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Lehman Brothers: In short

 

  • Lehman Brothers began in the mid-19th century – 1844, to be precise – as a general store. Henry Lehman was responsible for the first incarnation of the business; his brothers (Mayer and Emanuel) joined the business in 1850, laying the groundwork for what would become a financial industry powerhouse.
  • The 1990s were a time of great power and financial success for Lehman Brothers; the repeal of the Glass-Steagall Act allowed the company to engage in both commercial and investment banking services, a move that would ultimately lead to its downfall.
  • Lehman’s ultimate end came as a result of being utterly overwhelmed by mortgage-backed securities (MBS) that were mostly backed with subprime loans, many of which went into default.

 

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