Wallstreet Shaken As Lehman Collapses

Posted by admin

September 15, 2008

The collapse of Lehman Brothers lead to a Dow Jones fall of 500 points - the worst one-day loss in over 6 years, reported the Times Online. With Lehman crumbling into bankruptcy, AIG’s prospects looked dim were it not for a $20bn bailout.

Following the Dow’s plunge S & P’s 500 Index also fell by 58.74 points. AIG was one of the hardest hit financial companies with a 60.8% drop while Bank of America took less damage with a 21% decrease. Meanwhile, in London the FTSE 100 finished at 3.9% down as the UK’s largest mortgage lender Halifax Bank of Scotland’s shares dipped 17.5% to 232.75p.

Speaking of shares, the once formidable US Insurance giant AIG failed to release updates about its financial future in a timely manner leading to a dramatic decrease in share values to $5.99, a drop of 50%. Financial rescue came by way of the New York Governor David Paterson who signed an agreement to free $20bn from the balance sheets of New York authorities.

Earlier Monday morning Lehman Brothers filed for Chapter 11 bankruptcy protection from creditors while across the pond the Bank of England and the European Central Bank injected some £30bn into financial markets to quell any potential panic.

The BoE produced £5bn in short-term funding as a protective measure in case banks were too cautious to lend to each other following the wake of the Lehman Brothers’ collapse.

Read the source

Other ways to find this page: aiginsurance, lehmanbrothers, collapse, wallstreetdowjones

Share and Enjoy: