The Lehman Scandal: $60 Billion, 158 Years, Gone in 72 Hours

追加: 2026-06-02

[00:00:00]In 2010, a Lehman Brothers corporate sign sold at auction for $800,000.

[00:00:06]A metal sign. That is all that was left of a firm that had survived the Civil War, two world wars, the Great Depression, and the near collapse of the American economy more times than most people can count. When Lehman Brothers filed for bankruptcy on September 15th, 2008, it held $639 billion in assets.

[00:00:27]The filing was the largest in American history. 26,000 people lost their jobs in a single morning. Within 6 months, global stock markets had lost more than half their value. Entire economies buckled. Retirement accounts vanished.

[00:00:44]The aftershock reached every corner of the world. It is remarkable that a firm which endured so much for so long could disintegrate in less than a week.

[00:00:53]Lehman Brothers was not destroyed by a war, a crash, or a natural disaster. It was destroyed by its own people, but not the people most documentaries focus on.

[00:01:03]The real fracture happened decades before the bankruptcy filing. It happened when the last member of the Lehman family died, and a firm that had been built by brothers, fathers, and sons passed into the hands of strangers.

[00:01:16]To understand why the fourth largest investment bank in America collapsed over a single weekend, you have to go back more than a hundred years. Back to a time when the Lehman name meant something very different on Wall Street.

[00:01:28]Back to the man who turned a cotton broker into a financial empire and the family that held it together for three generations until they didn't.

[00:01:37]Chapter 1, the outsiders.

[00:01:42]At the turn of the 20th century, Wall Street ran on an unwritten rule. The established banks handled the serious business. Steel, railroads, shipping.

[00:01:53]JP Morgan and his circle funded the industries that were building America, and they chose their partners carefully.

[00:02:00]If your name was not on the right list, you did not get invited. Lehman Brothers was not on the list. Neither was Goldman Sachs. Both were small firms run by Jewish families in a financial world that kept them at arms length. The old guard considered them second tier, fine for commodities, not serious enough for securities. Philip Leman, who took over the firm from his father, Emanuel, in 1901, saw this clearly. But he also saw something the old banks refused to see.

[00:02:30]A new kind of American business was growing fast, and nobody was funding it.

[00:02:34]Department stores, five and dime shops, mail order catalogs. Companies like Sears, Robuck were selling goods to millions of ordinary Americans, but the established banks would not touch them.

[00:02:45]Backing a retail store was considered beneath them. It lacked the prestige of financing a railroad or a steel mill.

[00:02:52]Philip disagreed.

[00:02:54]He believed these companies were the future, and he found a partner who thought the same way.

[00:03:00]Henry Goldman, the dominant figure at Goldman Sachs, was a personal friend.

[00:03:05]The two men shared more than business strategy. They shared the experience of being shut out by the same establishment.

[00:03:13]In 1906, they formed an alliance.

[00:03:17]Together, they took Sears, Robbuk, and the General Cigar Company public. It worked. Over the next 20 years, Lehman Brothers and Goldman Sachs underwrote securities for nearly a hundred new companies. FW Woolworth, Macy's, Gimble Brothers, Studebaker, May Department Stores, Endicott Johnson. These were not small deals. Woolworth alone went public with $15 million in preferred stock and $50 million in common stock. Goldman Sachs, Lehman Brothers, and the London firm Kleinwart Suns handled the underwriting together. Philip had found the crack in the wall, and he walked straight through it. While JP Morgan funded steel, the Lemans funded the stores where ordinary Americans spent their money. It was a different kind of power, but it was power. The firm remained a family operation in the strictest sense. Until 1924, only male-blood relatives of the Layman family could become partners. Philip's cousins, Arthur, Sigman, and Herbert, all held seats. His nephew Allan joined in 1908.

[00:04:24]The firm grew, but the bloodline held the keys. Philip himself lived in a five-story limestone mansion at 7 West 54th Street in Manhattan, designed by architect John H. Duncan, the same man who designed Grant's tomb. It was the home of a man who had arrived. Not flashy, not loud, but unmistakably established. By the early 1920s, Philip began to step back. His son, Robert, who had joined the firm in 1919 after serving as a captain in the First World War, was rising quickly. He became a partner in 1921. By 1925, Philip retired and Robert took his place.

[00:05:06]The cotton broker from Alabama was now an investment bank. The outsiders had built themselves a seat at the table, and the family that built it still controlled every door in the building.

[00:05:17]That was about to change.

[00:05:19]Chapter 2. A family already leaving.

[00:05:25]Robert Leman collected Buchelli and Renoir the way other bankers collected client dinners. By his 30s, he was acquiring masterworks at a pace that put him among the most serious private collectors in the country.

[00:05:37]He traveled through Europe between the wars, building on the collection his father, Philip, had started in 1911.

[00:05:44]Over the course of six decades, Robert assembled more than 2,600 works, old masters, impressionists, drawings, manuscripts, sculpture, glass. It was not a casual hobby. It was his life's work. He also ran a bank and he was good at it. Robert expanded Lehman Brothers into industries the older Wall Street firms refused to consider. In the 1920s, he financed the merger of vaudeville theater chains into RKO, creating a circuit of more than 700 theaters. He backed Paramount Pictures in 20th Century Fox when the established banks thought motion pictures were a fad. He put money into airlines, Capital, Continental, National.

[00:06:30]He sponsored the first public underwriting of a television equipment company, Alan B. Dumont Laboratories, in the late 1930s.

[00:06:39]After the Second World War, Robert pushed even further. The post-war economic boom was creating entirely new industries, and Lehman moved quickly. In 1953, the firm provided $1.5 million in seed funding for Litton Industries, an early technology conglomerate. That single investment generated returns many times over as Litton grew into a major defense and electronics contractor.

[00:07:03]Lehman also financed oil and gas exploration ventures, backing companies like Hallebertton and Ker McGee during the drilling boom of the 1950s. By the 1960s, the firm had underwriting relationships across retail, aviation, entertainment, energy, and technology.

[00:07:21]Robert had turned a family partnership into a diversified financial institution with reach across nearly every growing sector of the American economy.

[00:07:30]For more than four decades, Robert steered the firm through every disaster the century delivered. The 1929 crash, the depression, the Second World War. He adapted each time, shifting toward private placements during the New Deal years, then riding the post-war boom into new sectors. But here's what I think matters more than any of that.

[00:07:53]While Robert was growing the firm's reputation, the rest of the Lehman family was quietly walking away.

[00:07:59]Herbert Leman left the firm in 1928 to enter politics. He became Franklin Roosevelt's Lieutenant Governor of New York, then succeeded him as governor and served four terms in Albany. Herbert built his own legacy. He pushed through public housing legislation, tightened child labor laws, established a minimum wage, and expanded unemployment relief during the worst years of the depression. Historians would later call his program the Little New Deal.

[00:08:28]After the war, he ran the United Nations Relief Operation overseeing aid to devastated populations across Europe and Asia. He spent eight years in the Senate where he fought Joseph McCarthy over civil liberties. Herbert chose public service over the family bank and he never came back.

[00:08:46]Irving Lehman never joined the partnership at all. He became a lawyer and eventually chief judge of the New York Court of Appeals. And Robert's own son, Robin, born in 1936, showed no interest in banking. He became a documentary filmmaker and won two consecutive Academy Awards for short films in the 1970s.

[00:09:07]The next generation of Lemans had no intention of carrying the firm forward.

[00:09:12]By all appearances, Robert understood this. By the 1960s, he seemed to spend as much energy at the Metropolitan Museum of Art as he did at 1 William Street. He served as a trustee then as chairman of the board.

[00:09:26]In 1957, the Musea de laerie in Paris exhibited nearly 300 pieces from his collection. He also bred and raced thoroughbred horses, another world entirely removed from balance sheets and underwriting. He was not abandoning the firm. He simply had a life beyond it that mattered more to him. On August 9th, 1969, Robert Leman died at the age of 77. His will directed that the full collection be donated to the Metropolitan Museum. He attached one condition. The art had to be displayed together in galleries that reflected the character of his family's home. The Robert Leman wing opened 6 years later in 1975.

[00:10:07]It is still there. What was not still there was a Leman at the head of Lehman Brothers. For the first time in 119 years, the firm had no family member in charge. No air waiting, no one being groomed.

[00:10:23]The partners looked at each other and realized they would need to find a leader from the outside.

[00:10:29]Robert chose art. Herbert chose politics. Irving chose the law. Robin chose film. None of them destroyed the firm. They simply stopped holding it together. And no one noticed the weight they had been carrying until it hit the floor.

[00:10:45]Chapter 3. The coupe. According to several accounts from inside the firm, Peter Peterson once told Lewis Gluxman to do something about the stains on his ties. He reportedly commented on his weight, his wardrobe, the image he projected to clients.

[00:11:04]Peterson apparently saw it as guidance.

[00:11:06]Glrooksman saw it as humiliation. That tension defined Lehman Brothers for a decade and eventually destroyed it.

[00:11:15]After Robert Leman died in 1969, the firm drifted. Frederick Airman took over but lacked the authority to hold the partners together. By 1973, the situation had deteriorated enough that the firm recruited from the outside.

[00:11:30]Peterson, a former secretary of commerce under Richard Nixon and the son of a Greek immigrant who ran a diner in Nebraska, arrived as vice chairman. Two months later, he was running the firm.

[00:11:42]Peterson stabilized Lehman quickly. He cut costs, tightened operations, and in 1977 merged the firm with the struggling but prestigious Lobe and Company.

[00:11:54]The combined entity, Lehman Brothers, Lobe Incorporated, became the fourth largest investment bank in the country. Five consecutive years of record profits followed. But Peterson had a problem he could not restructure away. Inside the firm, two cultures were at war. The investment bankers, Peterson's people, believed in long relationships with corporate clients.

[00:12:16]They wore the right suits. They attended the right dinners. They saw themselves as the firm's identity. The traders saw things differently. They were generating a growing share of the profits. They worked faster, took bigger risks, and had little patience for what they considered country club banking. Their leader was Glrooksman, a former Navy volunteer who had joined Lehman in 1963 and risen from the bond trading desk to become president and chief operating officer. Peterson and Gluxman were not just different in style. They occupied different worlds. Petersonworked with CEOs and senators. Glicksman read the markets and trusted numbers over handshakes. The investment bankers looked down on the traders. The traders resented being treated as secondass while producing first class returns. In May of 1983, Peterson tried to ease the tension by promoting Gluxman to co-chief executive. It was meant as a gesture of inclusion. Gluxman treated it as a transfer of power. 8 weeks later in July, he demanded that Peterson resign.

[00:13:23]He had already secured enough support among the partners to make the demand stick. Peterson, by most accounts, caught off guard, did not fight. He negotiated a severance package worth several million dollars and walked out.

[00:13:37]Glrooksman had won, but the victory lasted less than a year. Markets turned against him. Profits dropped sharply.

[00:13:44]The partners, rattled by falling returns and internal chaos, decided to sell. In April of 1984, Shears, the brokerage arm of American Express, bought Lehman Brothers, Lobe for $360 million.

[00:14:00]A firm that had operated independently for 134 years was now a subsidiary. The name went through a series of transformations that told its own story.

[00:14:11]She Lehman American Express, then she Leman Hutton after a merger with EF Hutton, then she Lehman Brothers. Each new name buried the original a little deeper. For 10 years, Lehman existed as a division inside a financial conglomerate, stripped of the identity that three generations of one family had spent a century building. Peterson, meanwhile, moved on. He and a young Leman partner named Steven Schwarzman left to start their own firm in 1985.

[00:14:43]They called it Blackstone.

[00:14:46]When Blackstone went public in 2007, Peterson personally received $1.9 billion. The man Glicksman had forced out of a $360 million firm became a billionaire from the firm he built after leaving. Glicksman stayed on briefly as a consultant after the American Express sale. He eventually joined another financial firm and later served as a commissioner at the Port Authority of New York. He died in 2006, 2 years before the firm he had fought so hard to control ceased to exist entirely.

[00:15:20]Chapter 4. The gorilla.

[00:15:24]In 1969, while the executives of Robert Leman's estate were preparing to transfer his art collection to the Metropolitan Museum, a 23-year-old named Richard Ful started his first day as a commercial paper trader at Lehman Brothers. The timing was a coincidence, but it is hard not to read something into it. The last of the founding family was gone. The man who would eventually bring the firm down was walking in. Ful spent the next 25 years inside the building. He outlasted the Peterson era, the Glrooksman coup, the American Express takeover, and the decade of corporate drift that followed. When American Express spun Lehman Brothers off as an independent company in 1994, Ful was named chairman and chief executive officer. He was 48 years old.

[00:16:12]For the first time since the forced sale a decade earlier, Lehman Brothers answered to no one. And for the first time in its history, the firm was a publicly traded company led by a single chief executive with no founding family behind him and no partnership to overrule him. He made it his own.

[00:16:30]Colleagues described Fold as intense, confrontational, and fiercely loyal to those who showed loyalty in return.

[00:16:37]People on Wall Street called him the gorilla. It was not entirely a compliment. He demanded commitment and punished disloyalty. and the people closest to him learned quickly that disagreeing with the boss carried real consequences.

[00:16:50]Chris Pettit had been fooled number two for nearly 20 years. He served as president and chief operating officer.

[00:16:57]In November of 1996, Pettit resigned after a power struggle with three of his own deputies.

[00:17:04]According to reports from inside the firm, Ful did not intervene to save him.

[00:17:09]The lesson was clear to everyone who worked there. Proximity to the top did not guarantee safety. What mattered was alignment with Foo's vision. Those who fell out of step were sidelined or gone.

[00:17:22]Then in 1999, Congress repealed the Glass Stagel Act. The law had separated commercial banking from investment banking since 1933. Its removal meant that firms like Lehman Brothers could now move into entirely new areas.

[00:17:36]Mortgage lending, loan origination, real estate. The wall between making loans and trading securities vanished overnight.

[00:17:46]Two years later, on September 11th, 2001, Lehman's world headquarters sat just blocks from the World Trade Center.

[00:17:54]The firm lost its offices and had to relocate to Midtown Manhattan. Ful held the operation together through the aftermath and earned something close to mythological status among his employees.

[00:18:06]He was the man who kept Lehman standing when towers fell. That narrative became part of the firm's identity. It reinforced the belief that Fold could navigate anything. By the mid 2000s, Lehman Brothers had recovered and expanded. Revenue climbed year after year. Ful's compensation reflected the trajectory. According to congressional records, he received more than $260 million in total compensation between 2004 and 2008 alone. Some estimates for the full period from 2000 to 2008 place the figure closer to 480 million. The firm that Richard Ful had shaped by then was profitable, aggressive, and structurally incapable of questioning its own direction. Every quality he had cultivated, the toughness, the focus, the centralized authority was about to become a fatal weakness.

[00:19:02]because the bet he was about to place required someone, anyone inside the building to say no, and no one did.

[00:19:10]Chapter 5. The bet Lehman Brothers did not stumble into the mortgage business. It walked in, opened its wallet, and started buying companies. In 1997, the firm acquired Aurora Loan Services, a Colorado-based lender specializing in loans to borrowers who did not quite fit the traditional mold.

[00:19:33]3 years later, it purchased BNC Mortgage, a West Coast operation focused squarely on subprime lending. Between 2003 and 2004, Lehman added more mortgage originators to its portfolio.

[00:19:47]What had been a side venture was becoming the core of the business. The logic was straightforward, at least on paper. Lehman would make mortgage loans directly to homeowners. Then it would bundle thousands of those loans together into financial products called mortgagebacked securities.

[00:20:06]Rating agencies would stamp those products with high grades and Lehman would sell them to investors around the world. Every step of that chain generated fees. The more loans they made, the more products they could sell and the more money they earned. The problem was who was getting the loans.

[00:20:26]Subprime did not just mean slightly risky. It meant lending to people with damaged credit histories, thin savings, and sometimes no verified income at all.

[00:20:36]Some borrowers were approved with no documentation beyond a stated salary that no one checked. Others were offered adjustable rate mortgages that started low and then jumped sharply after 2 or 3 years.

[00:20:50]The system was not designed around whether borrowers could repay. It was designed around the assumption that American housing prices would keep rising.

[00:20:59]As long as homes gained value, even a struggling borrower could refinance or sell before the rate adjusted. The entire machine depended on that single belief holding true. And for a while, it did. By 2003, Lehman had originated $18.2 billion in mortgage loans. The firm ranked third in the country. By 2004, the figure topped 40 billion.

[00:21:23]According to reports, by 2006, its lending subsidiaries Aurora and BNC were processing loans at a pace that reached tens of billions per month. Lehman was no longer just underwriting securities tied to mortgages. It was making the mortgages, packaging the securities, and holding large portions of them on its own books. I want to put the risk in plain terms. By 2008, Lehman held roughly 680 billion in total assets. But the firm's own capital, the money it actually had behind those assets, was approximately 22.5 billion.

[00:22:00]That is a ratio of about 30 to1. Imagine buying a house worth $30 million with only 1 million of your own money. If the property drops just 3% in value, your entire stake is gone. That was the position Lehman Brothers had put itself in. Except it was not a single house. It was hundreds of billions in mortgages, commercial real estate, and financial instruments tied to both. Then the ground shifted. Starting in mid 2006, housing prices across the United States began to fall. Borrowers who had stretched to afford their homes started missing payments. Defaults on subprime loans rose sharply. The single assumption that had supported the entire structure was failing. What Lehman did next is what separates a bad bet from a catastrophic one. Instead of pulling back, the firm pushed forward. It continued to originate loans. It continued to hold mortgagebacked securities on its books rather than selling them off. By the end of its 2007 fiscal year, Lehman held approximately 111 billion in commercial and residential real estate related assets.

[00:23:11]That figure had more than doubled from the previous year. In late 2007, Lehman appointed Aaron Kalen Montella as its new chief financial officer. She later said she quickly came to understand that the sheer concentration of mortgage assets on the balance sheet was a serious problem. Regardless of any arguments about quality or hedging, the numbers were not just large, they were exposed. And the market was telling Lehman Brothers that the bet was losing.

[00:23:39]Lehman responded by making it bigger.

[00:23:42]Chapter 6. The lie.

[00:23:47]Here is how you hide $50 billion. You take assets off your books temporarily right before the end of a financial quarter. You sell them to another party in exchange for cash. You use that cash to pay down your debt. When the quarter closes and the numbers are reported, your balance sheet looks healthier than it is. Your leverage appears lower. Your debt appears smaller. Then, just days after the reporting deadline passes, you quietly buy the assets back. The debt returns. The risk returns.

[00:24:20]Nothing has actually changed, but the quarterly report has already gone out and the number the world saw was a lie.

[00:24:28]Lehman Brothers called this technique repo 105. It was not illegal in the narrowest sense. It exploited a loophole in accounting rules that allowed certain repurchase agreements to be classified as sales rather than loans. But the effect was deliberate deception.

[00:24:45]According to the bankruptcy examiner's report, Lehman used repo 105 to remove as much as $50 billion in assets from its balance sheet at the end of reporting periods. The transactions were concentrated in the final days before each quarterly deadline, then reversed almost immediately afterward. The window of artificial health was brief, but it was long enough for the numbers to reach the public. The purpose was clear. Make the firm appear stronger than it was.

[00:25:15]keep the credit rating agencies satisfied, keep investors from panicking. Ernst and Young, the firm's outside auditor, reviewed the practice and approved it. Internal emails from Lehman staff described repo 105 as an accounting gimmick. According to the examiner's findings, senior executives were aware of the technique and its purpose. But year after year, the quarterly reports went out with numbers that did not reflect reality.

[00:25:43]In March of 2008, Bear Sterns collapsed.

[00:25:47]It had been the second largest holder of mortgagebacked securities in the country, right behind Lehman. The Federal Reserve arranged an emergency loan of $30 billion so that JP Morgan Chase could acquire what was left. Bear Sterns had gone from a major Wall Street institution to a fire sale in less than 2 weeks. The message should have been impossible to miss. If Bear Sterns could fall, so could Leman.

[00:26:14]The two firms had similar exposures, similar risks. But when analysts looked at Lehman's published numbers, the situation appeared manageable. The leverage looked contained. The debt looked under control. It was not. The numbers had been dressed up with Repo 105 transactions timed precisely for the reporting window. Lehman's stock dropped nearly 50% after Bear Sterns went down.

[00:26:38]In June of 2008, the firm reported its first quarterly loss since the American Express spin-off 14 years earlier, $2.8 billion.

[00:26:48]Moody's, the credit rating agency, threatened to downgrade Lehman's debt. A downgrade would trigger margin calls and collateral demands that the firm could not absorb.

[00:27:00]Richard Ful scrambled to find a buyer or a capital infusion. He approached the Korea Development Bank, Bank of America, and others. Nothing materialized.

[00:27:12]Meanwhile, inside the firm, the repo 105 transactions continued through the summer. When the full picture finally emerged, it came in the form of a 2,200page report by courtappointed examiner Antonucas.

[00:27:27]The report documented how repo 105 had been used systematically to mislead investors and regulators. It named names. It cited internal communications.

[00:27:36]And it included one detail that I find difficult to forget. Fold's attorneys told the examiner that their client did not use a computer. He accessed email only on his Blackberry and he could not open attachments, including, as it happened, a presentation sent to him in March of 2008 that laid out exactly how Repo 105 worked and what it was doing to the firm's reported numbers.

[00:28:01]Whether that explanation was credible is something everyone can decide for themselves.

[00:28:07]What is certain is that by September of 2008, Lehman Brothers had run out of room.

[00:28:14]The quarterly reports could no longer hold back the truth. The debt was real.

[00:28:19]The losses were mounting. And the people who had been relying on those reports were about to find out just how much had been hidden from them.

[00:28:28]Chapter 7. The last weekend of Friday, September 12th, 2008.

[00:28:36]Treasury Secretary Hank Pollson, Federal Reserve Chairman Ben Bernani, and New York Fed President Timothy Gitener called an emergency meeting at the Federal Reserve Bank of New York on Liberty Street. The heads of every major Wall Street firm were summoned. The subject was Lehman Brothers. The firm could not open for business on Monday unless something changed over the weekend. Either someone bought it or it would be forced into bankruptcy. Two potential buyers existed. Bank of America and Barclays. the British Bank.

[00:29:07]Both had been examining Lehman's books in the days leading up to the meeting.

[00:29:11]Both were interested in the firm's core operations, its investment bank, its trading desks, its client relationships.

[00:29:19]Neither wanted the 60 to80 billion in toxic commercial real estate assets sitting on Leman's balance sheet. For a deal to work, those assets had to go somewhere else. Saturday, Pollson and Gitener worked with the assembled Wall Street executives on a plan. The major banks would pull their resources to create what was called a bad bank, a special purpose vehicle designed to absorb Lehman's troubled real estate holdings. Once those were removed, Barkclays could acquire the healthy parts of the firm. Pollson pushed the banks to contribute$25 to30 billion to capitalize the vehicle. They refused. The numbers were too large. The risk was too concentrated. At the same time, something else was happening. Meil Lynch, chief executive John Thain, had reached out to Bank of America chief executive Ken Lewis. By Saturday evening, the two were negotiating a deal for Bank of America to acquire Meil Lynch instead of Lehman. When Pollson learned about the discussions, he did not object. He believed Barkclays was still in play.

[00:30:24]Sunday morning, lawyers for Lehman and Barclays were drafting documents for a takeover. By early afternoon, it appeared that a deal was at hand. Then everything fell apart. Barklay's chief executive John Varley and President Robert Diamond informed Pollson and Gitener that the Financial Services Authority, the British Regulator, had declined to approve the acquisition.

[00:30:48]Under British law, a deal of this size required a Barkley shareholder vote.

[00:30:53]That vote would take weeks, possibly months. Lehman could not survive weeks.

[00:30:58]Barkclays needed either the American or British government to guarantee Lehman's trading obligations during the gap. The FSA refused to grant a waiver. According to multiple accounts, the British side communicated that they had no interest in absorbing American financial problems. Pollson tried to reach British officials. The answer did not change.

[00:31:18]Barclays was out. Bank of America had already committed to Meil Lynch. No other buyer existed.

[00:31:26]There was one remaining option, a government bailout. 6 months earlier, the Federal Reserve had provided $30 billion in emergency support to prevent Bear Sterns from collapsing. The week before, the government had placed mortgage giants Fanny May and Freddy Mack into conservatorship. But Pollson had drawn a line. He had told the assembled bankers on Friday that there would be no public money for Lehman.

[00:31:52]Whether that position was driven by principle, politics, or a miscalculation of the consequences, it held.

[00:31:59]Sunday night, Lehman's board held its final meeting. There was nothing left to discuss. No buyer, no government lifeline, no private consortium willing to step in. The firm's lawyers began preparing the paperwork. At 1:45 on the morning of Monday, September 15th, 2008, Lehman Brothers Holdings Incorporated filed for Chapter 11 bankruptcy protection. The petition listed $619 billion in debt. It was the largest bankruptcy filing in the history of the United States. A firm that had been founded by three brothers selling dry goods in Alabama 158 years earlier ceased to exist before the sun came up.

[00:32:41]The morning after Lehman Brothers filed for bankruptcy, the Federal Reserve lent $85 billion to the global insurance company American International Group.

[00:32:52]AIG's exposure to Lehman through a web of credit default swaps had brought it to the edge of collapse overnight. The rescue came less than 24 hours after the government had refused to extend similar help to Lehman. Markets went into freefall. The Dow Jones Industrial Average dropped 500 points on September 15th, its sharpest single-day decline since the attacks of September 11th, 2001.

[00:33:19]Over the following weeks, credit markets froze. Banks stopped lending to each other. Businesses could not access financing.

[00:33:28]By March of 2009, the Dow had lost more than half its value. Unemployment in the United States reached 10%. General Motors and Chrysler filed for bankruptcy. Retirement accounts tied to the stock market were gutted. The damage spread from Wall Street to every town in America and from there to economies around the world. In October of 2008, Richard Ful appeared before the House Committee on Oversight and Government Reform.

[00:33:56]He told Congress that Lehman Brothers was the only major firm the government had forced into bankruptcy.

[00:34:02]He said he had acted responsibly. He blamed short sellers, credit rating agencies, and a loss of market confidence. He did not accept fault for the firm's collapse.

[00:34:14]According to the congressional record, Lehman had paid more than $16 billion in bonuses during the years leading up to the bankruptcy. Full zone compensation during that period exceeded $260 million.

[00:34:28]Yet, no criminal charges were ever brought against any senior Lehman executive. The courtappointed examiner found evidence that the firm had misled investors through repo 105.

[00:34:41]The New York Attorney General sued Ernst and Young, Lehman's auditor, for assisting in what the lawsuit called financial fraud, but no one went to prison. In 2010, Congress passed the DoddFrank Wall Street Reform Act, the most significant overhaul of financial regulation since the GlassSteagall Act of 1933.

[00:35:02]It was designed to prevent another Leman. Whether it succeeded is a question economists and regulators still argue about today. Fold eventually resurfaced. He sold his luxury estate in Idaho for $20 million.

[00:35:17]He founded a small advisory firm called Matrix Private Capital Group offering investment services to wealthy clients.

[00:35:25]In 2015, in his only public appearance since the crisis, he told an audience that his advice was simple.

[00:35:33]Enjoy the ride. No regrets.

[00:35:37]Peter Peterson, the man Lewis Glicksman had forced out of Lehman Brothers in 1983, died in March of 2018. He was 91 years old and worth an estimated $2 billion, nearly all of it earned at the Blackstone Group, the firm he built after leaving Lehman. Steven Schwarzman, who left alongside Peterson as a young partner, went on to become one of the wealthiest people in the world. The men who lost the battle for Lehman Brothers, did better than anyone who stayed. I keep coming back to one thing when I think about this story. Lehman Brothers was not destroyed by a crisis. It was destroyed by the absence of something.

[00:36:14]For 119 years, the Lehman family held the firm together, not because they were perfect, but because they owned it in a way that went beyond money. They carried the name on the door. When Robert Leman died and no one from the family stepped forward, the firm became a machine without a conscience. It could be run by anyone and eventually it was run by someone who confused confidence with invincibility.

[00:36:39]The Robert Leman wing at the Metropolitan Museum of Art is still open. The galleries still reflect the character of the family home on 54th Street just as Robert requested.

[00:36:51]Bodacelli, Renoir, Goya, Matis. The collection spans seven centuries of European art. It is the last place in the world where the layman name still means what it once did. Not leverage, not debt, not bankruptcy.