Lehman shuffle the team, no new faces, no new ideas, ... the Bonfire of the Vanities ... Wail Street just needs a few more sparks

UPDATE 01.00 BST Lehman stock closed @ US$ 22.70 $ down US$1.05 =4.42% and was as low as US$21.17 in late afternoon. Doesn't look like re-arranging the deck chairs has worked.

Wow!!!! Lehman Brothers, have put Joseph Gregory, president and CEO out to grass but not out the door, the beautiful telegenic Erin Callan is now ex CFO and will...er..will be rejoining the Investment Banking Division in ...er...a .. er .. senior capacity.

Perhaps with more time to enjoy her luxurious Us$ 6.5 Mn. 31st-floor condo she showed us round @ 15 Central Park West she bought when she was upgraded in December to CFO. (pic)

In comes Herbert (Bart) H. McDade III , 48 who will succeed Joe who get's the Dear John .....“Joe has been my partner for over 30 years and has been a driving force behind who we are today and what we have achieved as a Firm," said Richard S. Fuld, Jr., Chairman , and barely paused to say, “Bart, who has been my partner for 25 years and has proven himself to be the Firm’s best operator..."

Ian Lowitt, 44 global head of equities, will now sit in the chair which petite Erin's derriere has barely warmed over since last December. He will join the Firm’s Executive Committee - and get the key to the Executive bathroom , no doubt.

In another announcement they said, "The Firm does not expect to disclose in its quarterly results announcement scheduled for Monday, June 16 any material changes from the preliminary results announced Monday, June 9"

Which means if there are any skeletons in the cupboard (as some folks shorting the stock say there are) they are staying there. Well for the time being.They have also closed today, the US$4.Bn. stock offer and US$2 BN Loan at 8.75% Convertible Stock offer.

At 4.45 BST the stock was down slightly @ US$23.38 off 37 cents - down 1.56% as the market absorbs the news.

Lehman's major problem is not management , although it is a consequence of previous management failures. They are (not alone on Wail Street) chock full of underperforming and questionable assets whose value is declining more the more they get examined.See IHT today "Some derivatives traders taking a closer look at Lehman Brothers" which has a nice quote from a trader about Fed support .."Fed backing does not make you financially invincible."

The problems the market perceives today have their origins in decisions over the last 2/3 years and cannot be wished away, unwound or made to disappear by some accounting legerdemain.

Erin will longer act the role of arm candy, whose undoubted sparkle will smooth over the worries and sniping... Mr Lowitt will not get such a smooth ride. Lehman have tried the "teeth'n'tits" stratagem, now they have shaken (slightly) the team selection .....

Erin is of course good pals with Chicagoan Kenneth C Griffin and has helped over several years (with Lehman's dosh) his US$20 Bn, Chicago based Citadel Investment Group. He is of course a big noise in Chicago, a supporter of Barak Obama and also the lovely Michelle. Citadel daily trading activity reportedly is reputed to account for "more than 10% of daily U.S. listed equity options contract volume" and issued investment grade bonds in 2006.

Bill King, the co-head of JPMorgan Chase's global securitized products, recently left to join Citadel.