Sales of Canada Savings Bonds put on hold market meltdown

Amid worldwide credit market turmoil, the federal government has postponed sales of one of the country’s favourite investments, Canada Savings Bonds.

A terse message posted on a government website says the 2008 bond campaign, scheduled to start Monday, has been put on hold. And a Department of Finance spokesperson confirmed the postponement.

“There are no bonds on sale at this time,” it says.

“The new sales date, interest rates and bond series will be announced shortly. Rates for outstanding issues of bonds will be announced at the same time.”

‘This is unprecedented as far as I know.’—Evelyn Jacks, Winnipeg-based tax expert

Federal officials would give no reason Tuesday for the delay, which presumably relates to the difficulty of setting interest rates under current conditions.

The bonds, a Canadian tradition since 1946, are backed by the government and promoted as a foolproof way for small investors to save. They are put on sale each fall.

David Gamble, public affairs director of the Department of Finance, which is responsible for CSBs, confirmed that the 2008 campaign has been delayed but would not say why.

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Lehman Files for Biggest Bankruptcy in American History, rumors of warnings with AIG and Citibank and the coming market meltdown

Sept. 15 (Bloomberg) — Lehman Brothers Holdings Inc., the fourth-largest U.S. investment bank, succumbed to the subprime mortgage crisis it helped create in the biggest bankruptcy filing in history.

The 158-year-old firm, which survived railroad bankruptcies of the 1800s, the Great Depression in the 1930s and the collapse of Long-Term Capital Management a decade ago, filed a Chapter 11 petition with U.S. Bankruptcy Court in Manhattan today. The collapse of Lehman, which listed more than $613 billion of debt, dwarfs WorldCom Inc.’s insolvency in 2002 and Drexel Burnham Lambert’s failure in 1990.

Lehman was forced into bankruptcy after Barclays Plc and Bank of America Corp. abandoned takeover talks yesterday and the company lost 94 percent of its market value this year. Chief Executive Officer Richard Fuld, who turned the New York-based firm into the biggest underwriter of mortgage-backed securities at the top of the U.S. real estate market, joins his counterparts at Bear Stearns Cos., Merrill Lynch & Co. and more than 10 banks that couldn’t survive this year’s credit crunch.

“There is likely to be a domino effect as other firms and individuals who relied on Lehman for financing feel the effects of its meltdown,” said Charles “Chuck” Tatelbaum, a bankruptcy lawyer with Lauderdale, Florida-based Adorno & Yoss and former editor of the American Bankruptcy Institute Journal. “The whole thing is frankly frightening for the U.S. economy.”
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