The story of the day, which hit at 6:00 AM CT, was that Lehman was being "eyeballed" by a Korean group lead by Korea Development Bank (KDB).

This resulted in an instant ramp in the futures which persisted into the day, and was the catalyst for the near-200 point rally in the market.

CNBC and Bloomberg were repeating the story literally all day long, with Bloomberg running it as recently as 5:30 Eastern.

There's only one problem - KDB denied the claim early this morning:

"South Korean banks led by Korea Development Bank (KDB) have shelved plans to buy a stake and management rights in Lehman Brothers due to concerns about its financial health, a report said Friday.
....
Problems with the accounts were more serious than initially believed, an unidentified government official was quoted as saying. "We concluded that it was too risky for KDB to take the deal."

That was 9:00 Central Today.

As of 5:00 PM Central the claim that there is interest in a deal continues. 

Even though it has been officially denied by the government, which runs KDB.

Never mind that there are all sorts of other problems, like the fact that an actual purchase of a US Investment bank by a foreign-government-controlled entity has about as much chance of passing regulatory approval as does the chance of us selling Iran a suitcase nuke for $25, especially with a Democrat majority Congress.

Now I can see the news media reporting the "rumor" because, well, they do that sort of thing.  I can also see it producing a ramp job in the futures, which it did.

But how can you defend the media continuing to run this "story" literally every 15 minutes, either directly or in some kind of crawler on the bottom of the screen, when the people who would be doing the buying have said they are not interested because they don't trust the financials of the firm involved!

(I will give props to CNBC on this in one regard - Jeff Macke on Fast Money midday said he didn't believe it for a second.  Well duh, that might be because Korea's government denied it!)

Folks, if you bought stock today and this "rally" turns out to be utter and complete crap, especially if you bought Lehman stock, and no deal materializes, you may want to talk to an attorney.

See, the news media has broad-based First Amendment rights to voice opinions. 

But willful and intentional ignorance of the facts may indeed cross a civil liability line, and if I were damaged from such an event, you can bet your last nickel I'd be trying to find out.

Now maybe Monday morning we will wake up to hear that indeed a deal has been announced or that there really is something in play.

But assuming there is no deal, at some point this sort of outrageous conduct in the face of an explicit denial (which was NOT mentioned on the air to the best of my knowledge) has to be met with some sort of legal sanction by someone.

The outright lying and complicity of the media when it comes to the market is completely out of control.  We've been treated to these rumors of "buyouts" of all sorts for the last year, and almost without exception, they have proved to be lies and produced nothing but losses - sometimes catastrophic losses - for the investors who believed them.

If you agree, send this ticker to enforcement@sec.gov or write your own letter.  It is high time that sort of garbage be stopped and the people producing, disseminating and "pumping" these rumors be prosecuted.