Lehman Brothers, the bank that bust the boom
6th September 2009
The collapse of Lehman Brothers, a year ago this week, was the biggest bankruptcy in corporate history. It was 10 times the size of Enron and, more crucially, the tipping point into the global crash, provoking panic in an already battered financial system, freezing short-term lending, and marking the start of the liquidity crisis.
Yet searching questions remain unanswered. Authorities had intervened on both sides of the Atlantic to rescue a litany of stricken institutions, from Northern Rock to Bear Stearns, and mortgage companies Fannie Mae and Freddie Mac, so why let Lehman go down? And was a rescue by Barclays effectively blocked by the UK authorities?
Indeed. Some people get bailed out, some people get their heads stepped on as they’re circling the drain. Wonder why?