It really is like waiting for a new Pope to be chosen, isn't it? Except the expectant crowd at St. Peter's is the Asian markets. Little details from the WSJ:

... Things were moving so quickly Saturday that there was little time to do extensive employee interviewing that typically happens in company auctions. "It's all triage," said this person.

One person leaving the building said at least 100 people were gathered inside trying to settle the fate of Lehman, which has been staggered by its exposure to soured real-estate-related assets.

Outside the Fed's downtown headquarters, a fleet of black towncars [oddly, or not, like mobsters] waited for bankers who were inside. At one point, the towncars blocked the narrow streets around the building, causing a traffic jam that had to be broken up by the Fed's uniformed guards. Meanwhile, bankers and Fed staffers milled around outside, smoking cigarettes and talking on their cell phones about subjects like counterparty risk.

At about 3 p.m. on Saturday, Barclays President Robert E. Diamond Jr. was seen entering the New York Fed's employee entrance on Maiden Lane, carrying a briefcase. ...

... After 5 p.m., bank executives began leaving the meeting, some getting into cars inside a garage where they couldn't be photographed. Those seen leaving included Merrill Lynch & Co. Chairman and Executive John Thain and Citigroup Inc. CEO Vikram Pandit. Bank of New York Mellon Corp. Chairman and CEO Robert Kelly declined to comment.

After 6 p.m., the formal meeting ended for the day with no resolution, though some participants stayed behind to continue talking. ...

While some executives had left the Fed meeting, those of other firms, including three carfuls of Barclays executives, remained at the Fed office past 6 p.m.

At least 20 New York Fed staffers left from another exit. They refused to say if they were done for the night.

At about 8 p.m., New York Fed President Timothy Geithner was still at the bank's headquarters. Officials from the New York Fed and various banks were expected to continue working through the night. ...

Well done, all.

And I'm sure all of these people, every single one of them, has a bolthole lined up, and money salted away.

But it's not the economy, oh no no no no. Stupid.

UPDATE Dealbreaker website says BankOfAmerica to take on Lehman's portion of the big shitpile. The thing that's either nice, or horrible, about this, depending, is that since this is a private bailout, presumably the market now has some idea of the actual value of the big shitpile, and can price their portfolios accordingly. That could be good, or bad. Nobody knows anything. And everybody's playing chicken, which I suppose is the definition of "rational" these days:

Bank of America played a brinkmanship role in negotiations, threatening to let Asian markets open on Monday without a deal, the website said, citing a person familiar with the matter.

Apparently Lehman was too greedy and not fearful enough:

Lehman's brass is also pushing to keep the firm independent and take it private through a management buyout. But that strategy is fraught with challenges given the stunning wealth erosion Lehman executives have just experienced.

The tragedy of Lehman's current plight is that CEO Dick Fuld might have been able to strike a deal to sell a majority stake in the investment bank for $26 a share back in August.

"Tragedy?" Tragedy is where beautiful people die at the end; it's not about "wealth erosion." The only people who are going to die at the end of this are little people whose money got stolen by rich people. But it's not the economy, no no no no. Stupid.

UPDATE Swear to God, I ran the white smoke riff before checking Krugman. Parallelism of great minds...

UPDATE Nouriel Roubini on a possible outcome: A run on the shadow banking system. That would be bad.