[dennisw]

The problem with the “orderly bankruptcy” is that it would have required the US Government to put a significant amount of money on the table to keep Lehman solvent in the interim. Hindsight may tell us that we could have gotten our money back, but, at the time, we were tired of being called to cover the tracks of a company which had been spectacularly mismanaged. The sums, as I understand it, would have been greater than what we laid out for Bear,Stearns.

Lehman was spectacularly well managed. They often used 30-1 leverage. Richard Fuld took out $400 million in the last 6 years
Lehman paid out billions in bonuses and that's all that counts to those that got them

The true fault lies with Wall Street which, instead of creating exchanges for derivatives, they wanted to keep all the profit to themselves. There was just one problem: the success of their derivatives book depended on the assumption that they could never fail which, given the Bear, Stearns and Lehman fiascoes, was a woefully wrong supposition.

These guys aren't retards. They knew these alleged "assumptions" were cheesy but billions in bonuses got paid out based on them. So which "assumption" would you go with if you know it impacts on your yearly bonus?

[jeffers]

Lehman was playing rough. Can’t remember the exact details, but something along the lines of soliciting bidders, then using the bids to drive up to cost of a bailout, then using the new government offer to drive up the bids etc.

Per my brokers, Lehman got left out in the cold because they tried to squeeze all rescuers too hard.