Friday, September 12, 2008

Secondary Market: Lehman 6 Month Notes Priced to Yield 34%

Just to see if investors were buying Lehman bonds in anticipation of a deal this weekend - with some anticipation that the debt holders would be made whole - I checked some of the bond pricing in the secondary market (offered for resale, not by Lehman).

The 6 month Lehman Brothers notes due March 13, 2009 are being offered at a yield to maturity (annualized) of 34%.

The one year senior notes due August 15, 2009 are being offered at a yield to maturity of 36%.

I'd say debt investors are not sanguine.