The stock market really reacted when news filtered out that the state-run Korea Development Bank was interested in buying a large chunk of Lehman Brothers. In the end, it turned out to be a lot of wishful thinking. The deal isn't going to happen, if we can believe the reports out of Seoul. Government regulators have essentially said that they want to add investment banking expertise to their Korea Development Bank, which is going to be privatized, but they also are wary of exposing taxpayers to the financial crisis. This is hardly an optimistic sign. To most people, it indicates that there will be no deal with a big foreign liquidity source, despite what we assume are the best efforts of Richard Fuld and others. Meanwhile, the clock ticks.

For more:
- here's an article from Business Week Online

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