What a Dick!


ex-Lehman CEO Dick Fuld

In the eyes of many people affected by the financial collapse of 2008, ex-Lehman Brothers CEO Dick Fuld is, well, his own first name.  They do not like the man.  But where is he now?

It seems like Mr. Fuld is staying relatively quiet in the world; this is slightly by choice and also because the world doesn’t want to hear him anymore.  Since the collapse of Lehman Brothers, Dick Fuld has stepped down as CEO and now has a completely different lifestyle.  Once a life full of luxuries and wealth at the top, Fuld is now a relatively hated man who is blamed for the Great Recession.  After being unemployed for a quarter of a year, Fuld finally got work in April of 2009 when he established Matrix Advisors.  This company was designed to consult companies on how to raise capital and mergers and acquisitions.  Some reports had Fuld working 260 hours of work a month at the firm at all hours of the day.  Then, as a way to try to keep his securities license valid, Fuld registered with Legend Securities.  Eventually, he “voluntarily” left Legend when he couldn’t get his state license or bring any business to the company.  So currently Dick Fuld is no longer an employee of Wall Street.

What else is happening in his life?  Well, he is wrapped in a severe amount of litigations involving the collapse.  For example, former debt and equity holders are leading a lawsuit against Lehman and the executives claiming they were given false or excluded important information.  Even though he is attempting to lay low, he HAS been spotted at a hockey game within the past year:

Dick Fuld Sitting at a Hockey Game (Black Suit)

The positive outcome of this hockey match is that he didn’t get physical with anyone this time.  To me, Fuld had no other choice but to go into hiding essentially.  His small business of Matrix Advisors at least keeps him busy.  I don’t think ANYONE would really want to see his face again anywhere near Wall Street for the next few years (or decades).  I think he is giving the people what they want…and they don’t want Dick.  Without licensing or positive relationships, Fuld will probably never get a job on Wall Street again.  A man with that many enemies shouldn’t really show his face.  For example, it is rumored Fuld was knocked out while running on the treadmill in the Lehman gym.  Granted it was at the time of the bankruptcy announcement, but he is clearly not a liked individual.  In the spirit of the American people, I leave you with this game so you can also enjoy the sweet, sweet pleasures of bashing the face of financial collapse:

Enjoy beating up Dick Fuld

Extra sources: Source 1 & Source 2

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Are you f****** kidding me?


Each and every one of us knows that the first bank to fail during the financial crisis was Lehman Brothers. I remember the day it happened as the news was pasted EVERYWHERE. Headlines told of mass extinction of the US financial system and noted that Lehman Brothers was the genesis of the great collapse. But what really happened? Continue reading

Trivia Questions & Answers From Class Discussion


As promised in class, here are the Questions and Answers to the trivia session.

Questions:

1.       Who was the CEO at the time of Lehman’s collapse?

2.       What does CDS stand for?

3.       True or False: Commercial paper usually matures in 270 days or more.

4.       Name the 3 possible players in the commercial-paper market.

5.       On what date (Month/day/year) did Lehman Brothers announce their bankruptcy?

6.       Which company was in danger in failing before Lehman, only to be bought be JP Morgan in a shotgun marriage?

7.       About how much did the commercial-paper market drop within a week of Lehman’s collapse?

8.       Where did investors flock to after losing confidence in the commercial-paper market?

9.       What kind of risk did the collapse of Lehman reveal within the market?

10.   What does CDO stand for?

11.   Before the collapse and subsequent decline in investor confidence, who was the largest buyer of commercial paper?

12.   Name the 2 companies that were mentioned as possible buyers of Lehman Brothers in the weekend before their demise.

13.   Lehman was a top 10 counterparty within the CDS market with contracts amounting to how much money?

14.   True or False: Lehman Brothers’ 3 main areas of business are investment banking, retail banking, and investment management.

15.   What type of portfolio was in so much trouble for Lehman Brothers that it scared away any possible investors?

16.   What is the name of the concept that claims shorting Lehman bonds was basically a self-fulfilling prophecy where speculation led to stock price decline which in turn led to Lehman defaulting?

 

 

 

 

Answers:

 

  1. Dick Fuld
  2. Credit Default Swap
  3. False (270 days or LESS)
  4. Issuers, Investors, Intermediaries
  5. September 15, 2008
  6. Bear Stearns
  7. $500 Billion
  8. Treasuries
  9. Systemic
  10. Collateralized Debt Obligation
  11. Money Markets
  12. Bank of America, Barclays
  13. $800 Billion
  14. False (Capital markets, not retail banking)
  15. Real-estate portfolio
  16. Reflexivity