Business Case Studies & Business Publications

The Weekend that Changed Wall Street

Allayannis, George...

Case

The Weekend that Changed Wall Street

Allayannis, George (Yiorgos); Brandriff, Christopher

F-1587 | Published July 14, 2009 Case

Collection: Darden School of Business

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This case examines the causes and consequences of the Lehman Brothers bankruptcy during one of the most fascinating weekends in financial history. It's about the commercial paper market, a major funding market served by Lehman Brothers, and the events that led to "breaking the buck" on money market funds. It also examines the CDS market where Lehman was such a big player, the potential impact that CDSs had on the crisis, and the notion and validity of the too-big-to-fail hypothesis.

• Discuss the causes and consequences of the Lehman Brothers bankruptcy • Examine the commercial paper market, a major funding market served by Lehman Brothers, and the events that led to “breaking the buck” on the money market funds • Examine the CDS market and the potential impact that CDSs had on the crisis • Explore the moral hazard issues surrounding the banking sector and the notion of too big to fail