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LAST WEEK, Lehman Brothers Holdings Inc. shares plunged 77% as the firm posted the biggest loss in its 158-year history and investors scoffed at the recovery plan laid out by Chief Executive Richard Fuld.
Lehman's demise as an independent firm is a virtual certainty And with an acquisition by another firm likely to result in cutbacks rivaling those seen at Bear Stearns Cos. after J.P. Morgan Chase absorbed it, the fallout will be staggering.
Topping the list of losers are Lehman's 25,000 employees, roughly a quarter of whom work in New York. Last year, the firm's global payroll totaled nearly $10 billion, which works out to an average of $332,000.
Employees, who own 30% of their firm's stock, have already seen their wealth shrivel drastically, with the 95% drop in Lehman's shares this year wiping out $15 billion of their net worth. Many of them now face losing their livelihood. Even in the best-case scenario - another bank swooping in to rescue Lehman - the job losses will be heavy.
"You could see 12,000 people on the street,"...