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fixing summaries and creating narratives

Page history last edited by sandra jamieson 13 years, 10 months ago

Below is a collection of summaries about the current financial situation. This is called an annotated bibliography. The entries start on September 13 and end on September 23. Over that ten day period, a lot happened. Your task is to

  1. check the summaries to make sure they are correct
  2. organize them--these are organized chronologically, but they could be organized by topic
  3. create an outline for a narrative whose purpose is simply to summarize what happened--not to comment on it. (Your task is to explain the who, what, when, where, and how of things). This kind of writing is known as synthesis, and it should be as objective as possible--just reporting the events as your sources presented them. It is due on Friday. This paper must be free of opinion.

     the NEXT paper, paper #3 (due on Monday) invites an argument (answering the question why? or what next? for example).


 

Annotated bibliography of sources in the September 2008 financial crisis

"Lehman Expected to File for Bankruptcy Protection"

By Eric Dash, Ben White and Michael J. de la Merced

New York Times

http://dealbooks.blogs.nytimes.com/2008/09/14/lehman-to-file-for-bankruptcy-protection/?scp=2&sq=Lehman%20Brother%20Bankruptcy&st=cse

September 14, 2008

September 21, 2008

          Lehman Brothers will file for bankruptcy protection Sunday night, in the largest failure of an investment bank since Drexel Durnham Lambert 18 years ago.  Lehman will look to place its parent company, Lehman Brothers Holdings, into bankruptcy protection, while their subsidiaries will remain solvent.  A collection of banks will provide a financial fall back to help provide an orderly winding down of the 158-year-old investment bank.  As the Federal Reserve has agreed to accept lower-quality assets in return for loans from the government.  Due to the stricter treatment that federal bankruptcy law applies to financial-services firm, Lehman cannot hope to reorganize and survive, instead they will have to liquidate its holdings.  Lehman's broker-deal subsidiaries would not be a part of the bankruptcy filing.  Lehman has chosen the law firm of Weil, Gotshal & Manges to prepare it's bankruptcy filing.  The firm's leader, Harvey Miller, also worked on Drexel's bankruptcy case back in 1990.

-Chris Pumphrey

 

“Lehman Files for Bankruptcy; Merrill Is Sold”

By Andrew Ross Sorkin

The New York Times

http://www.nytimes.com/2008/09/15/business/15lehman.html?pagewanted=2&sq=the%20lehman%20brothers&st=cse&scp=1

September 15, 2008

September 21, 2008

            Merrill Lynch decided to sell itself to Bank of America for around 50 billion so that they would avoid even bigger financial problems; Lehman Brothers had to file for bankruptcy because they could not find a buyer. Lehman Brothers was told that the government was not going to bail them out, but they still could not find a buyer. Since two companies were in trouble time will only tell what will happen to other firms such as A.I.G. A.I.G. needed money from the Federal Reserve so that they would not end up like the rest. This Wall Street crisis has seen to be the biggest failure in 18 yrs. A big component is what is going to happen to all of the employees who are now out of work; this is seen to have a huge impact on New York City’s economy. The Fed, working on the emergency loan for Wall Street could put taxpayers at risk.

-Kathryn Kozma

 

“Life after Lehman Brothers”

By Ben White and Michael M. Grynbaum

The New York Times

http://www.nytimes.com/2008/09/16/business/16lehman.html?_r=1&sq=Lehman%20Brothers&st=cse&adxnnl=1&oref=slogin&scp=2&adxnnlx=1222128161-JrWi2pYiBidYeeV3onWaxg&pagewanted=print

September 16, 2008

September 22, 2008

Lehman Brothers tried hard to find a buyer because they knew that things were not going well. Lehman Brothers tried to make deals with multiple companies such as Bank of America and Barclays but they would not make deals unless they had support from the government. 25,000 Lehman Brothers employees found out about the filing for bankruptcy from the press not by the company. The 158 year old investment bank was now being controlled by the bankruptcy administration. Many people criticize Mr. Fuld (the bank’s chief executive) because they believed that he waited too long to find a buyer. If he looked faster he would have found a buyer. Now Lehman Brothers employees do not know what to do with themselves, and they had to face the press which was camped outside the only exit.

-Kathryn Kozma

 

"Fed's $85 Billion Loan Rescues Insurer"

By Edmund L. Andrews

The New York Times

http://www.nytimes.com/2008/09/17/business/117insure.html

September 16, 2008

September 20, 2008

Tuesday the Federal Reserve agreed to an $85 billion bailout that would give the government control of the insurance company A.I.G.  With time running short after A.I.G. failed to get a loan from the bank to avoid bankruptcy, Treasury Secretary Henry M. Paulson Jr. and the Fed chairman, Ben S. Bernanke, called for a meeting with both the House and Senate leaders on Capitol Hill.  The bailout is expecting to prove controversial, because it put taxpayer money at risk while protecting bad investments made by A.I.G. along with ones made by it's business partners.  What scared the government the most was the fact that A.I.G. played a big role as an enormous provider of esoteric financial insurance contracts to investors.  A.I.G. was required to cover it's losses suffered by the buyers in the case that the securities had defaulted.  Financial markets, who worried over A.I.G.'s possible collapse and Lehman Brothers bankruptcy, reacted relieved when they heard the news about the bailout.  The move will likely strike up much debate in the upcoming presidential election as to who is to blame.

-Chris Pumphrey

 

 “DBRS lowers outlook on Morgan Stanley, Goldman ratings”

Reporting by Ciara Linnane; Additional reporting by Dena Aubin, Editing by Chizu Nomiyama

Rueters

http://www.reuters.com/article/rbssFinancialServicesAndRealEstateNews/idUSN1751866920080917

Wed Sep 17, 2008

Morgan Stanley and Goldman Stachs rating have fallen from ‘stable’ to ‘negative.’ The fall was due to the crisis in the global financial market of the past weeks, which could destroy their earnings.

-Anne Daniels

 

“Markets Soar, But New Rules Upset Traders”

By Vikas Bajaj, Andrew Ross Sorkin and Michael J. de la Merced

New York Times

http://www.nytimes.com/2008/09/20/business/worldbusiness/20markets.html?_r=1&scp=6&sq=stocks&st=cse&oref=login

Published Sept. 18 2008. I read it on Sept. 19 at 7:26 P.M.

Many of the stocks that are said to be “junk bonds” began to soar. The treasuries where people trust in their money has began to plunge. The government banned short selling because they felt people were cheating the system. This gave rise to a big controversy, because some people were for short selling and some were not.

-Jeremy Appledorf

 

 “$700 Billion Is Sought for Wall Street in Vast Bailout”

David M. Herszenhorn

New York Times online

http://www.nytimes.com/2008/09/21/business/21cong.html?_r=1&ref=us&oref=slogin

Published September 20, 2008

Date I accessed it was September 21, 2008 12:30 pm

The number of home mortgages not being paid back has increased substantially and lead to the failure of several major financial institutions.  Two major mortgage banks, Fannie Mae and Freddie Mac, were taken over by the government to keep them from falling.  AIG, American International Group, is one of the largest insurance companies in the world and was granted a loan of 85 billion dollars from the federal government.  The article focuses on a proposal for a short term fix suggested by the administration.  The idea is to enable the secretary of treasury to buy and sell mortgage debt.  The government would buy the bad mortgages and give them a value so that banks can continue to make loans.  Most of the article deals with criticisms voiced by congressional democrats who plan to oppose the proposal unless it includes an economic stimulus package that for “ordinary Americans”.    

 –Callie Corro

 

“Shift for Goldman and Morgan Marks the End of an Era”

By Andrew Ross Sorkin and Vikas Bajaj

New York Times

http://www.nytimes.com/2008/09/22/business/22bank.html?hp

Published: September 21, 2008

According to the Federal Reserve this Saturday Goldman and Morgan, the last two independent investment banks, will now  become bank holding companies. This is opposed to the big independent investment banks they once were on Wall Street. This move will cause them to have tighter regulations and to be closely watched by the government agency bank examiners.  The firms will now look more like commercial banks, with more disclosure, higher capital reserves and less risk-taking. Before this change these two firms used enormous amounts of debt to their own advantage and grew by making bold bets.

-Anne Daniels

 

"Goldman to Raise $7.5 Billion"

By: Ben White

New York Times online

http://www.nytimes.com/2008/09/24/business/24goldman.html

Published: September 23, 2008

Viewed: September 23, 2008 6:40pm

Warren E. Buffet is going to invest $5 billion dollars in Goldman Sachs, as part of an effort to raise fresh capital for the investment firm.  Another $2.5 billion dollars will also come from common shares in the company.  This move came after investment firm Morgan Stanley raised $8 billion by selling part of its shares in Mitsubishi, the largest bank in Japan.  After a brief stand off both firms eventually were pressured into becoming regulated bank holding companies when the market worsened.  The days of "big money" on Wall Street seem to becoming to an end.

-Andrew T. Buchanan

 

Bush Urges Democrats to Act Quickly on Bailout Plan

Reported by David M. Herszenhorn, Stephen Labaton and Mark Landler, and written by Mr. Labaton.

http://www.nytimes.com/2008/09/23/business/23paulson.html?hp

     This article is about congress writing a bill to help bailout the major businesses on wall street that have just gone bankrupt threatening America's economy.  As you can see by the title President Bush is urging Democrats in congress to hurry up with writing the bill.  The promblem is the Smarter Democrates want to add provisions to the bill and not just give money so this type of thing wont happen again. What  the Democrates want to revise is " $700 billion bailout package must include greater legislative oversight of the Treasury Department, more direct assistance for homeowners and limits on the pay of top executives whose firms seek help".  President Bush response to the Democrates wanting to add more revisions to the bill was that this would  “would undermine the effectiveness of the plan”.  This is an extremly serious situation that threatens not only the economy of the U.S. but also a finicial crisis globally.  Of course this bailout needs to happen in the extreme near furture but there is no point of just bailing out the companies without putting some rules and regualtions in place so this wont happen again.

- Zandy Bard

 

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