Second, Lehman (or any other company that has failed during this crisis) was not brought down by short sellers of stock or buyers of CDS. It failed because it was insolvent and the government did not step in to save them. The same thing would have happened to many other banks if the government hadn’t subsequently stepped in to throw trillions of dollars at the problem with direct capital infusions, debt guarantees, zero interest rates, and purchases of assets at inflated prices. If the remaining banks survive, it absolutely will not prove that Lehman was brought down in some insidious manner.

Lastly, my real problem with this article is laying any of this blame at the feet of Markit. Markit is a data aggregator. Markit could not possibly cause a selloff or crash by publishing erroneous prices. If I want to know where Citi CDS is trading, I don’t call Markit; I call one of the 10-20 dealers who actually make markets in that CDS. Anyone who is actually in a position to influence the price of any the securities in a significant way would do the same.

On a somewhat unrelated note, the notional size of the CDS market (50-60 trillion) is a scary number but is not especially meaningful. A huge amount of risk is effectively counted multiple times. If I’m a dealer and I buy 10mm of protection for one person and sell 10mm to another, that adds 20mm to the total outstanding notional. But there is really only 10mm worth of risk created (aside for counterparty risk which is another problem). Multiply this over tens of thousands of trades, and the amount of risk is probably overstated by at least an order of magnitude.

It’s kind-of surprising that you don’t know that Rupert Murdoch’s News Corporation owns the Wall Street Journal.

WSJ was the flagship publication of Dow Jones & Co., which News Corp. took over in an all-cash buyout. (DJ also published Barron’s, and the various stock-indices under the Dow Jones brand name.) The deal was announced in April 2007 & closed in mid-December 2007. It had something to do with the extended family descended from the founders of Dow Jones having gotten into an internal squabble over who/whether to keep majority-ownership control of the firm.

Both the family squabbling and the Murdoch bid were very widely reported at the time. One aspect of the reportage was concern about how the WSJ might change or deteriorate once Murdoch took over. He has a decades-long reputation for editorial interference and the basest of tabloid style, after all.

Don’t think many AMERICAN’s would make this comment or feel this way:
“the remarks, in my opinion, smacked of American chauvinism – this company must be bad because it isn’t American”

Not too many people I know from London or the northeast USA in the states use the term ain’t. Thats a true southerner expression. What part of the south are you from? Southerner in London…Nice !!!

You elude to being from London ? Please tell me how long Londoner’s have become southernized and used the word “ain’t” ?