Greed and Glory on Wall Street
The adjective “venerable” is not hyperbolic when applied to Lehman Brothers. The firm began trading commodities in Montgomery, Alabama, in 1850. After the Civil War, the three brothers, immigrants from Bavaria, moved the firm to New York City. Younger relatives joined them, the company grew, and by the end of World War I investment banking had supplanted commodity trading as Lehman’s chief focus.
Though non-family members were accepted as partners after 1924, several generations of Lehmans guided the firm until 1969. After that, the company went into a period of decline until a change of management occurred in 1973 when Pete Peterson, a former secretary of commerce in the Nixon Administration, became chief executive officer.
Peterson concentrated on making the firm efficient and created modern, full-service corporate and marketing plans. Lew Glucksman, a partner who specialized in commercial paper, worked to rebuild the company’s finances through trading, which brought in three times the income of banking.
By 1983, Peterson recognized Glucksman’s contribution by elevating him to the post of co-ceo. Within a short time, the “trader” Glucksman turned on the “banker” Peterson and forced him to leave the firm. Within a year, the House of Lehman fell apart.
This, however, is not a simple tale of good guys and bad guys. It is instead a story that tells of recent changes in the financial community. Private...
(The entire section is 304 words.)
Want to Read More?
Subscribe now to read the rest of Greed and Glory on Wall Street Critical Essays. Plus get complete access to 30,000+ study guides!