Goldman Sachs & Lehman Brothers; Falling Further Into A Rabbit Hole
Goldman Sachs, the world's biggest securities firm by market value,
said net income fell 53% to $1.51 billion. Revenue from fixed-income, currencies and commodities, Goldman's biggest division, fell 32%.
Goldman's overall net revenue dropped 35% to $8.3 billion in Q1, its biggest decline since the firm went public in 1999.
Reduced by $1 billion of writedowns for high-yield loans.
The fixed income business posted about $1 billion of losses on residential mortgages and securities, as well as a $1 billion loss on high-yield, or leveraged, loans.
The firm's principal investments division reported a loss of $532 million, led by a $135 million decline
in the value of its stake in Beijing based Industrial & Commercial Bank of China Ltd.
Lehman Brothers, the fourth-biggest U.S. securities firm, reported today that Q1 profit fell 57%.
Net income declined to $489 million vs $1.15 billion. Total revenue fell 31% to $3.5 billion.
Earnings were depressed by a $1.8 billion writedown caused by the slump in the mortgage market.
Reducing the value of those assets pushed fixed-income revenue 88% lower, to $262 million.
Commercial mortgage-related assets caused $700 million of the writedowns last quarter.
An additional $800 million came from residential home loans and securities tied to them.
Regarding liquidity issues, Lehman had $30 billion of cash and $64 billion in assets that could easily be turned into cash as of yesterday,
The Nattering One muses... both Lehman & Goldman with 57% & 52% profit declines, and net revenue declines of 35% & 31%
posting absolutely DISMAL results compared with last year. Meanwhile PPI & housing reports were dismal, meaning the situation is getting worse.
But the losses and declines were less than expected, and the CEO's, much like Bear Stearns said, we are solvent, and it is good...
so once again "intelligent" investors, much like Alice in Wonderland trusted the Madhatters words while warping and twisting the obviously pathetic results.
The market cheered DJIA +295; SP500 +38, as delusional investors poured good money, down the rabbit hole, after bad.
Don't expect this bounce to last long, its simple math. More layoffs, more defaults,
more downgrades, more writedowns, more losses, and more price declines for stocks & real estate.
said net income fell 53% to $1.51 billion. Revenue from fixed-income, currencies and commodities, Goldman's biggest division, fell 32%.
Goldman's overall net revenue dropped 35% to $8.3 billion in Q1, its biggest decline since the firm went public in 1999.
Reduced by $1 billion of writedowns for high-yield loans.
The fixed income business posted about $1 billion of losses on residential mortgages and securities, as well as a $1 billion loss on high-yield, or leveraged, loans.
The firm's principal investments division reported a loss of $532 million, led by a $135 million decline
in the value of its stake in Beijing based Industrial & Commercial Bank of China Ltd.
Lehman Brothers, the fourth-biggest U.S. securities firm, reported today that Q1 profit fell 57%.
Net income declined to $489 million vs $1.15 billion. Total revenue fell 31% to $3.5 billion.
Earnings were depressed by a $1.8 billion writedown caused by the slump in the mortgage market.
Reducing the value of those assets pushed fixed-income revenue 88% lower, to $262 million.
Commercial mortgage-related assets caused $700 million of the writedowns last quarter.
An additional $800 million came from residential home loans and securities tied to them.
Regarding liquidity issues, Lehman had $30 billion of cash and $64 billion in assets that could easily be turned into cash as of yesterday,
The Nattering One muses... both Lehman & Goldman with 57% & 52% profit declines, and net revenue declines of 35% & 31%
posting absolutely DISMAL results compared with last year. Meanwhile PPI & housing reports were dismal, meaning the situation is getting worse.
But the losses and declines were less than expected, and the CEO's, much like Bear Stearns said, we are solvent, and it is good...
so once again "intelligent" investors, much like Alice in Wonderland trusted the Madhatters words while warping and twisting the obviously pathetic results.
The market cheered DJIA +295; SP500 +38, as delusional investors poured good money, down the rabbit hole, after bad.
Don't expect this bounce to last long, its simple math. More layoffs, more defaults,
more downgrades, more writedowns, more losses, and more price declines for stocks & real estate.
Comments
ROFLMAO. Found this at minyanville, and thought you might enjoy it.
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