The $8x3 settlement is not even close to accurate IMO. People are using $8 because that was what JPM offered. That offer was given with no intention of following through. JPM knew they were getting it cheaper. The common reference to "damages x 3".
needs to be looked at differently. $8 was not the damages it was the offer. The true damages were the loss of a 300 billion dollar company for 1.9 billion.
I am not saying that the 3 x damages will be 900 billion but I doubt that they will use the rejected offer as a starting point for "damages".
So what damages did WAMU get? That number could be well over 50 billion.
Before all this WAMU was at around $12-15 PPS that was what was lost. Add intrest to that, and loss of revenue, and slander, and use of wamu's name and that would be a good place to start a "damage" number.
This is why JPM and FDIC would want to settle. If all they would be hit with was an $8 per share settlement they would let it go to court without a problem.After all thats what they were willing to pay in the first place and 3x that would be pretty close to a fair price when they bought it. BUT with the judges ability to tripple a number in excess of 50-100 billion they dont want to give her a chance.
To put it in perspective...
If some dumb ass can spill hot coffee in their lap and sue MacDonalds for 5 million in damages cause the coffee was hot. I think WAMU could sue for a hell of a lot more then $8 per share
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