Should Lehman Brothers have been saved?

Whether or not Lehman Brothers should have been saved will be debated for years. The government took action to broker a deal that essentially kept Bear Stearns out of bankruptcy court. And it later pledged billions to keep Citi and AIG afloat, not to mention Fannie and Freddie. So why did the government let Lehman Bros. fail? No one really believes that Bear Stearns was more intrinsic to the global credit markets.

TheDeal.com weighs in with an insightful article that suggests the government had to let a bank fail, for philosophical reasons as much as any. Lehman had made itself any easy target, and its efforts toward the end failed to impress. Paulson reportedly pressured Fuld to sell, but Fuld resisted. Paulson has since said Fuld had favored some sort of deal to save Lehman, but he lacked the funds. In the end, we would likely have had a credit crunch no matter what. Still, the debate rages.

For more:
- here's the article from TheDeal.com

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