The stock charts of Bear Stearns, Lehman, and Goldman Sachs (GS) did not look well to me and with the Saturn/Neptune cycle about to end and Saturn soon to go into Virgo, I knew that the credit bubble was about to pop and lending would tighten substantially. The addition of Jupiter in Capricorn in December 2007followed by Pluto in Capricorn a month later would really start to unravel all the bad debt and financial wizardry the investment and commercial banks had engaged in. With the business planets Jupiter and Saturn in earth signs, everyone is very wary as no one knows for sure what’s on the books at these banks, let alone what their actual values are. It seems like something somewhere is getting marked down on a daily basis.

With Bear’s rapid unraveling, it seemed that Lehman’s strategy of making CFO Callan their public face was a good one. On Lehman’s FQ1 March 18 earnings call, investors appeared soothed by Callan’s level of detail. Yet questions remained. In an April 11 post on Lehman, I wrote about $300 million in writedowns taken in liquidating three funds. Despite absorbing $1.8 billion (there’s that “b” word again) onto its balance sheet, Lehman chose to quietly reveal it in an April 10 SEC filing.

Two people left their management positions yesterday, yet the media’s focus has been on Erin Callan. Callan only became CFO in December, while Joseph Gregory had been president since 2004, a multi-decade Lehman insider and friend of CEO Fuld. Lehman came very close to be swallowed by the Bear in March, and I think Callan’s efforts went a big way to help them stay afloat. Lehman lengthened the terms of its collateralized borrowings. A CFO does not have complete authority in calling the shots. Callan’s actions would have to have been approved by Gregory and Fuld.

The Journal cites Callan agreeing to talk to hedge fund manager David Einhorn who is shorting Lehman, as a distraction for the firm. Yet the paper also acknowledges that Callan first received approval from her bosses to do so. While Einhorn raises many valid concerns about Lehman, he has become part of a new breed of short seller.