Distress at Lehman

One firm that may be closer to collapse than even Washington Mutual is Lehman Brothers. For the past few days there has been news of imminent collapse without a bailout or takeover due to capitalization problems from mortgage-related loses. Now, if the Treasury Department via Fannie Mae or Freddie Mac is willing to exchange their mortgage securities for T-Bills, then cries of desperation around Lehman Brothers may be overstated, and they might be a good buy at the right price.