Investment Banks

All the big boys post perfect trading quarters.

Bank of America, Citibank, JP Morgan and Goldman all report perfect trading quarters. How hard is that ? Didn’t I read somewhere that in the history of baseball, only 19 perfect games had been pitched?The full story, here.

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Rearview mirror revelations on Lehman games ….Repo 105

In repo transactions, the asset sold continues to reside on the seller’s balance sheet since it is going to be repurchased soon anyway. Lehman took them off the balance sheet at the end of a quarter, used the proceeds to pay off debt so that it looked less leveraged at that time. Soon after the quarterly report, cash was borrowed, the asset repurchased and put back on the books. Apparently they thought they could do this since they were selling the asset for less than it was worth (taking $100 on an asset worth $105)… See page 733 of the examiner’s report here.