Lehman Brothers sitting on a stockpile of uranium 'yellowcake'

[AtW]

Tosh.

"Liquidators have been trying to offload the stuff for months."

It's not liquid asset: highly exotic, highly controlled. You can't even sell it to the highest bidder from the Middle East even if you wanted to.

[Moscow Mule]

Tosh.

[AtW]

Buying and selling for profit is unethical now?

It's not question of ethics - at the very least they should have considered that uranium yellow cakes ain't traded on every corner because it is a controlled substance and buyers are fairly limited - you don't get nuclear stations popping up every day, so demand is fairly stable.

As an investment bank (which they wen't) they should have invested into companies that would create products of tomorrow - electric cars or ultra efficient batteries for them etc.

[expat]

Buying and selling for profit is unethical now?

Anything that AtW muses that he might not like, should be strictly forbidden. Until he changes his mind. Bit like Stalin. You can take the boy from Russia......

[Moscow Mule]

The point is that they should not be speculating on uranium yellow cakes.

Buying and selling for profit is unethical now?

[AtW]

And it's only a $10M loss based on those figures. I'm guessing they made much worse deals.

The point is that they should not be speculating on uranium yellow cakes.

[Moscow Mule]

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FFS, no wonder they went bust!

fizzle, click click click.

And it's only a $10M loss based on those figures. I'm guessing they made much worse deals.

[AtW]

Lehman's nuclear stockpile is a hangover from a trading contract undertaken before the Wall Street bank collapsed last year

The rump of the bankrupt bank Lehman Brothers is sitting on a stockpile of 450,000 lb of uranium "yellowcake" which could be used to power a nuclear reactor or, theoretically, to make a bomb.

Lehman's potentially explosive asset is a hangover from a commodities trading contract undertaken before the Wall Street bank went bust in September. The substance, yellowcake, is a solid form of mined uranium which is yet to be enriched.

Liquidators have been trying to offload the stuff for months. But the price of uranium has been dropping steadily, leaving Lehman's yellowcake languishing in a variety of secure storage facilities, some of which are in Canada.

Bryan Marshal, Lehman's chief executive, who was appointed to salvage value for creditors, told Bloomberg News that the stockpile, which is worth about $18m, would be sold responsibly.

"We plan on gradually selling this material over the next two years," he said. "We are not dumping this on the market and have no fire-sale mentality."

The price of uranium has slumped from $65 per pound to $40.50 over the last six months as pressure on recession-hit commodity investors to liquidate their assets has eased.

Yellowcake can be purified and enriched to fuel nuclear reactors or, notionally, weapons. A lively financial market in uranium trading has developed in recent years. While commodities such as oil and precious metals are dealt in futures contracts which rarely see delivery, the relative immaturity of uranium trading means that trading firms sometimes end up taking ownership of the stuff.

"Uranium is a liberalising marketplace. It's not as mature as most other exchange-traded commodities," said Scott Lawrence, head of nuclear fuel trading at MF Global in London. "It's certainly not unusual for a wide range of parties to have legal title to the material."

Lehman's ownership is governed by tight regulations. Its yellowcake must be stored at licensed facilities and the substance cannot be transported around freely. One trader said: "They're not holding it in Canary Wharf. There are very strict rules about what you can do with it."

Some 43m lb of yellowcake was sold on the spot market last year. Market participants say Lehman tried to sell its stockpile in one block but was unsuccessful and may try to sell it on a piece-by-piece basis instead.

Lehman's brokerage operation was bought in September by Barclays Capital, which took on about 10,000 of the bankrupt firm's staff. The remaining chunk of Lehman has outstanding debts estimated at $200bn

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FFS, no wonder they went bust!