Muffie Benson-Perella, moonlighting today as ghostwriter for Fortune Editor at Large Patricia Sellers, wonders in her "Postcards From the Pinnacles of Power" column why Lehman wasn't saved, given its extensive "presidential connections."
Dick Paulson, Hank Paulson's brother, great-grandson of Theodore Roosevelt, and great-great-grandson of Theodore Rosevelt, President Bush's second cousin, and Jeb Bush were all wonderfully nepotistic opportunities to keep conspiracy theorists buying Reynolds Wrap to wrap around their heads for years. (Flash trade idea: Short the Rank Group, Ltd., and go long tin futures before spreading the word that Reynold's Wrap is actually Aluminum foil). So why didn't Lehman get saved?
Wasn't it a mistake to let Lehman Brothers fail? Treasury Secretary Hank Paulson was asked this very question in a Q&A that ran in yesterday's Wall Street Journal, and he replied, "We didn't have an option." He said that Lehman had neither a buyer, as Bear Stearns did in JPMorgan Chase (JPM), nor adequate assets to justify a life-saving federal loan.
Lehman Brothers' presidential connections [Fortune CNN etc.]