Commentary on the economy, the markets, and business

Do you want to buy Lehman Brothers?

Bess Levin at Dealbreaker suggests we all get together and buy Lehman Brothers for Maria Bartiromo, because it's her birthday.

Barry Ritholtz has a screengrab of the Craigslist ad offering "Free! Bulge Bracket Investment Bank (Midtown West)." Sadly, the original has been flagged for removal.

And from the wires you can get all the far less interesting rumors about potential suitors (or not) like Bank of America, Goldman Sachs, Nomura, HSBC, Barclays, etc.

Lehman's market cap, as of today's close, was $2.9 billion. You could sell the headquarters building for about $1.3 billion, which leaves $1.6 billion for all the rest of the business. That's still slightly out of my price range, but it strikes me as a reasonably good deal for a company that, even after you subtract the $6.6 billion in losses over the past two quarters, made an average profit of $1.8 billion a year for the past five years.

So why hasn't anybody bought it yet?

1) They're worried about much bigger losses looming in Lehman's balance sheet.

2) They're just not in a buying mood. In fact, they're in a crawl-under-their-desks-and-wait-until-all-this-over mood.

3) They have no idea what an investment bank with no consumer franchise is worth anymore. (It's not like there's a large comparison group.)

4) They're playing chicken with the Fed, hoping they can arrange a backstop like the one JP Morgan Chase got when it bought Bear Stearns. (A backstop the Fed really doesn't want to extend.)

5) They've heard Maria Bartiromo already has an investment bank. (Which she doesn't, by the way. Her husband runs a family of exchange-traded funds, but that's really not the same.)

Am I missing anything?

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    Hey, just as an aside, why can't we get the Money Honey (Maria) to run for president? She is far and away better looking than Palin and she is a ton smarter.

    By the way, you do know the real problem with Lehman right? :-) [a bit of speculation here]

    I hear from DC staffer friends that the Fed and Treasury are under serious pressure (Read: the highest levels) to quit bailing folks out unless it is Absolutely Necessary. Period.

    Besides, Lehman will be divided up into bite-size chunks and everybody will be forced to take a bite. I believe that is the CW.

    I just love how all of the seniors are finally starting to freak out about the economy (mom and dad included). They are just realizing that until housing hits a floor, pensions (George Will wrote about it today), banks, and businesses (Nancy P. is supposedly got a deal for the car companies - provided they consolidate) in general are really in a jam.

    All in all, the economy is not that bad, but in earnest, this country hasn't been so economically destabilized since the Great Depression. Seriously.

    Well, with that, I'm hunkering down...both from Ike and the market. I've got a couple of cases of beer at the house, some patents to draft for some clients, and some friends in town running from the coast. I'm long on the market believe it or not. Just sunk another $10k into my favorite index for the fun of it...want to see if it is worth anything when I need it in 30 years. Oh well, it's just money and lawyers never really retire I hear.

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