Lehman Brothers’ Collapse

lehmanus_1477587c

“Lehman Brothers Holdings is closing its doors with more than $600 billion of debt — the biggest bankruptcy in U.S. history.” – Market Watch.

Lehman Brothers was one of the biggest global financial-services firms. The collaspe and its bankruptcy has shocked invester from around the world, provoking fluctuating stock market.

How has Lehman Brothers owed debt of $600 billion in the first place?

“This crisis is clearly deeper than anybody had imagined only a short time ago,” says Peter Stein, an associate editor at the Wall Street Journal in a CNN article.

During the attacks in September 11, 2001, it had its offices destroyed leaving them with great loss. Also, Lehman brothers were exposed to unsecured mortgages, and they had terrible debt caused by credit-crunch.

So these critical problems piled on until there was an economic crisis in 2008 to 2009 which exploded Lehman Brothers. So Lehman Brothers had problems that pervaded so deeply it eventually collapsed when there was an economic crisis which had ‘exploded’ Lehman Brothers.

Resources:

Watch Market: Lehman folds with record $613 billion debt

CNN: Lehman Brothers collapse stuns global markets

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: