5204.20
DAX -2.74%, closing at 6064.16
CAC 40 -3.78%, closing at 4168.97
NIKKEI 225 -4.95%, closing at 11609.72
Shanghai Comp -4.18%, closing at 1992.76
JSE Alsi -2%, closing at 25,642
