Lehman's Fall: The What-Ifs Linger
What would the past year have been like if the government had bailed out Lehman Brothers? There's no easy answer
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Around every memory of Lehman Brothers' bankruptcy filing one year ago hangs the question: What if Lehman had been saved? Wouldn't we all be better off—and a little less stress-worn—than we are today?
It was Lehman's failure that was the immediate cause of the Panic of 2008, now a landmark in financial history. The credit markets had been rattled for months by the deterioration of the housing market and only a week earlier by the steps the federal government took to prop up mortgage financiers Fannie Mae (FNM) and Freddie Mac (FRE). But it was Lehman's bankruptcy that sent the global financial system into outright crisis mode.