Mr. Fuld correctly assumed responsibility for the failure of Lehman Brothers, because he could have should have known the environment they were working in and how their transactions put investor's money at risk.
His remarks do however indicate that regulators were at the best asleep at the switch for not proposing some of the lifelines that will now be offered to others.
Lifelines may not save a sinking ship, but they could have provided more time to find more substantive measures to correct the financial flood before the ship of Lehman Brothers went under.
Timing is certainly an issue as well, because politically we are at the end of a Presidential term and coming up to a congressional election, therefore congress certainly, and the administration likely could have been less focused on the brewing storm than they needed to be.
The real losers are primarily the shareholders (they should see themselves as owners rather than investors) because owners pay attention to what is happing in their company)Every employee that did not have a golden parachute lost substantially and may never be able to make it up. All of the myriad of companies that did business with Lehman Brothers are also big losers.
This Economics 101, but it goes bad when owners, management, and government have all been doing what they could get away with rather than doing what they are supposed to.
Don
of SC
@
Oct 07, 2008 02:27:08 AM
Short memory
Interesting that the only reasons he lists all happened within the last 6 months or so. Obviously none of the many decisions he has made prior to this has anything to do with the bank being in such a high risk situation that these last nails in the coffin finally sank the ship....
I think that all executive renumeration should come with a 10 year claw-back clause - that way, the bonus they get for 'developing a unique new arm of the business' gets clawed back when the new arm turns into an expensive dead limb that finally needs to be expensively surgically removed. How many times have we seen that happen, and yet the exec who started it has been rewarded and gone, and the exec who hacks it off, gets rewarded also for stopping the rot....
Don of SC @ Oct 07, 2008 02:27:08 AM
jim @ Oct 06, 2008 21:58:14 PM
of @ Oct 06, 2008 21:44:39 PM
tyler of WI @ Oct 06, 2008 20:50:53 PM
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