Monday, September 15, 2008

Lehman Brothers: tectonic shifts under the foundations of the U.S. financial system

Three of the top five U.S. investment banks have now fallen victim to the credit crunch.

The demise of Lehman Brothers, the fire sale of Merrill Lynch - the next potential domino in the chain - and news that insurer AIG is asking the Federal Reserve for emergency funding, has sent shock waves around the world.

These really are seismic events. As one commentator put it: “Tectonic plates are shifting under the foundations of the U.S. financial system,” and we’re all likely to feel the ground shake.

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