174-636: Lehman Brothers Inc. ( / ˈ l iː m ən / LEE -mən ) was an American global financial services firm founded in 1850. Before filing for bankruptcy in 2008, Lehman was the fourth-largest investment bank in the United States (behind Goldman Sachs , Morgan Stanley , and Merrill Lynch ), with about 25,000 employees worldwide. It was doing business in investment banking, equity , fixed-income and derivatives sales and trading (especially U.S. Treasury securities ), research, investment management , private equity , and private banking . Lehman
348-476: A return on equity among the highest in the investment-banking industry. By the early 1980s, hostilities between the firm's investment bankers and traders prompted Peterson to promote Lewis Glucksman , the firm's President, COO and former trader, to be his co-CEO in May 1983. Glucksman introduced a number of changes that had the effect of increasing tensions, which when coupled with Glucksman's management style and
522-473: A "stripped clean" portion of Lehman for $ 1.75 billion, including most of Lehman's North America operations. On September 20, 2008, a revised version of the deal, a $ 1.35 billion (£700 million) plan for Barclays to acquire the core business of Lehman (mainly its $ 960-million headquarters, a 38-story office building in Midtown Manhattan , with responsibility for 9,000 former employees),
696-459: A $ 25-million after-tax charge and a $ 27-million reduction in goodwill . The firm said that poor market conditions in the mortgage space "necessitated a substantial reduction in its resources and capacity in the subprime space". In 2008, Lehman faced an unprecedented loss due to the continuing subprime mortgage crisis . Lehman's loss resulted from having held onto large positions in subprime and other lower-rated mortgage tranches when securitizing
870-461: A $ 27 million reduction in goodwill . Lehman said that poor market conditions in the mortgage space "necessitated a substantial reduction in its resources and capacity in the subprime space." In September 2007, Joe Gregory appointed Erin Callan as CFO. On March 16, 2008, after rival Bear Stearns was taken over by JPMorgan Chase in a fire sale , market analysts suggested that Lehman would be
1044-519: A 32-story, 1,050,000-square-foot (98,000 m) office building for a reported sum of $ 700 million. The building, located at 745 Seventh Avenue , had recently been completed, and not yet occupied, by rival Morgan Stanley . Lehman began moving into the new facility in January and finished in March 2002. The firm did not return to Three World Financial Center as its structural integrity had not been given
1218-521: A buyout by MidAmerican Energy , part of Berkshire Hathaway (headed by billionaire Warren Buffett ). The Federal Agricultural Mortgage Corporation or Farmer Mac said it would have to write off $ 52.4 million in Lehman debt in the form of senior debt securities it owned as a result of the bankruptcy. Farmer Mac said it might not be in compliance with its minimum capital requirements at the end of September. In Hong Kong, more than 43,700 individuals in
1392-560: A clean bill of health, and the company could not have waited for repairs to Three World Financial Center to conclude. After the attacks, Lehman's management placed increased emphasis on business continuity planning . Aside from its headquarters in Three World Financial Center, Lehman maintained operations-and-backoffice facilities in Jersey City , space that the firm considered leaving prior to 9/11. The space
1566-459: A combined 249 billion yen ($ 2.4 billion) in potential losses tied to the Lehman shock. Mizuho Trust & Banking cut its profit forecast by more than half, citing 11.8 billion yen in losses on bonds and loans linked to Lehman. The Bank of Japan Governor Masaaki Shirakawa said, "Most lending to Lehman Brothers was made by major Japanese banks, and their possible losses seem to be within the levels that can be covered by their profits," adding, "There
1740-657: A company in which there was "no accountability for failure". An article by journalist Matt Taibbi in Rolling Stone contended that naked short selling contributed to the demise of both Lehman and Bear Stearns . A study by finance researchers at the University of Oklahoma Price College of Business studied trading in financial stocks, including Lehman Brothers and Bear Stearns, and found "no evidence that stock price declines were caused by naked short selling". On Saturday, September 13, 2008, Timothy F. Geithner , then
1914-472: A downturn in the markets, resulted in a power struggle that ousted Peterson and left Glucksman as the sole CEO. Upset bankers, who had soured over the power struggle, left the company. Stephen A. Schwarzman , chairman of the firm's M&A committee, recalled in a February 2003 interview with Private Equity International that "Lehman Brothers had an extremely competitive internal environment, which ultimately became dysfunctional." The company suffered under
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#17327725285502088-511: A force in the subprime market . By 2003 Lehman made $ 18.2 billion in loans and ranked third in lending. By 2004, this number topped $ 40 billion. By 2006, Aurora and BNC were lending almost $ 50 billion per month. Lehman had morphed into a real estate hedge fund disguised as an investment bank . By 2008, Lehman had assets of $ 680 billion supported by only $ 22.5 billion of firm capital. From an equity position, its risky commercial real estate holdings were thirty times greater than capital. In such
2262-418: A force in the subprime market. By 2003 Lehman made $ 18.2 billion in loans and ranked third in lending. By 2004, this number topped $ 40 billion. By 2006, Aurora and BNC were lending almost $ 50 billion per month. By 2008, Lehman had assets of $ 680 billion supported by only $ 22.5 billion of firm capital. From an equity position, its risky commercial real estate holdings were thirty times greater than capital. In such
2436-493: A further $ 6 billion in capital. As a result, there was major management shakeup, in which Hugh "Skip" McGee III (head of investment banking) held a meeting with senior staff to strip CEO Richard Fuld and his lieutenants of their authority. Consequently, Joe Gregory agreed to resign as president and COO, and afterward he told Erin Callan that she had to resign as CFO. Callan was appointed CFO of Lehman in 2008 but served only for six months, before departing after her mentor Joe Gregory
2610-416: A highly leveraged structure, a 3 to 5 percent decline in real estate values would wipe out all capital. A March 2010 report by the court appointed examiner indicated that Lehman executives regularly used cosmetic accounting gimmicks at the end of each quarter to make its finances appear less shaky than they really were. This practice was a type of repurchase agreement that temporarily removed securities from
2784-420: A highly leveraged structure, a three- to five-percent decline in real estate values would wipe out all capital. Lehman borrowed significant amounts to fund its investing in the years leading to its bankruptcy in 2008, a process known as leveraging or gearing. A significant portion of this investment was in housing-related assets, making it vulnerable to a downturn in that market. One measure of this risk-taking
2958-593: A large American army in the process, and set up a network of bases inland. Although there were Loyalists within the Southern colonies, they were concentrated in larger coastal cities and were not great enough in number to overcome the revolutionaries. The British forces at the Battle of Monck's Corner and the Battle of Lenud's Ferry consisted entirely of Loyalists with the exception of the commanding officer ( Banastre Tarleton ). Both white and black Loyalists fought for
3132-718: A large area north of the city (along the Mississippi) becoming known as the German Coast. Still greater numbers immigrated to Texas (especially after 1848), where many bought land and were farmers. Many more German immigrants arrived in Texas after the Civil War, where they created the brewing industry in Houston and elsewhere, became grocers in numerous cities, and also established wide areas of farming. By 1840, New Orleans
3306-449: A leadership position for the firm, leaving no member of the Lehman family actively involved with the partnership. At the same time, Lehman was facing strong headwinds amidst the difficult economic environment of the early 1970s. By 1972, the firm was facing hard times and in 1973, Pete Peterson , chairman and chief executive officer of the Bell & Howell Corporation, was brought in to save
3480-421: A loss relating to the transactions" and warned that "actual losses could materially exceed current estimates." Freddie was still in the process of evaluating its exposure to Lehman and its affiliates under other business relationships. After Constellation Energy was reported to have exposure to Lehman, its stock went down 56% in the first day of trading having started at $ 67.87. The massive drop in stocks led to
3654-640: A money-management firm targeted at wealthy individuals. Its $ 2.5 billion of assets would join Neuberger's $ 50 billion in high-net-worth client assets under management. An article in The Wall Street Journal on September 15, 2008, announcing that Lehman Brothers Holdings filed for Chapter 11 bankruptcy protection , quoted Lehman officials regarding Neuberger Berman: Neuberger Berman LLC and Lehman Brothers Asset Management will continue to conduct business as usual and will not be subject to
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#17327725285503828-440: A naval flotilla was sent to Charleston harbor, and the threat of landing ground troops was used to compel the collection of tariffs. A compromise was reached by which the tariffs would be gradually reduced, but the underlying argument over states' rights continued to escalate in the following decades. The second issue concerned slavery, primarily the question of whether slavery would be permitted in newly admitted states. The issue
4002-581: A pending credit downgrade due to its heavy position in subprime mortgages, the Federal Reserve summoned several banks to negotiate financing for its reorganization. These discussions failed, and Lehman filed a Chapter 11 petition that remains the largest bankruptcy filing in U.S. history , involving more than US$ 600 billion in assets. The bankruptcy triggered a 4.5% one-day drop in the Dow Jones Industrial Average , then
4176-574: A potential liability of $ 2.5 billion to be paid as severance , if it chooses not to retain some Lehman employees beyond the guaranteed 90 days. On September 22, 2008, Nomura Holdings, Inc. announced it agreed to acquire Lehman Brothers' franchise in the Asia Pacific region including Japan, Hong Kong and Australia. The following day, Nomura announced its intentions to acquire Lehman Brothers' investment banking and equities businesses in Europe and
4350-523: A potential liability of $ 2.5 billion to be paid as severance , if it chooses not to retain some Lehman employees beyond the guaranteed 90 days. Bankruptcy of Lehman Brothers The bankruptcy of Lehman Brothers , also known as the Crash of '08 and the Lehman Shock on September 15, 2008, was the climax of the subprime mortgage crisis . After the financial services firm was notified of
4524-459: A short time during Reconstruction. There were thousands of people on the move, as African Americans tried to reunite families separated by slave sales, and sometimes migrated for better opportunities in towns or other states. Other freed people moved from plantation areas to cities or towns for a chance to get different jobs. At the same time, whites returned from refuges to reclaim plantations or town dwellings. In some areas, many whites returned to
4698-637: A significant and controlling interest in Lehman's North American investment-banking and trading divisions, along with its New York headquarters building. On September 20, 2008, a revised version of that agreement was approved by U.S. Bankruptcy Court Judge James M. Peck. The next week, Nomura Holdings announced that it would acquire Lehman Brothers' franchise in the Asia–Pacific region, including Japan , Hong Kong and Australia , as well as Lehman Brothers' investment banking and equities businesses in Europe and
4872-485: A similar emergency." Luc Despins, the creditors committee counsel, said: "The reason we're not objecting is really based on the lack of a viable alternative. We did not support the transaction because there had not been enough time to properly review it." In the amended agreement, Barclays would absorb $ 47.4 billion in securities and assume $ 45.5 billion in trading liabilities. Lehman's attorney Harvey R. Miller of Weil, Gotshal & Manges , said "the purchase price for
5046-548: A similar emergency." Luc Despins, then a partner at Milbank, Tweed, Hadley & McCloy , the creditors committee counsel, said: "The reason we're not objecting is really based on the lack of a viable alternative. We did not support the transaction because there had not been enough time to properly review it." In the amended agreement, Barclays would absorb $ 47.4 billion in securities and assume $ 45.5 billion in trading liabilities. Lehman's attorney Harvey R. Miller of Weil, Gotshal & Manges , said "the purchase price for
5220-586: A story in The New York Times revealed that Lehman had used a small company, Hudson Castle , to move a number of transactions and assets off Lehman's books as a means of manipulating accounting numbers of Lehman's finances and risks. One Lehman executive described Hudson Castle as an "alter ego" of Lehman. According to the story, Lehman owned one quarter of Hudson; Hudson's board was controlled by Lehman, most Hudson staff members were former Lehman employees. On February 22, 2011, Judge James M. Peck of
5394-520: A total of 260,000, out of a total white Southern population at the time of around 5.5 million. Based on 1860 census figures, 8% of all white males aged 13 to 43 died in the war, including 6% in the North and about 18% in the South. Northern military deaths were greater than Southern military deaths in absolute numbers, but were two-thirds smaller in terms of proportion of the population affected. After
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5568-509: A unit of Canada's Great-West Lifeco , shut a $ 12.3 billion money-market fund as it faced "significant redemption pressure" on September 17, 2008. Evergreen Investments said its parent Wachovia Corporation would "support" three Evergreen money-market funds to prevent their shares from falling. This move to cover $ 494 million of Lehman assets in the funds also raised fears about Wachovia's ability to raise capital. Close to 100 hedge funds used Lehman as their prime broker and relied largely on
5742-467: Is no concern that the latest events will threaten the stability of Japan's financial system." During bankruptcy proceedings a lawyer from The Royal Bank of Scotland Group said the company was facing between $ 1.5 billion and $ 1.8 billion in claims against Lehman partially based on an unsecured guarantee from Lehman and connected to trading losses with Lehman subsidiaries, Martin Bienenstock. Lehman
5916-485: Is not shirking accountability for recent performance." Lehman Brothers Investment Management Director George Herbert Walker IV dismissed the proposal, going so far as to actually apologize to other members of the Lehman Brothers executive committee for the idea having been suggested. He wrote, "Sorry team. I am not sure what's in the water at Neuberger Berman. I'm embarrassed and I apologize." During hearings on
6090-558: The 15th Amendment (which extended the right to vote to African American males), African Americans in the South were made free citizens and were given the right to vote. Under Federal protection, white and black Republicans formed constitutional conventions and state governments. Among their accomplishments were creating the first public education systems in Southern states, and providing for welfare through orphanages, hospitals and similar institutions. Northerners came south to participate in politics and business. Some were representatives of
6264-609: The British Isles before the American Revolution . In the 1980 census , 34% of Southerners reported that they were of English ancestry; English was the largest reported European ancestry in every Southern state by a large margin. The early colonists engaged in warfare , trade, and cultural exchanges. Those living in the backcountry were more likely to encounter Creek Indians , Cherokee , and Choctaws and other regional native groups. The oldest university in
6438-804: The Chesapeake Bay . The next region to be settled was the Deep South, beginning in Province of Carolina and later the Province of Georgia . The last region to be settled was Appalachia, also settled by the Scotch-Irish . King Charles II of England granted the Charter of Carolina in 1663 for land south of the British Colony of Virginia and north of Spanish Florida . He granted the land to eight lords proprietor . Charles granted
6612-495: The Civil War and Reconstruction era (1865–1877). Following effects included thousands of lynchings (mostly from 1880 to 1930), a segregated system of separate schools and public facilities established from Jim Crow laws that remained until the 1960s, and the widespread use of poll taxes and other methods to deny black and poor people the ability to vote or hold office until the 1960s. Scholars have characterized pockets of
6786-509: The Federal Reserve Bank of New York , called a meeting on the future of Lehman, which included the possibility of an emergency liquidation of its assets. Bankers representing all the major Wall Street firms were in attendance. The meeting goal was to find a private solution in rescuing Lehman and extinguish the flame of the global financial crisis. Lehman reported that it had been in talks with Bank of America and Barclays for
6960-621: The Freedmen's Bureau and other agencies of Reconstruction; some were humanitarians with the intent to help black people. Some were adventurers who hoped to benefit themselves by questionable methods. They were all condemned with the pejorative term of carpetbagger . Some Southerners would also take advantage of the disrupted environment and made money off various schemes, including bonds and financing for railroads. White Southerners who supported Reconstruction policies and efforts became known as scalawags . Secret vigilante organizations such as
7134-484: The Hong Kong Association of Banks , agreed to buy back the bonds, which were priced using an agreed upon methodology based on its estimated current value. Neuberger Berman Inc., through its subsidiaries, primarily Neuberger Berman, LLC, is an investment-advisory firm founded in 1939 by Roy R. Neuberger and Robert Berman, to manage money for high-net-worth individuals . In the decades that followed,
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7308-552: The Ku Klux Klan – an organization sworn to perpetuate white supremacy – had arisen quickly after the war's end in the 1860s, and used lynching , physical attacks, house burnings and other forms of intimidation to keep African Americans from exercising their political rights. Although the first Klan was disrupted by prosecution by the Federal government in the early 1870s, other groups persisted. By
7482-547: The Middle East . The deal became effective on October 13, 2008. In 1844, 23-year-old Heyum Lehmann, who changed his name to Henry Lehman , the son of a Jewish cattle merchant, emigrated to the United States from Rimpar , Bavaria . He settled in Montgomery, Alabama , where he opened a dry-goods store, "H. Lehman". In 1847, following the arrival of his brother Emanuel Lehman , the firm became "H. Lehman and Bro." With
7656-474: The New York Stock Exchange halting trade of Constellation. The next day, as the stock plummeted as low as $ 13 per share, Constellation announced it was hiring Morgan Stanley and UBS to advise it on "strategic alternatives", suggesting a buyout. While rumors suggested French power company Électricité de France would buy the company or increase its stake, Constellation ultimately agreed to
7830-626: The Patriot cause . Virginia would provide leaders such as commander-in-chief George Washington , and the author of the Declaration of Independence, Thomas Jefferson . In 1780 and 1781, the British largely halted reconquest of the northern states and concentrated on the south, where they were told there was a large Loyalist population ready to leap to arms once the royal forces arrived. The British took control of Savannah and Charleston, capturing
8004-573: The S&;P 500 down 3.4% on September 9. The Dow Jones lost 300 points the same day on investors' concerns about the security of the bank. The U.S. government did not announce any plans to assist with any possible financial crisis that emerged at Lehman. The next day, Lehman announced a loss of $ 3.9 billion and its intent to sell off a majority stake in its investment-management business, which included Neuberger Berman . The stock slid seven percent that day. Lehman, after earlier rejecting questions on
8178-936: The Southern States , the American South , the Southland , Dixieland , or simply the South ) is one of the four census regions defined by the United States Census Bureau . It is between the Atlantic Ocean and the Western United States , with the Midwestern and Northeastern United States to its north and the Gulf of Mexico and Mexico to its south. Historically, the South was defined as all states south of
8352-533: The United States Census Bureau , A survey conducted by social geographers in 2010 selected thirteen states as the cultural south; Mississippi, Alabama, Louisiana, Arkansas, Georgia, Kentucky, North Carolina, South Carolina, Tennessee, Florida, Virginia, West Virginia, and Oklahoma. The Southern region of the United States includes sixteen states. As of 2010, an estimated 114,555,744 people, or thirty seven percent of all U.S. residents, lived in
8526-461: The green anole , the venomous cottonmouth snake, and the American alligator , mammals like the American black bear , the swamp rabbit , and the nine-banded armadillo , and birds such as the roseate spoonbill and the extinct but symbolic carolina parakeet . The question of how to define the boundaries and subregions in the South has long been the focus of research and debate. As defined by
8700-563: The initial public offering of the first television manufacturer , DuMont Laboratories , and helped fund the Radio Corporation of America (RCA). It also helped finance the rapidly growing oil industry, including the companies Halliburton and Kerr-McGee . In the 1950s, Lehman underwrote the IPO of Digital Equipment Corporation . Later, it arranged the acquisition of Digital by Compaq . Robert Lehman died in 1969 after 44 years in
8874-424: The largest bankruptcy filing in U.S. history , with Lehman holding over $ 600 billion in assets. On September 22, 2008, a revised proposal to sell the brokerage part of Lehman Brothers holdings of the deal was put before the bankruptcy court, with a $ 1.3666 billion (£700 million) plan for Barclays to acquire the core business of Lehman Brothers (mainly Lehman's $ 960 million Midtown Manhattan office skyscraper),
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#17327725285509048-531: The south-central and southeastern states. For example, California, which is geographically in the southwestern part of the country, is not considered part of the South. However, the geographically southeastern state of Georgia is. The South, being home to some of the most racially diverse areas in the United States, is known for having developed its own distinct culture , with different customs, fashion, architecture , musical styles , and cuisines , which have distinguished it in many ways from other areas of
9222-686: The $ 1 billion purchase of E.F. Hutton to form Shearson Lehman Hutton . In 1989, Shearson backed F. Ross Johnson 's management team in its attempted management buyout of RJR Nabisco , but were ultimately outbid by private equity firm Kohlberg Kravis Roberts , who was backed by Drexel Burnham Lambert . In 1993, under newly appointed CEO Harvey Golub , American Express began to divest itself of its banking and brokerage operations. It sold its retail brokerage and asset management operations to Primerica and in 1994 it spun off Lehman Brothers Kuhn Loeb in an initial public offering , as Lehman Brothers Holdings, Inc. After being spun off, Dick Fuld became CEO of
9396-606: The 16th century, reaching a peak in the late 17th century, but the population was small because the Spaniards were relatively uninterested in agriculture, and Florida had no mineral resources. There were regional differences in the Southern colonies, with the three main regions of Tidewater , the Deep South , and Appalachia . The first region to be settled was Tidewater, containing the low-lying plains of southeast Virginia , northeastern North Carolina , southern Maryland and
9570-621: The 18th-century Mason–Dixon line , the Ohio River , and 36°30′ parallel . Within the South are different subregions such as the Southeast , South Central , Upper South , and Deep South . Maryland , Delaware , Washington, D.C. , and Northern Virginia have become more culturally, economically, and politically aligned in certain aspects with the Northeastern United States and are sometimes identified as part of
9744-741: The British Governor Dunmore of Virginia's promise of freedom for service. Many others were removed by Loyalist owners and became slaves elsewhere in the British Empire. Between 1770 and 1790, there was a sharp decline in the percentage of blacks – from 61% to 44% in South Carolina and from 45% to 36% in Georgia. In addition, some slaveholders were inspired to free their slaves after the Revolution. They were moved by
9918-737: The British Navy. The British Navy did arrive, but so did a stronger French fleet, and Cornwallis was trapped. American and French armies, led by George Washington, forced Cornwallis to surrender his entire army in Yorktown, Virginia in October 1781, effectively winning the North American part of the war. The Revolution provided a shock to slavery in the South and other regions of the new country. Thousands of slaves took advantage of wartime disruption to find their own freedom, catalyzed by
10092-637: The British at the Battle of Kemp's Landing in Virginia. Led by Nathanael Greene and other generals, the Americans engaged in Fabian tactics designed to wear down the British invasion force and to neutralize its strong points one by one. There were numerous battles large and small, with each side claiming some victories. By 1781, however, British General Cornwallis moved north to Virginia, where an approaching army forced him to fortify and await rescue by
10266-921: The British government (in particular, the Chancellor of the Exchequer Alistair Darling and the CEO of the Financial Services Authority Hector Sants ) refused to allow the transaction at the last minute, quoting stockholder regulations in the UK, despite a deal having apparently been completed. The next day, Sunday, September 14, the International Swaps and Derivatives Association (ISDA) offered an exceptional trading session to allow market participants to offset positions in various derivatives on
10440-697: The Census definition, two U.S. territories located southeast of Florida ( Puerto Rico and the U.S. Virgin Islands ) are sometimes included as part of the Southern United States. The Federal Aviation Administration includes Puerto Rico and the U.S. Virgin Islands as part of the South, as does the Agricultural Research Service and the U.S. National Park Service . The first well-dated evidence of human occupation in
10614-479: The Civil War, the South was devastated in terms of infrastructure and economy. Because of states' reluctance to grant voting rights to freedmen, Congress instituted Reconstruction governments. It established military districts and governors to rule over the South until new governments could be established. Many white Southerners who had actively supported the Confederacy were temporarily disenfranchised. Rebuilding
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#173277252855010788-553: The Confederacy. Though early in the war, the Confederacy controlled more than half of Kentucky and the southern portion of Missouri. By March 1862, the Union largely controlled all the border state areas, had shut down all commercial traffic from all Confederate ports, had prevented European recognition of the Confederate government, and was poised to seize New Orleans. The rugged mountainous East Tennessee region attempted to rejoin
10962-642: The East Coast to the Great Lakes. Some noted explorers who encountered and described the Mississippian culture, by then in decline, included Pánfilo de Narváez (1528), Hernando de Soto (1540), and Pierre Le Moyne d'Iberville (1699). Native American descendants of the mound-builders include Alabama , Apalachee , Caddo , Cherokee , Chickasaw , Choctaw , Creek , Guale , Hitchiti , Houma , and Seminole peoples, all of whom still reside in
11136-497: The Lehman Brothers' top people forgo multimillion-dollar bonuses to "send a strong message to both employees and investors that management is not shirking accountability for recent performance". Lehman Brothers Investment Management Director George Herbert Walker IV dismissed the proposal, going so far as to actually apologize to other members of the Lehman Brothers executive committee for the idea of bonus reduction having been suggested. He wrote, "Sorry team. I am not sure what's in
11310-468: The London business and the U.S. holding company filed for bankruptcy, positions held by those hedge funds at Lehman were frozen. As a result, the hedge funds were forced to de-lever and sit on large cash balances, inhibiting chances at further growth. This in turn created further market dislocation and overall systemic risk, resulting in a $ 737 billion decline in collateral outstanding in the securities lending market. In Japan, banks and insurers announced
11484-403: The Middle East. A few weeks later it was announced that conditions to the deal had been met, and the deal became legally effective on Monday, October 13. In 2007, non-US subsidiaries of Lehman Brothers were responsible for over 50% of global revenue produced. The Dow Jones closed down just over 500 points (−4.4%) on September 15, 2008, at the time the largest drop by points in a single day since
11658-400: The Mississippi River in 1863. In the East, however, the Confederate Army under Robert E. Lee beat off attack after attack in its defense of their capital at Richmond. But when Lee tried to move north, he was repulsed (and nearly captured) at Sharpsburg (1862) and Gettysburg (1863). The Confederacy had the resources for a short war, but was unable to finance or supply a longer war. It reversed
11832-429: The New York Stock Exchange delisted Lehman Brothers. On March 16, 2011 some three years after filing for bankruptcy and following a filing in a Manhattan U.S. bankruptcy court , Lehman Brothers Holdings Inc announced it would seek creditor approval of its reorganization plan by October 14 followed by a confirmation hearing to follow on November 17. On September 16, 2008, Barclays PLC announced that they would acquire
12006-414: The Northeast or Mid-Atlantic . The United States Census Bureau continues to define all four places as formally being in the South. To account for cultural variations across the region, some scholars have proposed definitions of the South that do not coincide neatly with state boundaries. The South does not precisely correspond to the entire geographic south of the United States, but primarily includes
12180-436: The Primary Reserve Fund was the first time since 1994 that a money-market fund had dropped below the $ 1-per-share level. On Monday, September 15, 2008, the market staged a run on AIG with shares plummeting 61 percent. Shareholders also fled from Goldman Sachs and Morgan Stanley. Two weeks later, the Fed agreed to give the bank holding company status which provided vital access to the Fed discount window. Putnam Investments ,
12354-409: The South and Eastern United States and were sent to Oklahoma. By 1856, the South had lost control of Congress, and was no longer able to silence calls for an end to slavery – which came mostly from the more populated, free states of the North. The Republican Party, founded in 1854, pledged to stop the spread of slavery beyond those states where it already existed. After Abraham Lincoln
12528-518: The South generally has a reputation as hot and humid, with long summers and short, mild winters. Most of the South—except for the areas of higher elevations and areas near the western, southern, and some northern fringes—falls in the humid subtropical climate zone. Crops grow readily in the South due to its climate consistently providing growing seasons of at least six months before the first frost. Some common environments include bayous and swamplands,
12702-445: The South include: Historically, the South was defined as all states south of the 18th century Mason–Dixon line , the Ohio River , and 36°30′ parallel . Newer definitions of the South today are harder to define, due to cultural and sub-regional differences throughout the region; however, definitions usually refer to states that are in the southeastern and south central geographic region of the United States. Although not included in
12876-620: The South, the College of William & Mary , was founded in 1693 in Virginia; it pioneered in the teaching of political economy and educated future U.S. Presidents Jefferson , Monroe and Tyler , all from Virginia. Indeed, the entire region dominated politics in the First Party System era: for example, four of the first five presidents – Washington , Jefferson , Madison and Monroe – were from Virginia. The two oldest public universities are also in
13050-449: The South, the nation's most populous region. The Census Bureau defined three smaller divisions: The Council of State Governments , an organization for communication and coordination between states, includes in its South regional office the states of Alabama, Arkansas, Florida, Georgia, Kentucky, Louisiana, Mississippi, Missouri, North Carolina, Oklahoma, South Carolina, Tennessee, Texas, Virginia and West Virginia. Other terms related to
13224-711: The South. Other peoples whose ancestral links to the Mississippian culture are less clear, but those who were in the region before the European incursion include the Catawba and the Powhatan . The arrival of European settlers caused a massive population decline in Native Americans , due to Europeans unknowingly spreading diseases that the natives had no immunities towards, numerous violent conflicts, and forcibly relocating them. The predominant culture of
13398-604: The South: the University of North Carolina (1789) and the University of Georgia (1785). Slavery was legal in all of the Thirteen Colonies prior to the American Revolution in 1776. Britain had slave island colonies in the Caribbean , including Jamaica , Barbados , Nevis , and Antigua , which provided a steady flow of profits from the slave labor that produced sugar. The Southern Colonies differed in that
13572-481: The Southern United States as being authoritarian enclaves from Reconstruction until the Civil Rights Act of 1964 . When looked at broadly, studies have shown that Southerners tend to be more conservative than most non-Southerners, with liberalism being mostly predominant in places with a Black majority or urban areas in the South. Although historically a Democratic stronghold , most states in
13746-458: The Southern transportation system depended primarily on river and coastal traffic by boat; both were shut down by the Union Navy . The small railroad system virtually collapsed, so that by 1864 internal travel was so difficult that the Confederate economy was crippled. The Confederate cause was hopeless by the time Atlanta fell and William T. Sherman marched through Georgia in late 1864, but
13920-482: The U.S. Bankruptcy Court in the Southern District of New York rejected claims by lawyers for the Lehman estate that Barclays had improperly reaped a windfall from the section 363 sale. "The sale process may have been imperfect, but it was still adequate under the exceptional circumstances of Lehman Week." Southern United States The Southern United States (sometimes Dixie , also referred to as
14094-547: The Union as a new state , having opposed secession and slavery compared to most of Tennessee. In the four years of war 1861–65 the South was the primary battleground, with all but two of the major battles taking place on Southern soil. Union forces led numerous campaigns into the western Confederacy, controlling the border states in 1861, the Tennessee River, the Cumberland River and New Orleans in 1862, and
14268-639: The United States. From 1860 to 1861, eleven Southern states plus an additional two Southern states that were claimed and partially controlled seceded from the Union , forming the Confederate States of America . Following the American Civil War , these states were subsequently added back to the Union. Sociological research indicates that Southern collective identity stems from political, historical, demographic, and cultural distinctiveness from
14442-413: The United States. Jeffrey Spector, a real-estate analyst at UBS , said that in markets with apartment buildings that compete with Archstone, "there is no question that if you need to sell assets, you will try to get ahead" of the Lehman selloff, adding "Every day that goes by there will be more pressure on pricing." Several money funds and institutional cash funds had significant exposure to Lehman with
14616-411: The arguments over states' rights that culminated in secession and the Civil War. One of these issues concerned the protective tariffs enacted to assist the growth of the manufacturing sector, primarily in the North. In 1832, in resistance to federal legislation increasing tariffs, South Carolina passed an ordinance of nullification , a procedure in which a state would, in effect, repeal a Federal law. Soon
14790-439: The arrival of their youngest brother, Mayer Lehman , in 1850, the firm changed its name again and "Lehman Brothers" was founded. During the 1850s, cotton was one of the most important crops in the United States, and was Alabama's highest-grossing cash crop. Until the U.S. Civil War, nearly all U.S. cotton was produced by slave labor , and by the 1860 census, slaves constituted nearly 45% of Alabama's total population. Mayer Lehman
14964-511: The bank's orderly liquidation and the Federal Reserve, in turn, agreed to a swap of lower-quality assets in exchange for loans and other assistance from the government. The morning witnessed scenes of Lehman employees removing files, items with the company logo, and other belongings from the world headquarters at 745 Seventh Avenue. The spectacle continued throughout the day and into the following day. Brian Marsal, co-chief executive of
15138-540: The bank's rapid failure. Bank of America's rumored involvement also appeared to end as federal regulators resisted its request for government involvement in Lehman's sale. By Sunday, September 14, after the Barclays deal fell through, the news of impending doom swept through Lehman, and many employees arrived at the headquarters to clean out their offices. By Sunday afternoon, the government summoned Harvey Miller of Weil, Gotshal & Manges to file for bankruptcy before
15312-457: The bankruptcy case of the parent company, and its portfolio management, research and operating functions remain intact. In addition, fully paid securities of customers of Neuberger Berman are segregated from the assets of Lehman Brothers and aren't subject to the claims of Lehman Brothers Holdings' creditors, Lehman said. Just before the collapse of Lehman Brothers, executives at Neuberger Berman sent e-mail memos suggesting, among other things, that
15486-565: The bankruptcy filing by Lehman Brothers and bailout of AIG before the House Committee on Oversight and Government Reform, former Lehman Brothers CEO Richard Fuld said a host of factors including a crisis of confidence and naked short-selling attacks followed by false rumors contributed to both the collapse of Bear Stearns and Lehman Brothers. House committee Chairman Henry Waxman said the committee received thousands of pages of internal documents from Lehman and these documents portray
15660-548: The city had invested in HK$ 15.7 billion of "guaranteed mini-bonds " (迷你債券) from Lehman. Many claimed that banks and brokers mis-sold them as low-risk. However, bankers noted that the minibonds are indeed low-risk instruments since they were backed by Lehman Brothers, which until just months before its collapse was a venerable member of Wall Street with high credit and investment ratings, and many banks accepted minibonds as collateral for loans and credit facilities. Another HK$ 3 billion
15834-634: The codes are not an exact copy, such as Virginia and Maryland , the influence of the Barbados Slave Code can be traced throughout various provisions. In the mid-to-late-18th century, large groups of Ulster Scots (later called the Scotch-Irish ) and people from the Anglo-Scottish border region immigrated and settled in the back country of Appalachia and the Piedmont . They were the largest group of non-English immigrants from
16008-421: The company's balance sheet . However, unlike typical repurchase agreements, these deals were described by Lehman as the outright sale of securities and created "a materially misleading picture of the firm's financial condition in late 2007 and 2008". In August 2007, the firm closed its subprime lender , BNC Mortgage, eliminating 1,200 positions in 23 locations, and took an after-tax charge of $ 25 million and
16182-460: The company's possible sale. The New York Times reported on September 14, 2008, that Barclays had ended its bid to purchase all or part of Lehman and a deal to rescue the bank from liquidation collapsed. It emerged subsequently that a deal had been vetoed by the Bank of England and the UK's Financial Services Authority . Leaders of major Wall Street banks continued to meet late that day to prevent
16356-489: The company. Fuld steered Lehman through the 1997 Asian Financial Crisis , and when the Long Term Capital Management hedge fund collapsed in 1998. In 2001, the firm acquired the private-client services, or "PCS", business of Cowen & Co. and later, in 2003, aggressively re-entered the asset-management business, which it had exited in 1989. Beginning with $ 2 billion in assets under management ,
16530-582: The condition of a Lehman bankruptcy later that day. Although the bankruptcy filing missed the deadline, many dealers honored the trades they made in the special session. Shortly before 1 am Monday morning (UTC−5), Lehman Brothers Holdings announced it would file for Chapter 11 bankruptcy protection citing bank debt of $ 613 billion, $ 155 billion in bond debt, and assets worth $ 639 billion. It further announced that its subsidiaries would continue to operate as normal. A group of Wall Street firms agreed to provide capital and financial assistance for
16704-448: The days following the attacks on September 11, 2001. This drop was exceeded by a 6.98% plunge on September 29, 2008. Lehman's bankruptcy was expected to cause some depreciation in the price of commercial real estate. The prospect for Lehman's $ 4.3 billion in mortgage securities getting liquidated sparked a selloff in the commercial mortgage-backed securities (CMBS) market. Additional pressure to sell securities in commercial real estate
16878-421: The disintegration, and Glucksman was pressured into selling the firm. Shearson/American Express , an American Express -owned securities company focused on brokerage rather than investment banking, acquired Lehman in 1984, for $ 360 million. On May 11, the combined firms became Shearson Lehman/American Express. From 1983 to 1990, Peter A. Cohen was CEO and chairman of Shearson Lehman Brothers, where he led
17052-581: The eleven Confederate states, states such as Tennessee (especially East Tennessee ), Virginia (which included West Virginia at the time), and North Carolina were home to the largest populations of Unionists. Many areas of Southern Appalachia harbored pro-Union sentiment as well. As many as 100,000 men living in states under Confederate control would serve in the Union Army or pro-Union guerrilla groups. Although Southern Unionists came from all classes, most differed socially, culturally, and economically from
17226-553: The end of the 15th century – the Mississippian culture . The Mississippian culture was a complex, mound-building Native American culture that flourished in what is now the Southeastern United States from approximately 800 AD to 1500 AD. Natives had elaborate and lengthy trading routes connecting their main residential and ceremonial centers extending through the river valleys and from
17400-509: The ensuing months, the firm spread its operations across New York City in over 40 temporary locations. The investment-banking division converted the first-floor lounges, restaurants, and all 665 guest rooms of the Sheraton Manhattan Hotel into office space. The bank also experimented with flextime (to share office space) and remote work via virtual private networking after the attacks. In October 2001, Lehman purchased
17574-413: The entire capitalization spectrum, as well as new investment categories, such as international, real-estate investment trusts and high-yield investments. In addition, with the creation of a nationally and several state-chartered trust companies, the firm became able to offer trust and fiduciary services. In 2016, the firm had approximately $ 246 billion in assets under management . In October 1999,
17748-624: The financial-advisory business. Lehman became a member of the Coffee Exchange as early as 1883 and finally the New York Stock Exchange in 1887. In 1899, it underwrote its first public offering, the preferred and common stock of the International Steam Pump Company . Despite the offering of International Steam, the firm's real shift from being a commodities house to a house of issue did not begin until 1906. In that year, under Emanuel's son Philip Lehman ,
17922-836: The firm acquired the Crossroads Group , the fixed-income division of Lincoln Capital Management and Neuberger Berman . These businesses, together with the PCS business and Lehman's private-equity business, comprised the Investment Management Division, which generated approximately $ 3.1 billion in net revenue. During the subprime mortgage crisis , Fuld kept his job while CEOs of rivals like Bear Stearns , Merrill Lynch , and Citigroup were forced to resign. In addition, Lehman's board of directors, which included retired CEOs like Vodafone 's Christopher Gent and IBM 's John Akers were reluctant to challenge Fuld as
18096-580: The firm conducted an initial public offering of its shares and commenced trading on the New York Stock Exchange , under the ticker symbol "NEU". In July 2003, shortly after the retired Mr. Neuberger's 100th birthday, the company announced that it was in merger discussions with Lehman Brothers Holdings Inc. These discussions ultimately resulted in the firm's acquisition by Lehman on October 31, 2003, for approximately $ 2.63 billion in cash and securities. On November 20, 2006, Lehman announced its Neuberger Berman subsidiary would acquire H. A. Schupf & Co.,
18270-415: The firm for financing. In an attempt to meet their own credit needs, Lehman Brothers International routinely re-hypothecated the assets of their hedge funds clients that utilized their prime brokerage services. Lehman Brothers International held close to $ 40 billion of clients assets when it filed for Chapter 11 Bankruptcy. Of this, $ 22 billion had been re-hypothecated. As administrators took charge of
18444-531: The firm partnered with Goldman, Sachs & Co. , to bring the General Cigar Co. to market, followed closely by Sears, Roebuck and Company . Among these were F.W. Woolworth Company , May Department Stores Company , Gimbel Brothers, Inc. , R.H. Macy & Company , The Studebaker Corporation , the B.F. Goodrich Co. , and Endicott Johnson Corporation . Following Philip Lehman's retirement in 1925, his son Robert "Bobbie" Lehman took over as head of
18618-509: The firm teamed up with a cotton merchant named John Durr to form Lehman, Durr & Co. Following the war the company helped finance Alabama's reconstruction . The firm's headquarters was eventually moved to New York City, where it helped found the New York Cotton Exchange in 1870, commodifying the crop; Emanuel sat on the board of governors until 1884. The firm also dealt in the emerging market for railroad bonds and entered
18792-496: The firm's growth mirrored that of the asset-management industry as a whole. In 1950, it introduced one of the first no-load mutual funds in the United States, the Guardian Fund , and also began to manage the assets of pension plans and other institutions. Historically known for its value-investing style, in the 1990s the firm began to diversify its competencies to include additional value and growth investing , across
18966-684: The firm's share price spiraled lower. In May 2008, prior to going bankrupt, the firm had $ 639 billion in assets. On September 11, 2001, Lehman occupied three floors (38–40) of 1 World Trade Center , where one of its employees was killed in the terrorist attacks of that day. Its global headquarters in Three World Financial Center were severely damaged and rendered unusable by falling debris, displacing over 6,500 employees. Trading operations moved to Jersey City , New Jersey . When stock markets reopened on September 17, 2001, Lehman's sales and trading capabilities were restored. In
19140-419: The firm. Under Peterson's leadership as chairman and CEO, the firm acquired Abraham & Co. in 1975, and two years later merged with Kuhn, Loeb & Co. , to form Lehman Brothers, Kuhn, Loeb Inc. , the country's fourth-largest investment bank, behind Salomon Brothers , Goldman Sachs and First Boston . Peterson led the firm from significant operating losses to five consecutive years of record profits with
19314-492: The firm. During Bobbie's tenure, the company weathered the capital crisis of the Great Depression by focusing on venture capital while the equities market recovered. In 1924, John M. Hancock became the first non-family member to join the firm, followed by Monroe C. Gutman and Paul Mazur, who became partners in 1927. By 1928, the firm had moved to its One William Street location. In the 1930s, Lehman underwrote
19488-549: The firms had improperly associated analyst compensation with the firms' investment-banking revenues, and promised favorable, market-moving research coverage, in exchange for underwriting opportunities. The settlement, known as the "global settlement", provided for total financial penalties of $ 1.4 billion, including $ 80 million against Lehman, and structural reforms including a complete separation of investment banking departments from research departments, no analyst compensation, directly or indirectly, from investment-banking revenues, and
19662-571: The first half of 2008 alone, Lehman stock lost 73% of its value as the credit market continued to tighten. In August 2008, Lehman reported that it intended to lay-off 6% of its work force, 1,500 people, just ahead of its third-quarter-reporting deadline in September. On August 22, shares in Lehman closed up 5% (16% for the week) on reports that the state-controlled Korea Development Bank was considering buying Lehman. Most of those gains were quickly eroded as news emerged that Korea Development Bank
19836-510: The institution became even more deeply an integral part of the South's economy. With the opening up of frontier lands after the government forced most Native Americans to move west of the Mississippi, there was a major migration of both whites and blacks to those territories. From the 1820s through the 1850s, more than one million enslaved Africans were transported to the Deep South in forced migration, two-thirds of them by slave traders and
20010-586: The institutional cash fund run by The Bank of New York Mellon and the Reserve Primary Fund, a money market fund , both falling below $ 1 per share, called " breaking the buck ", following losses on their holdings of Lehman assets. In a statement The Bank of New York Mellon said its fund had isolated the Lehman assets in a separate structure. It said the assets accounted for 1.13% of its fund. The Primary Reserve Fund owned $ 785 million or 1.2 percent of its holdings in Lehman commercial paper. The drop in
20184-567: The invention of the cotton gin , short staple cotton could be grown more widely. This led to an explosion of cotton cultivation, especially in the frontier uplands of Georgia, Alabama and other parts of the Deep South, as well as riverfront areas of the Mississippi Delta. Migrants poured into those areas in the early decades of the 19th century, when county population figures rose and fell as swells of people kept moving west. The expansion of cotton cultivation required more slave labor, and
20358-520: The labor-intensive cultivation of tobacco, the first cash crop of Virginia. Tobacco exhausted the soil quickly, requiring that farmers regularly clear new fields. They used old fields as pasture, and for crops such as corn wheat, or allowed them to grow into woodlots. The Barbados Slave Code served as the basis for the slave codes adopted in the British American colonies, including Carolina , Georgia , and Antigua . In other colonies where
20532-574: The land in return for their financial and political assistance in restoring him to the throne in 1660. The granted lands included all or part of the present-day U.S. states of North Carolina, Tennessee, South Carolina, Georgia, Alabama, Mississippi, and Florida. In the British colonies, immigration began in 1607 and continued until the outbreak of the Revolution in 1775. Settlers cleared land, built houses and outbuildings, and on their own farms. The Southern rich owned large plantations that dominated export agriculture and used slaves. Many were involved in
20706-504: The land to farm for a while. Some freedpeople left the South altogether for states such as Ohio and Indiana, and later, Kansas. Thousands of others joined the migration to new opportunities in the Mississippi and Arkansas Delta bottomlands, and Texas. With passage of the 13th Amendment to the Constitution of the United States (which outlawed slavery), the 14th Amendment (which granted full U.S. citizenship to African Americans) and
20880-455: The largest decline since the attacks of September 11, 2001 . It shook confidence in the government's ability to manage the crisis and prompted a general financial panic. Money market mutual funds , a key source of credit, saw mass withdrawal demands to avoid losses, and the interbank lending market tightened, threatening banks with imminent failure. The government and the Federal Reserve system responded with several emergency measures to contain
21054-550: The markets opened on Monday. Lehman Brothers filed for Chapter 11 bankruptcy protection on Monday, September 15, 2008. According to Bloomberg , reports filed with the U.S. Bankruptcy Court, Southern District of New York (Manhattan) on September 16 indicated that JPMorgan Chase & Co. provided Lehman Brothers with a total of $ 138 billion in "Federal Reserve-backed advances". The "Federal Reserve-backed advances" as provided by JPMorgan Chase were for $ 87 billion on September 15 and $ 51 billion on September 16. The filing remains
21228-672: The mid-to-late-1870s, some upper class Southerners created increasing resistance to the altered social structure. Paramilitary organizations such as the White League in Louisiana (1874), the Red Shirts in Mississippi (1875) and rifle clubs, all "White Line" organizations, used organized violence against Republicans , both black and white, to remove Republicans from political office, repress and bar black voting, and restore
21402-452: The next major investment bank to fall. Callan fielded Lehman's first quarter conference call, where the firm posted a profit of $ 48.9 million, compared to Citigroup 's $ 5.1 billion and Merrill Lynch 's $ 1.97 billion losses which was Lehman's 55th consecutive profitable quarter. The firm's stock price leapt 46 percent after that announcement. In 2008, Lehman faced an unprecedented loss to the continuing subprime mortgage crisis . Lehman's loss
21576-632: The number of immigrants arriving at Southern ports began to increase, although the North continued to receive the most immigrants. Huguenots were among the first settlers in Charleston, along with the largest number of Orthodox Jews outside of New York City. Numerous Irish immigrants settled in New Orleans, establishing a distinct ethnic enclave now known as the Irish Channel . Germans also went to New Orleans and its environs, resulting in
21750-816: The original Southern states was English . In the 17th century, most voluntary immigrants were of English origin and settled chiefly along the eastern coast but had pushed as far inland as the Appalachian Mountains by the 18th century. The majority of early English settlers were indentured servants , who gained freedom after working off their passage. The wealthier men, typically members of the English landed gentry , who paid their way received land grants known as headrights to encourage settlement. The Spanish and French established settlements in Florida , Texas , and Louisiana . The Spanish settled Florida in
21924-559: The others by masters who moved there. Planters in the Upper South sold slaves in excess of their needs as they shifted from tobacco to mixed agriculture. Many enslaved families were broken up, as planters preferred mostly strong males for field work. Two major political issues that festered in the first half of the 19th century caused political alignment along sectional lines, strengthened the identities of North and South as distinct regions with certain strongly opposed interests, and fed
22098-737: The panic. As of May 2022, parent company Lehman Brothers Holdings, Inc. remained in liquidation before the Bankruptcy Court for the Southern District of New York . Caretaker offices in the US and abroad have continued to oversee payments to the company's creditors. Lehman Brothers was one of the first Wall Street firms to move into the business of mortgage origination . In 1997, Lehman bought Colorado-based lender Aurora Loan Services , an Alt-A lender. In 2000, to expand their mortgage origination pipeline, Lehman purchased West Coast subprime mortgage lender BNC Mortgage LLC . Lehman quickly became
22272-487: The past eight years. Despite Fuld's defense on his high pay, Lehman Brothers executive pay was reported to have increased significantly before filing for bankruptcy. On October 17, 2008, CNBC reported that several Lehman executives, including Richard Fuld, had been subpoenaed in a case relating to securities fraud. In March 2010, the report of Anton R. Valukas , the Bankruptcy Examiner, drew attention to
22446-407: The president of the Federal Reserve Bank of New York , called a meeting on the future of Lehman, which included the possibility of an emergency liquidation of its assets. Lehman reported that it had been in talks with Bank of America and Barclays for the company's possible sale; however, both Barclays and Bank of America ultimately declined to purchase the entire company, in the former case because
22620-468: The principles of the Revolution, along with Quaker and Methodist preachers who worked to encourage slaveholders to free their slaves. Planters such as George Washington often freed slaves by their wills. In the Upper South , more than 10% of all blacks were free by 1810, a significant expansion from pre-war proportions of less than 1% free. Cotton became dominant in the lower South after 1800. After
22794-463: The proportion of their populations that were African American slaves was much higher than in the Middle Colonies and New England Colonies , as shown on the map. According to Bertram Wyatt-Brown , "Bondage was an answer to an economic need. The South was not founded to create slavery; slavery was recruited to perpetuate the South." The Barbados Slave Code of 1661 served as the basis for
22968-429: The provision of free, independent, third-party, research to the firms' clients. Lehman was one of the first Wall Street firms to move into the business of mortgage origination . In 1997, Lehman bought Colorado-based lender, Aurora Loan Services(not a bank), an Alt-A lender. In 2000, to expand their mortgage origination pipeline, Lehman purchased West Coast subprime mortgage lender BNC Mortgage LLC. Lehman quickly became
23142-639: The real estate components of the deal would be $ 1.29 billion, including $ 960 million for Lehman's New York headquarters and $ 330 million for two New Jersey data centers. Further, Barclays will not acquire Lehman's Eagle Energy unit, but will have entities known as Lehman Brothers Canada Inc, Lehman Brothers Sudamerica, Lehman Brothers Uruguay and its Private Investment Management business for high-net-worth individuals. Finally, Lehman will retain $ 20 billion of securities assets in Lehman Brothers Inc that are not being transferred to Barclays." Barclays had
23316-738: The real estate components of the deal would be $ 1.29 billion, including $ 960 million for Lehman's New York headquarters and $ 330 million for two New Jersey data centers. Lehman's original estimate valued its headquarters at $ 1.02 billion but an appraisal from CB Richard Ellis this week valued it at $ 900 million." Barclays were not to acquire Lehman's Eagle Energy unit, but to have entities known as Lehman Brothers Canada Inc, Lehman Brothers Sudamerica, Lehman Brothers Uruguay and its Private Investment Management business for high-net-worth individuals. Finally, Lehman would retain $ 20 billion of securities assets in Lehman Brothers Inc that are not being transferred to Barclays. Barclays acquired
23490-572: The rebels fought on until Lee's army surrendered in April 1865. Once the Confederate forces surrendered, the region moved into the Reconstruction Era (1865–1877), in a partially successful attempt to rebuild the destroyed region and grant civil rights to freed slaves. Southerners who were against the Confederate cause during the Civil War were known as Southern Unionists . They were also known as Union Loyalists or Lincoln's Loyalists. Within
23664-624: The region have in recent decades come to favor Republicans , although both the Republican and Democratic Party are competitive in certain Southern swing states . The region contains almost all of the Bible Belt , an area of high Protestant church attendance, especially evangelical churches such as the Southern Baptist Convention . Historically, the South relied heavily on agriculture as its main economic base and
23838-446: The region were historically dominated by a small rural elite. The historical and cultural development of the South has been profoundly influenced by the institution of slave labor , especially in the Deep South and coastal plain areas, from the early 1600s to mid-1800s. This includes the presence of a large proportion of African Americans within the population, support for the doctrine of states' rights , and legacy of racism magnified by
24012-444: The regions dominant pre-war planter class . The South suffered more than the North overall, as the Union strategy of attrition warfare meant that Lee could not replace his casualties, and the total war waged by Sherman, Sheridan and other Union armies devastated the infrastructure and caused widespread poverty and distress. The Confederacy suffered military losses of 95,000 soldiers killed in action and 165,000 who died of disease, for
24186-463: The remaining brothers continued to focus on their commodities-trading/brokerage operations. By 1858, the center of cotton trading had shifted from the South to New York City, where factors and commission houses were based. Lehman opened its first branch office at 119 Liberty Street , and 32-year-old Emanuel relocated there to run the office. In 1862, facing difficulties as a result of the Civil War ,
24360-429: The rest of the United States; however, this has declined since around the late 20th century, with many Southern areas becoming a melting pot of cultures and people. Ethnic groups in the South were the most diverse among American regions, and include strong European (especially English , Scots-Irish , Scottish , Irish , French , and Spanish ), African , and Native American ancestries. The politics and economy of
24534-545: The restructuring firm Alvarez and Marsal was appointed as chief restructuring officer and subsequently chief executive officer of the company. Later that day, the Australian Securities Exchange (ASX) suspended Lehman's Australian subsidiary as a market participant after clearing-houses terminated contracts with the firm. Lehman shares tumbled over 90% on September 15, 2008. The Dow Jones closed down just over 500 points on September 15, 2008, which
24708-403: The sale of the company, was reportedly searching for a buyer as its stock price dropped another 40 percent on September 11, 2008. Just before the collapse of Lehman Brothers, executives at Neuberger Berman sent e-mail memos suggesting, among other things, that the Lehman Brothers' top people forgo multimillion-dollar bonuses to "send a strong message to both employees and investors that management
24882-459: The same day, on investors' concerns about the security of the bank. The U.S. government did not announce any plans to assist with any possible financial crisis that emerged at Lehman. On September 10, Lehman announced a loss of $ 3.9 billion and their intent to sell off a majority stake in their investment-management business, which included Neuberger Berman . The stock slid 7% that day. On September 12, Timothy F. Geithner , then president of
25056-548: The slave codes adopted in the British American colonies of the Province of Carolina and the Province of Georgia . In other colonies where the slaves codes were not an exact copy, such as the Colony of Virginia and the Province of Maryland , the influence of the Barbados Slave Code can be traced throughout various provisions. During the American Revolutionary War , the Southern colonies helped embrace
25230-513: The south United States occurs around 9500 BC with the appearance of the earliest documented Americans, who are now referred to as Paleo-Indians . Paleoindians were hunter-gatherers that roamed in bands and frequently hunted megafauna . Several cultural stages, such as Archaic ( c. 8000 –1000 BC) and the Woodland ( c. 1000 BC – AD 1000), preceded what the Europeans found at
25404-532: The southern pine forests , the warm temperate montane forest of the Appalachians, the savannas of the southern Great Plains, and the subtropical jungle and maritime forests along the Atlantic and Gulf coasts. Unique flora include various species of magnolia, rhododendron, cane, palm, and oak, among others. Fauna of the region is also diverse, encompassing a plethora of amphibian species, reptiles such as
25578-444: The state of Kentucky attempted to remain neutral, and it could only do so briefly. When Lincoln called for troops to suppress what he referred to as "combinations too powerful to be suppressed by the ordinary" judicial or martial means, four more states decided to secede and join the Confederacy (which then moved its capital to Richmond, Virginia). Although the Confederacy had large supplies of captured munitions and many volunteers, it
25752-462: The traditional low-tariff policy of the South by imposing a new 15% tax on all imports from the Union. The Union blockade stopped most commerce from entering the South, and smugglers avoided the tax, so the Confederate tariff produced too little revenue to finance the war. Inflated currency was the solution, but that created distrust of the Richmond government. Because of low investment in railroads,
25926-408: The underlying mortgages. Whether Lehman did this because it was simply unable to sell the lower-rated bonds or made a conscious decision to hold them is unclear. In any event, huge losses accrued in lower-rated mortgage-backed securities throughout 2008. In the second fiscal quarter, Lehman reported losses of $ 2.8 billion and decided to raise $ 6 billion in additional capital by offering new shares. In
26100-457: The use of Repo 105 transactions to boost the bank's apparent financial position around the date of the year-end balance sheet . The New York attorney general Andrew Cuomo later filed charges against the bank's auditors Ernst & Young in December 2010, alleging that the firm "substantially assisted... a massive accounting fraud" by approving the accounting treatment. On April 12, 2010,
26274-505: The water at Neuberger Berman. I'm embarrassed and I apologize." Richard Fuld , head of Lehman Brothers, faced questioning from the U.S. House of Representatives ' Committee on Oversight and Government Reform . Rep. Henry Waxman (D-CA) asked: "Your company is now bankrupt, our economy is in crisis, but you get to keep $ 480 million (£276 million). I have a very basic question for you, is this fair?" Fuld said that he had in fact taken about $ 300 million (£173 million) in pay and bonuses over
26448-506: The week) on reports that the state-controlled Korea Development Bank was considering buying the bank. Most of those gains were quickly eroded as news came in that Korea Development Bank was "facing difficulties pleasing regulators and attracting partners for the deal." On September 9, Lehman's shares plunged 45% to $ 7.79, after it was reported that the state-run South Korean firm had put talks on hold. Investor confidence continued to erode as Lehman's stock lost roughly half its value and pushed
26622-421: Was "facing difficulties pleasing regulators and attracting partners for the deal." It culminated on September 9, when Lehman's shares plunged 45% to $ 7.79, after it was reported that the state-run South Korean firm had put talks on hold. Investor confidence continued to erode as Lehman's stock lost roughly half its value and pushed the S&P 500 down 3.4% on September 9. The Dow Jones lost nearly 300 points
26796-402: Was a cosmopolitan port with a variety of jobs that attracted more immigrants than other areas of the South. Because of lack of investment, however, construction of railroads to span the region lagged behind the North. People relied most heavily on river traffic for getting their crops to market and for transportation. Between 1830 and 1850, Native Americans were removed from their home states in
26970-463: Was a counterparty to mortgage financier Freddie Mac in unsecured lending transactions that matured on September 15, 2008. Freddie said it had not received principal payments of $ 1.2 billion plus accrued interest. Freddie said it had further potential exposure to Lehman of about $ 400 million related to the servicing of single-family home loans, including repurchasing obligations. Freddie also said it "does not know whether and to what extent it will sustain
27144-421: Was a result of having held on to large positions in subprime and other lower-rated mortgage tranches when securitizing the underlying mortgages; it is unclear whether Lehman was simply unable to sell the lower-rated bonds or voluntarily kept them. In any event, huge losses accrued in lower-rated mortgage-backed securities throughout 2008. In the second fiscal quarter, Lehman reported losses of $ 2.8 billion and
27318-446: Was approved. Manhattan court bankruptcy judge James Peck, after a seven-hour hearing, ruled: "I have to approve this transaction because it is the only available transaction. Lehman Brothers became a victim, in effect the only true icon to fall in a tsunami that has befallen the credit markets. This is the most momentous bankruptcy hearing I've ever sat through. It can never be deemed precedent for future cases. It's hard for me to imagine
27492-432: Was approved. After a 7-hour hearing, U.S. bankruptcy judge James Peck ruled: "I have to approve this transaction because it is the only available transaction. Lehman Brothers became a victim, in effect the only true icon to fall in a tsunami that has befallen the credit markets. This is the most momentous bankruptcy hearing I've ever sat through. It can never be deemed precedent for future cases. It's hard for me to imagine
27666-619: Was at the time the largest drop in a single day since the days following the attacks on September 11, 2001. In the United Kingdom, the investment bank went to administration with PricewaterhouseCoopers appointed as administrators. In Japan, the Japanese branch, Lehman Brothers Japan Inc., and its holding company filed for civil reorganization on September 16, 2008, in Tokyo District Court . On September 17, 2008,
27840-591: Was demoted. Bart McDade was named to succeed Gregory as president and COO, when several senior executives threatened to leave if he was not promoted. McDade took charge and brought back Michael Gelband and Alex Kirk, who had previously been pushed out of the firm by Gregory for not taking risks. Although Fuld remained CEO, he soon became isolated from McDade's team. In August 2008, Lehman reported that it intended to release 6% of its work force, 1,500 people, just ahead of its third-quarter-reporting deadline in September. On August 22, 2008, shares in Lehman closed up 5% (16% for
28014-514: Was difficult as people grappled with the effects of a new labor economy of a free market in the midst of a widespread agricultural depression. In addition, the limited infrastructure the South had was mostly destroyed by the war. At the same time, the North was rapidly industrializing. To avoid the social effects of the war, most of the Southern states initially passed black codes . During Reconstruction, these were mostly legally nullified by federal law and anti-Confederate legislatures, which existed for
28188-412: Was elected the first Republican president in 1860, seven cotton states declared their secession and formed the Confederate States of America before Lincoln was inaugurated. The United States government, both outgoing and incoming, refused to recognize the Confederacy, and when the new Confederate President Jefferson Davis ordered his troops to open fire on Fort Sumter in April 1861, war broke out. Only
28362-417: Was feared as Lehman got closer to liquidating its assets. Apartment-building investors were also expected to feel pressure to sell as Lehman unloaded its debt and equity pieces of the $ 22 billion purchase of Archstone , the third-largest United States real estate investment trust (REIT). Archstone's core business was the ownership and management of residential apartment buildings in major metropolitan areas of
28536-418: Was forced to sell off $ 6 billion in assets. In the first half of 2008 alone, Lehman stock lost 73% of its value as the credit market continued to tighten. On June 9, 2008, Lehman Brothers announced a US$ 2.8 billion second-quarter loss, its first since being spun off from American Express , as market volatility rendered many of its hedges ineffective during that time. Lehman also reported that it had raised
28710-469: Was initially finessed by political compromises designed to balance the number of "free" and "slave" states. The issue resurfaced in a more virulent form, however, around the time of the Mexican–American War , which raised the stakes by adding new territories primarily on the Southern side of the imaginary geographic divide. Congress opposed allowing slavery in these territories. Before the Civil War,
28884-543: Was invested in similar products, including derivatives. The Hong Kong government proposed a plan to buy back the investments at their current estimated value, which would allow investors to partially recover some of their loss by the end of the year. HK chief executive Donald Tsang insisted the local banks respond swiftly to the government buy-back proposal as the Monetary Authority received more than 16,000 complaints. On October 17, He Guangbe, chairman of
29058-586: Was its leverage ratio, a measure of the ratio of assets to owners equity, which increased from approximately 24:1 in 2003 to 31:1 by 2007. While generating tremendous profits during the boom, this vulnerable position meant that just a 3–4% decline in the value of its assets would entirely eliminate its book value of equity. Investment banks such as Lehman were not subject to the same regulations applied to depository banks to restrict their risk-taking. In August 2007, Lehman closed its subprime lender , BNC Mortgage, eliminating 1,200 positions in 23 locations, and took
29232-490: Was listed as the owner of seven slaves ("three males and four females ranging in age from 5 to 50") in the U.S. Census of 1860 . Capitalizing on cotton's high market value, the three brothers began to routinely accept raw cotton from slave plantations as payment for merchandise , eventually beginning a second business trading in cotton. Within a few years this business grew to become the most significant part of their operation. Following Henry's death from yellow fever in 1855,
29406-601: Was not only retained, but expanded, including the construction of a backup-trading facility. In June 2003, the company was one of ten firms which simultaneously entered into a settlement with the U.S. Securities and Exchange Commission (SEC), the Office of the New York State Attorney General and various other securities regulators, regarding undue influence over each firm's research analysts by its investment-banking divisions. Regulators alleged that
29580-448: Was operational for 158 years from its founding in 1850 until 2008. On September 15, 2008, Lehman Brothers filed for Chapter 11 bankruptcy protection following the exodus of most of its clients, drastic declines in its stock price, and the devaluation of assets by credit rating agencies . The collapse was largely due to Lehman's involvement in the subprime mortgage crisis and its exposure to less liquid assets. Lehman's bankruptcy filing
29754-470: Was predominantly rural until after World War II . Since the 1940s, the region has become more economically diversified and metropolitan , helping attract both national and international migrants. In the 21st century, it is the fastest-growing region in the United States, with Houston being the region's largest city. The South is a diverse meteorological region with numerous climatic zones, including temperate , sub-tropical , tropical , and arid —though
29928-516: Was slower than the Union in dealing with the border states. While the Upland South border states of Kentucky, Missouri, West Virginia, Maryland, and Delaware, as well as the District of Columbia , continued to permit slavery during the Civil War, they remained with the Union though Kentucky and Missouri both had rival Confederate governments that formed that were admitted and recognized by
30102-448: Was the largest in US history, beating the previous record holder Enron , and is thought to have played a major role in the unfolding of the 2007–2008 financial crisis . The market collapse also gave support to the " too big to fail " doctrine. After Lehman Brothers filed for bankruptcy, global markets immediately plummeted. The following day, major British bank Barclays announced its agreement to purchase, subject to regulatory approval,
30276-482: Was the wealthiest city in the country and the third largest in population. The success of the city was based on the growth of international trade associated with products being shipped to and from the interior of the country down the Mississippi River. New Orleans also had the largest slave market in the country, as traders brought slaves by ship and overland to sell to planters across the Deep South. The city
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