Lehman Declares Bankruptcy

Lehman, minus some of its healthy units (its asset management group, for example) has filed for bankruptcy.  Paulsen refused to put federal money into a workout deal and potential buyers walked out.  Bear Stearns investors should view themselves very lucky. Why Bear and not Lehman?  Who knows.  Buyers will appear but it will be for Lehman assets in liquidation rather than for the company itself.  Bankruptcy is an inevitable part of our economic system, like forest fires in forests,  -- they cannot be managed out for long and when we try we make their effects worse.