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Lehman Bros tips over the brink
14th September 2008
Bear Stearns, Lehman Bros, Merrill Lynch - investment banks with incredible exposure to the sub-prime monrtgage crisis, over-extended banks with toxic bad debts exploding all over the place. At 5-44am this morning UK time, Lehman bros filed for chapter 121 bankruptcy - the 4th largest investment bank in the world has gone bust. It is going to be one hell of a garage sale as the remaining assets are sold off frantically to anyone who wants a piece of the action.
“Lehman Brothers Holdings Inc. (“LBHI”) announced today that it intends to file a petition under Chapter 11 of the U.S. Bankruptcy Code with the United States Bankruptcy Court for the Southern District of New York.”
Barclays took a look at Lehman Bros and has pulled out. There is no doubt – the collapse of Lehman Bros is one of the biggest collapses in global financial history. They said thet Lehman Bros was too big to fail - they were wrong. In related news Merrill Lynch, another iconic investment bank is to be bought by Bank of America. So the 5 huge investment banks have now become 2. Next in line is AIG.
Robert Peston is superb on these issues. And there is more here
Share price chart
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Geoff Riley
Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.