Lehman Brothers: 'A Colossal Failure'
My coauthor, Patrick Robinson, has published many successful books, including a number one New York Times bestseller, Lone Survivor.
Patrick had very little understanding of the basics of Wall Street such as the stock and bond markets much less the vastly more complex credit derivatives.
He was literally, the perfect complement to my inside knowledge, forcing me to make “extreme complexity” understandable to him. Instead of explaining things in Wall Street’s jargon-filled shorthand, Patrick made me spell it out clearly and simply. My hope then is that we have succeeded and that A Colossal Failureplays a useful role in making Wall Street and capitalism more transparent.
If investors don’t really understand how things really work deep in the engine room of an investment bank, then they are making sound investment decisions in a vacuum. Far too many people had their net worth destroyed.
Let’s not let it happen again, at least in my lifetime. One experience like we’ve had over the past two years is more than enough.
Lawrence G. McDonald was Vice President of convertible securities and distressed debt trading at Lehman Brothers until 2008; his prior career included convertible securities research and sales at Morgan Stanley and co-founding Convertbond.com, named by Forbes Magazine as "Best of the Web."
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