I think this pretty much sums up the problems with Wall Street. Here’s the article
NEW YORK (Reuters) – Lehman Brothers Holdings Inc, an investment bank beset by rumors of not having enough funding, said it plans to raise $3 billion of capital to quash questions about its stability.
Lehman’s shares fell 2.8 percent to $36.60 in after-market trading after the planned convertible preferred share offer was announced, since it could result in more shares being issued.
How in the world does this make it more stable. Having the ability to raise more capital is just as important as actually having it. In this case it may be better because if you don’t have it in hand you’re not as likely to invest $1 billion dollars in the “Coke Rewards” bottle cap hedge. Or go $2 billion long on all restaurants that end with the sound of “E”.