Merrill Lynch has $966 billion in assets and $931 billion in liabilities. They are counterparty to $4.2 trillion in derivatives trades. They get brownie points for including HTML anchors in their 10-Q.

From How big are Merrill, Lehman and AIG?

And we still don't know how much toxic waste is being hidden both on the books (marked to fantasy) and off the books.

Now that Hank the Hammer's bazooka has misfired, looks like they'll be firing up Ben's helicopters.

AIG Struggling To Stay Alive, Begs Fed For Cash

(18 mins ago)
The Hong Kong Standard

Merrill Lynch, JPMorgan Chase and Bank of America Corp. are part of a group of 10 firms providing a total of US$70 billion (HK$546 billion) for a US borrowing facility aimed at providing liquidity.

Other firms participating are Barclays, Citigroup, Credit Suisse Group, Deutsche Bank, Goldman Sachs Group, Morgan Stanley and UBS, a joint statement said.

WSJ
By DENNIS K. BERMAN, JON HILSENRATH and DEBORAH SOLOMON
September 14, 2008 9:19 p.m.

The Federal Reserve is expected to expand its lending facilities in the wake of the likely demise of Lehman Brothers, taking a wider array of securities, including equities, as collateral for its loans, say people familiar with the matter.

The moves, which potentially represent another landmark step in the Fed's efforts to address the deepening credit crisis, are expected to be temporary. They are meant to calm markets as they head into one of the most perilous trading environments in decades with Lehman's massive market positions on the verge of being unwound.

The Fed has already dramatically expanded its lending facilities in the past few months. Most notably, after the collapse of Bear Stearns in March, it said it would make short-term emergency loans to investment banks under a lending facility called the Primary Dealer Credit Facility.

As of Wednesday, no firms had used the facility since July, but amidst the uncertainty created by the likely demise of Lehman Brothers and the possible takeover of Merrill Lynch by Bank of America, there could be a rush to borrow from the Fed as trading resumes Monday. Bankers say the unwinding of Lehman Brothers' many trading positions could also create a large need for short-term funds.

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* Jill Treanor
* The Guardian,
* Monday September 15 2008
* Article history

In the two decades since Tom Wolfe described the investment bankers on Wall Street as self-styled "masters of the universe", that sense of invincibility has only grown. Until now.

The decline of first Bear Stearns and now Lehman Brothers and the concern surrounding Merrill Lynch has been a rude awakening. Wall Street, which had survived the bursting of the technology bubble and the slew of Enron-related scandals with little more than a bloodied nose, is no longer a one-way bet.

Richard Fuld, Lehman's chief executive, refused to think the unthinkable when he told investors last Wednesday that the bank would come through the crisis and presented a survival plan.

But Wall Street was not convinced. Such is the nervousness fuelled by the credit crisis, and the apparent vulnerability of the once indomitable firm, that it took just another day for him to realise that Lehman needed to find a buyer. Shares in the bank, which were at $66 in February, before the Bear Stearns near collapse, closed on Friday at just $3.65 after a brutal week of selling.

These will be anxious times for Lehman staff who left work on Friday, not knowing if they would have a job to return to today. The firm employs 26,000 people worldwide. The job market has already been flooded with former staff at Bear Stearns, and few banks are hiring. Lehman had already let 1,500 go during the third quarter, in an effort to cut costs.

The fall of Lehman Brothers marks an ignominious end for one of the oldest names on Wall Street. The investment bank was founded in 1850 and run by three brothers who began trading cotton in Alabama and moved to New York to take advantage of the burgeoning financial markets. The first initial public offering they underwrote was the International Steam Pump Company, in 1889.

so much for legacy
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As of this post, DJIA futures down 326

Will we see a 10,000 Dow this week?

UPDATE: COB MondayWe're on our way! DJIA down a stunning 504.48 to 10,918. When was the last time the Dow was at this level?

Be prepared for more carnage when the Nikkei opens for business tomorrow after a long weekend.

Lehman, Merrill - even Goldman - got levered up to their eyeballs during the boom. Now they, and the rest of us, are paying the price.
By Colin Barr, senior writer
September 14, 2008: 11:07 PM EDT
CNN

NEW YORK (Fortune) -- In the end, the weight of the housing collapse was too much for the weaker players in an over-leveraged U.S. financial sector to bear.

Sunday evening brought ominous tidings. Lehman Brothers is likely to be liquidated after officials at the Federal Reserve and Treasury failed to line up a buyer. But what's likely to be more distressing for investors around the globe are the reports that Lehman is far from the only U.S. financial titan that stands in need of help.

more with history lesson