Uncontrolled Risk: Lessons of Lehman Brothers and How Systemic Risk Can Still Bring Down the World Financial System

Why was Lehman ignored when everyone else was bailed out? This title explains how uncontrolled risk toppled a 158-year-old institution, using this story as a microcosm to illuminate the interconnection of the global financial system, as well as broader policy implications.

Autorentext

Mark T. Williams is a risk management practitioner and academic with two decades of experience. He has worked as a senior executive for major energy trading companies, a trust banker, and an examiner for the Federal Reserve Bank. Williams is currently on the fi nance and economics faculty at Boston University and serves as a senior advisor at the Brattle Group. He has been a guest columnist for Reuters.com, Forbes.com, and the Boston Globe.

Klappentext

How Excessive Risk Destroyed Lehman and Nearly Brought Down the Financial Industry

"Uncontrolled Risk will ruffle feathers-and for good reason-as voters and legislators learn thediffi cult lessons of Lehman's collapse and demand that we never forget them."
Dr. David C. Shimko, Board of Trustees, Global Association of Risk Professionals

"Uncontrolled Risk is a drama as gripping as any work of fiction. Williams's recommendations forchanges in the governance of financial institutions should be of interest to anyone concernedabout the welfare of global financial markets."
Geoffrey Miller, Stuyvesant Comfort Professor of Law and Director, Center for the Study ofCentral Banks and Financial Institutions, New York University

"The complex balance of free enterprise on Wall Street and the healthyregulation of its participants is the central economic issue of today.Williams's forensic study of Lehman's collapse may be the bestperspective so far on the issues that now face regulators."
Jeffrey P. Davis, CFA, Chief Investment Officer,Lee Munder Capital Group

"Provides a very perceptive analysis of the fl aws inherent in risk management systems and modernfi nancial markets. Mandatory reading for risk managers and financial industry executives."
Vincent Kaminski, Professor in the Practice of Management,Jesse H. Jones Graduate School of Business, Rice University

"Gives the reader much food for thought on the regulation of our financial system and its interplaywith corporate governance reform in the United States and around the world."
Professor Charles M. Elson, Edgar S. Woolard Jr. Chair in Corporate Governance,University of Delaware

The risk taking behind Wall Street's largest bankruptcy . . .

In this dramatic and compelling account ofLehman Brothers' spectacular rise and fall,author Mark T. Williams explains how uncontrolledrisk toppled a 158-year-old institution-and whatit says about Wall Street, Washington, D.C., and theworld financial system. A former trading floor executiveand Fed bank examiner, Williams sees Lehman's2008 collapse as a microcosm of the industry-aworst-case scenario of smart decisions, stupid mistakes,ignored warnings, and important lessons inmoney, power, and policy that affect us all.This book reveals:

• The Congressional inquisition of disgracedCEO Dick Fuld: Did he really deserve it?
• How the investment-banking money machinebroke down: Can it be fixed?
• The key drivers that caused the financialmeltdown: Can lessons be learnedfrom them?
• The wild risk taking denounced by PresidentObama: Is Washington to blame, too?
• The ongoing debate on reform andregulation: *Can meaningful reform avertanother financial catastrophe?*This fascinating account traces Lehman's historyfrom its humble beginnings in 1850 to its collapsein 2008. Lehman's story exemplifies the everchangingtrends in finance-from investmentvehicles to federal policies-and exposes thedanger and infectious nature of uncontrolled risk.

Drawing upon first-person interviews with riskmanagement experts and former Lehman employees,Williams provides more than just a frontlinereport: it's a call to action for Wall Street bankers,Washington policymakers, and U.S. citizens-a livinglesson in risk management on which to build astronger fi nancial future. Williams provides a tenpointplan to implement today-so another Lehmandoesn't collapse tomorrow.

Includes aten-point plan toensure a strongfinancial future forboth Wall Street andMain Street

Zusammenfassung
A COMPELLING CASE STUDY OF THE FALL OF LEHMAN BROTHERS--ILLUSTRATING THE DANGER OF UNCONTROLLED RISK

Inhalt

1. The Inquisition
   
   2. Lehman: From Humble Roots to Wall Street Contender
   3. From Private to Public
   4. History of Investment Banking
   5. How the Investment Banking Money Machine Works
   6. The Roller-Coaster 1980s
   7. The 1990s: Rebuilding Years
   8. Lehman's Near Death Experience
   9. Innovation, Imitation and Increased Risk: Mortgage-Backed Securities
   10. Lehman's Risk Management
   11. The Real Estate Bet and the Race to the Bottom
   12. The Bear Mauling
   13. Time Runs Out
   14. The Death of Lehman, Regulation, and Investment Banking
   15. The Eneablers and the Deciders
       Epilogue: The Post-Lehman Financial Landscape
       Appendix: Lehman Brothers Chronology of Key Events