The Collapse of Lehman Brothers | Lawrence and Larry | 1

Business Movers

Wondery

History, Business, Entrepreneurship

4.8 • 1.5K Ratings

🗓️ 9 September 2021

⏱️ 42 minutes

🔗️ Recording | iTunes | RSS

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Summary

Lehman Brothers, the world’s 4th largest investment bank, recorded billions in profits year after year, until September of 2008 when the Wall Street giant was forced to declare Chapter 11 bankruptcy, triggering a global financial meltdown. The collapse of Lehman Brothers is a cautionary tale of too much risk, not enough regulation and plenty of greed. The story starts with two traders who tried to save the company they loved.

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Transcript

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0:00.0	Hey, prime members, you can listen to business movers add free on Amazon music, download the app today.
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0:13.0	Download the Wondry app in your Apple or Google Play mobile app store today.
0:31.0	It's spring 2008 at a private dinner in New York.
0:35.0	Two Wall Street Titans sit across a table, Richard Dick Fault, CEO of Lehman Brothers,
0:41.0	the world's fourth largest investment bank, and Treasury Secretary Hank Paulson.
0:46.0	Previously, the chairman and CEO of one of Lehman's biggest competitors, Goldman Sachs.
0:52.0	The two men are former rivals, but today Dick needs Hank's help.
0:57.0	Lehman Brothers is in trouble.
0:59.0	The company has too much debt and too much exposure to the real estate market,
1:03.0	an industry that's collapsing under the weight of shady lending practices,
1:07.0	bad loans, and widespread defaults.
1:10.0	Many insiders expect Dick to sell off the company in order to save it,
1:14.0	but Dick thinks he has a better plan.
1:16.0	He wants to raise new capital to help Lehman weather the storm,
1:20.0	and he wants to make sure Hank and the US government
1:23.0	will be there to keep Lehman afloat if his plan fails.
1:26.0	Well, Hank, what are your thoughts?
1:29.0	Can the government get behind this plan?
1:31.0	Hank's size and shakes his head.
1:33.0	You need to sell, Dick.
1:35.0	The firm, the assets, everything.
	...

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