Exclusive outtakes from industry leaders
‘People were trying to take Lehman down’
Markets are still anxious following the financial implosion of Bear Stearns but the situation has vastly improved since the Fed stepped in, Pacific Alternative Asset Management CEO Jane Buchan told the Reuters Hedge Fund and Private Equity Summit on Tuesday.
“Two weeks ago, it was clear people were trying to take Lehman down,” she said, which was one of the main reasons the Fed got heavily involved in arranging for JPMorgan to buy Bear Stearns, and lending directly to Lehman Brothers and other Wall Street brokerages.
“Everyone was talking about Bear Stearns, but I think the bigger issue is, who was next,” said Buchan, whose company runs a $10 billion hedge fund of funds. But the Fed’s moves at the time “really calmed the market.”
“I think the market’s come to the conclusion that the Fed’s going to backstop this and no one else is going down,” she concluded.