What did the Lehman brothers do wrong?

Answer 1

Lehman Brothers engaged in excessive risk-taking by heavily investing in mortgage-backed securities and subprime loans, underestimating the potential for a housing market collapse. They employed high leverage ratios, which amplified their losses when the financial crisis hit. Additionally, their lack of transparency and reliance on complex financial instruments contributed to a loss of investor confidence, ultimately leading to their bankruptcy in 2008. This event marked a pivotal moment in the global financial crisis.