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Roula Khalaf, Editor of the FT, selects her favorite tales on this weekly publication.
Blissful Lehman Brothers Day to those that have a good time. It’s the seventeenth anniversary of what stays the largest chapter in American historical past.
However with annually’s passing, slightly extra of the story is forgotten. Hyperlink-rot has erased the cache of Lehman emails and memos launched in 2011 by legislation agency Jenner & Block to accompany its coroner’s report. Lehman’s personal funding analysis silo is lengthy gone, as are these of quite a few contemporaries. Discovering recordsdata on Web Archive is typically potential, however is sluggish and unreliable.
Individuals actually shouldn’t be so careless with historical past. For that cause, we’ve scanned a really previous HDD for Lehman-related analysis notes, and so forth, and uploaded a number of the recordsdata. Every thing’s from the second half of 2008.
Our objective isn’t to supply a complete view of the Nice Monetary Disaster, nor even a very insightful one. All we’re doing is making an attempt to protect stuff towards on-line erosion. Perhaps a number of the recordsdata archived beneath will likely be helpful to a monetary historian, whereas everybody else can consider them as digital memorabilia.
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Right here’s a Lehman sell-side observe from February 12 on leveraged loans, CDOs and subprime publicity on the massive US banks, excluding itself. And listed here are Lehman’s briefing notes for the securitised merchandise group’s weekly name of August 27, which incorporates IndyMac mortgage default eventualities.
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Right here’s a observe from Lehman’s banks analyst Jason Goldberg dated September 19, 4 days after the chapter, that talks about that day’s dead-cat bounce for the sector on hopes of asset nationalisation and short-selling bans. Goldberg was transferred to Barclays, the place he stays.
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Right here’s a observe from Morgan Stanley dated June 30 that initiates protection of Lehman Brothers with an “overweight” advice, which it reiterated on July 14 and August 27. The lead writer, Patrick Pinschmidt, left Morgan Stanley in 2009 and joined the Congressional Oversight Panel for market monitoring, regulation and TARP administration, then spent 5 years on the Treasury Division, the place he was first government director of the Monetary Stability Oversight Council.
In 2014, Pinschmidt advised the Home Committee on Monetary Companies that his “wrong call” was a symptom of how a lot “the market misjudged the impact of Lehman’s failure in terms of counterparties [and] other institutions”. He’s now a tech VC.
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Right here’s a observe from Fox-Pitt, Kelton’s David Trone dated July 14 during which he argues that Lehman has been focused by rumour-mongering quick sellers and its greatest plan of action can be to go non-public, “since it is the public equity markets that are the threat to the company’s survival”. Trone remained hopeful a couple of rescue by sale or restructuring on September 9. He now does investor relations.
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Right here’s a temporary observe dated August 28 from Dick Bove, a now-retired celebrity banks analyst, recommending shoppers of Ladenburg Thalman purchase Lehman shares primarily based on the prospect of a takeover.
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Disastrous quarterly outcomes from Lehman on September 10 made clear that one thing needed to occur imminently, although nobody was ready to guess what. That meant numerous “hold” suggestions. Right here’s fence-sitting from JPMorgan (September 10), Oppenheimer (September 10), Bernstein Analysis (September 11), UBS (September 11), KBW (September 11), Sandler O’Neill (September 11), HSBC (September 11), Financial institution of America (September 11), and Merrill Lynch (September 11).
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Right here’s a Deutsche Financial institution sector observe about banks’ wholesale funding dangers and capital adequacy from analyst Mike Mayo dated September 15, the identical day Lehman filed for chapter. It repeats a “hold” on the shares. Mayo’s now at Wells Fargo.
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Right here’s Albert Edwards at SocGen with an “economic and equity market meltdown imminent” alert to shoppers dated September 4, adopted by a “recent events should not come as a surprise” follow-up dated September 18. Edwards continues to be at SocGen.
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Nonetheless on the technique aspect, right here’s Citigroup hitting the wall of fear on September 15, UBS interesting for calm on September 17, and JPMorgan calling the underside for equities roughly 5 months too early on September 19.
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Lastly, right here’s an image of former FT Alphaville reporter Tracy Alloway on the morning of September 15. Alloway’s present whereabouts will not be identified.
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