Two Years after Lehman

We could talk about things from a narrow perspective, if only the sums at play were not so huge. Since the collapse of Lehman Brothers two years ago, its dismantling will have cost at least $2 billion, not counting the legal and accounting expenses. This bill, put forward by the Financial Times, speaks volumes about the extraordinary complexity of operations in which the American firm was involved, about the difficult traceability of its financial products that it dealt with, and even about the knowledge of the risks it was taking. If it takes so much time and so many people to unravel the Lehman Brothers plot, isn’t it because the company itself had become uncontrollable?

But without a doubt, two years after the fall of the cursed Wall Street firm, it would be naive to believe that this issue no longer exists anywhere. Are we certain that internal control procedures have been sufficiently tightened everywhere? Are we certain that surveillance of financial institutions, which was so lacking in 2008, is really much better now than in the past? Are we certain that there is not a new AIG growing under the watchful eye of the regulators? Do we really believe that the financial system will involve fewer risks when the big Wall Street banks have yielded their trading to others to appear clean? Let us not be mistaken. In two years, in the United States and in Europe, important advances have taken place to better regulate and monitor the financial sector. And nothing would have been possible without restoring individuals’ confidence in financial institutions and restoring confidence between the institutions themselves. Without this condition, which should be credited to the States and the central banks, the whole system could have collapsed.

But, during the last two years, the second global currency, the euro, almost crumbled, the liquidity of the banking system remained extremely fragile, the States came close to defaulting, new bubbles appeared in the raw materials and bond markets…

Two years after Lehman, the tectonic plates of the financial system have not stabilized. The world is not protected from another major earthquake.