Lehman's has announced its turnaround plan - keep selling off the residential mortgages, spin off the commercial real estate, sell a chunk of the investment management division, cut dividends and hope to pull through. (Sounds familiar.)

It was never likely that the US authorities would be prepared for a second bailout in the same week, after all.

Felix Salmon said yesterday that Lehman could be the first major default of the crisis. Or maybe WaMu.

The FT points out that the equity markets are not impressed. Neither are the CDS markets; Lehman ten-years are now at 610 bp and WaMu at 2200bp!