Lehman Brothers


DEFINITION of 'Lehman Brothers'

A firm that was once considered one of the major players in the global banking and financial services industries, but declared bankruptcy on September 15, 2008, after a catastrophic collapse caused by a mix of subprime mortgage exposure as well as negative rumors and alleged short selling in the market. The fall of Lehman Brothers marked the beginning of the public's awareness of the forthcoming credit crisis and recession of the late 2000s.

BREAKING DOWN 'Lehman Brothers'

The bankruptcy of Lehman Brothers was, at the time, the largest bankruptcy filing in U.S. history. Although the stock market was in modest decline prior to these events, the Lehman bankruptcy, coupled with the earlier collapse of Bear Stearns, greatly eroded confidence and led to a precipitous declines across the major U.S. indexes in late September and early October 2008.

  1. Subprime Meltdown

    The sharp increase in high-risk mortgages that went into default ...
  2. Short Selling

    Short selling is the sale of a security that is not owned by ...
  3. Death Knell Stocks

    The shares of a publicly traded company that is on the verge ...
  4. Bear Stearns

    An investment bank located in New York City that collapsed during ...
  5. Lehman Aggregate Bond Index

    An index used by bond funds as a benchmark to measure their relative ...
  6. Lehman Brothers Government/Corporate ...

    An unmanaged market-weighted index, comprised of government and ...
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