The option market now thinks Lehman Brothers (LEH) has almost as a high a chance of going bust as Bear Stearns, OptionMonster’s Jon Najarian tells the NY Post:
“Traders’ perception of risk is three times higher than [Lehman’s] peers and is approaching the same level as when Bear Stearns collapsed,” Najarian said.
Which gives the firm another reason to run to Korea or China for capital.
Remember that what killed Bear wasn’t the crap piled on its balance sheet–it was the fear of the crap piled on its balance sheet, which caused Bear clients to run for the hills. Lehman can hit the Fed Discount window that Bear couldn’t, which should enable it to roll its short-term paper. But if the firm’s clients start running for the exits, Lehman’s business will be destroyed.
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