For many investors, the failure of Lehman is particularly sobering. It was a venerable 158-year-old firm that managed to survive everything from the railroad bankruptcies of the 1800s to the collapse of the Long-Term Capital Management hedge fund 10 years ago.

The question swirling in the markets is, "Who's next?" The nation's largest savings and loan, Washington Mutual, has been under pressure. But there were no announcements about that institution Monday.

Brokerages that fail usually are handled by the Securities Investor Protection Corp., which appoints a trustee to liquidate the business and protect its customers. It is unclear how Lehman's customer accounts will be handled. They could be farmed out to other firms that could protect cash and securities. That's what happened when failed junk-bond firm Drexel Burnham Lambert filed for bankruptcy in 1990.

edited by

Usman

snsint wrote:

For many investors, the failure of Lehman is particularly sobering. It was a venerable 158-year-old firm that managed to survive everything from the railroad bankruptcies of the 1800s to the collapse of the Long-Term Capital Management hedge fund 10 years ago.

The question swirling in the markets is, "Who's next?" The nation's largest savings and loan, Washington Mutual, has been under pressure. But there were no announcements about that institution Monday.

Brokerages that fail usually are handled by the Securities Investor Protection Corp., which appoints a trustee to liquidate the business and protect its customers. It is unclear how Lehman's customer accounts will be handled. They could be farmed out to other firms that could protect cash and securities. That's what happened when failed junk-bond firm Drexel Burnham Lambert filed for bankruptcy in 1990.

edited by

Usman