Lehman Employees Still Expected To Show Up Tomorrow

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We've received a bunch of calls and e-mails from Lehman Brothers employees asking if they should report to work tomorrow. We think you all deserve the day off but obviously we aren't the ones making the decisions here. Various teams have been contacted by their supervisors in the last couple hours and told yes, they still need to come. Here's one from the IT guys.

From: Gopalkrishnan , Hari (Technology)
Sent: Sun Sep 14 19:51:49 2008
Subject: Business Support for Monday
Given the recent press reports regarding Lehman, I wanted to communicate that we are counting on you to be at work on Monday and ready for business as usual. In fact, I ask that you take the extra time necessary to coordinate with your teams to conduct a "ready for business" check on all mission critical activities before the day begins. As I learn more, I will communicate with you.
Thanks as always for your commitment.


Facebook Will Take Free Money From Banks But Don't Expect It To Show Any Gratitude

The Wall Street Journal today discovered that universal banks that lend money to companies for cheap tend to want investment banking business in return for that lending and I guess that's a scandal: As the market for technology IPOs revs up and the biggest banks seek to capitalize on the size of their balance sheets, the practice of selecting underwriters that also provided loans is coming under focus, spurred by Facebook's IPO process. Critics of the practice say the choices aren't accidental and reflect the "you-scratch-my-back-I-scratch-yours" way that Wall Street works. Bankers, for their part, say they aren't allowed to make loans on the condition that they receive other business, but borrowers can use the loans as a factor in choosing underwriters. Some bankers say that lending is just one of the many services they offer companies. At Facebook, the credit line played a role in the batting order for underwriters, said a banker who worked on an underwriting pitch to the company. When I was young and naive and pitching for underwriting business against banks that did lots of lending, I always thought that banks "aren't allowed to make loans on the condition that they receive other business, but borrowers can use the loans as a factor in choosing underwriters" thing was ripe for a scandal. I still sort of think that: I just do not believe that no client coverage banker has ever said "we'll be in your credit facility but only if you promise us underwriting or M&A business." (Some people agree with me!) And, as the Journal notes, that would be a criminal violation of the antitrust laws, which is unspeakably weird but there you go. But if you ask a banker who has been carefully and recently briefed on anti-tying regulations, he will probably tell you something like "we don't demand underwriting business to provide a loan. Companies demand loans to get underwriting business." And, as the Journal says, that's not illegal.