Disruptions in financial markets come from surprises — unanticipated events markets cannot discount; the Lehman problem was that after the Bear Stearns intervention markets expected Lehman to be bailed out too, so the non-bailout was a surprise, whereas a clear strategy articulated right after Bear Stearns would have substantially reduced the impact.
causalpending
Speaker
John TaylorEvidence Quote
“what I observe in disruption and financial markets are surprises where you can't discount an event... the problem with Lehman was it was a surprise after the bear intervention... there was a great expectation that Lehman Brothers would be intervened and bailed out and when it wasn't that was a surprise people weren't ready”
Created: 6/15/2026, 9:20:12 AM
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