Joseph Tibman was a senior banker at Lehman Brothers for 20 years and is now the author of “The Murder of Lehman Brothers, An Insider’s Look on the Global Meltdown”. Tibman writes under a pseudonym to preserve his ability to work in finance. The views expressed are his own.
Credit markets today have healed after the entire U.S. junk bond market traded at distressed debt levels suggesting a substantial risk of default. Those bond prices have since recovered and now offer investors returns of 40 percent to lead major asset classes.
The anniversary of Lehman Brothers’ collapse on September 15 will doubtlessly bring with it vast numbers of stories about what it all meant. It was, after all, the largest bankruptcy in U.S. history, a marker for the near collapse of the financial system and the trigger for government to pump trillions of dollars into economies to stave off another Great Depression.
from Davos Notebook:
Was letting Lehman go down the biggest mistake of the crisis? Many, including George Soros in the Financial Times, have argued that letting Lehman go down sowed panic to markets, consumers and businesses.