Stock Market Information

With the ban of short selling on 800 financial stocks and the Federal Reserve’s efforts to provide funds for banks across the nation, many in the industry are wondering what that means exactly for the future of banks and why the government didn’t step in sooner. Lehman brothers in particular, has to be wondering why the Fed didn’t step in and prevent them from going on. Here are a number of considerations from a recent article at Yahoo! Finance

• Will Merrill Lynch try to get out of its agreement with Bank of America?
• Does Morgan Stanley proceed with its talks with Wachovia (and others)?
• Does Washington Mutual still need a buyer?
• Does Lehman’s Dick Fuld have a right to be bitter this government action didn’t come a week sooner?

It also means that a number of buyout offers that were being considered previously may no longer happen. Does Merril Lynch really need to sell to BAC if they can get the funding they need from the Fed? It’s unlikely that they’ll be able to back out of the deal of course, though there is a termination clause of some kind in the purchase deal. The Fed could also help struggling Washington Mutual at some point along the way.