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Lehman Brothers – The Chronicle of a Family Business

If you haven’t seen The Lehman Trilogy, go and see it - and if you're not a thespian, don’t worry; the Piccadilly Theatre will sell you a nice big glass of wine to gulp in your seat.

The Lehman Trilogy

You'd be wrong if you expect this wonderful play to be about the financial crash of 2008 and our sainted Prime Minister, Gordon Brown, 'saving the world'. I am sorry but there are no scenes depicting humiliated merchant bankers exiting buildings with cardboard boxes like latter day Caratacuses. Instead, this is the humbling story of three orthodox Jewish brothers from Rimpar in Bavaria, who took the boat to America.  The pioneering older brother, Henry, arrives there first to the unlikely destination of Montgomery, Alabama in 1844, at the heart of the cotton belt. After he sets up shop and sees the lay of the land, the others follow.

The play's called 'The Lehman Trilogy' but in fact there are three trilogies to the story – Trilogy 1) three founding brothers, Henry, Emmanuel and Mayer. Trilogy 2) three generations of the Lehman dynasty. Trilogy 3) three big financial crashes in the life of the firm. (Before the biggie that destroyed it).

The three financial crashes are, the panic of 1857 (apparently caused by over-expansion of the U.S. economy), a stock market collapse of 1873, and The Wall Street crash of 1929. The difference about the one we remember in 2008 that killed off the firm, was that it took place 39 years after the last Lehman was in charge.

The story is one of empire - albeit a financial one - which describes in graph-like terms the green shoots of early growth, the flowering summer, followed by the withering and dead-heading. For those of us in business, it is a parable of the loss of collective memory.

While watching I was reminded of Arnold Weinstock who built up GEC, the UKs leading electronics firm which he led for thirty-three years between 1963 and 1996. A difficult man to work with, his attention to cost was ferocious. For this he was taunted by the City for not spending a cash mountain he built up which at one time amounted to $5bln. For the stock market disdains nothing more than a cash-rich company. It does not see cash, as family firms do, as insurance. After his son and planned successor Simon died, Weinstock was ousted. George Simpson of Lucas Industries took over and five years later the money was spent and the company was gone.

The focus of The Lehman Trilogy is prequel rather than post mortem; an examination of what made Lehman great for 125 years and, by implication, what happens when those who run a company no longer have a personal stake in the business.

Three great actors, led by the recently knighted Simon Russell Beale (if you don’t know him, think Beria in The Death of Stalin (2017)) conjure up the brothers and those who interact with them. Like your best ever dinner guest, Russell Beale moves from orthodox Jew to southern belle and back to cotton baron in the course of a few minutes.

The programme notes draw attention to the trust required between family members in Jewish businesses and the circumstances that drove generations of Jews into professions that host nations deemed below their status. Prime metals and scrap, I am pleased to say, are two of them. What is slightly unusual is that the three brothers turn up in the same country. The Golodetz family in my industry, who I came to know in Surrey but were originally from Russia, split their risk. Of the three brothers, one was sent to America, one remained in Russia, while the other was sent to England. If they survived, they had an international business. When I started in metals in the late 1970s the Golodetzes were ubiquitous in steel, ring dealing members of the LME, and sugar traders on the floor of the softs markets. Today the name is almost forgotten.

This play inches towards rescuing the Lehman name from its indelible association with the crash. Those at the helm after its sale to American Express in 1984, were not Lehmans. They were no more Phillipp Brothers than Phibro, or Lazarus than Lazmet.

All the affairs of man, business included, have a biblical cycle to them, to which Lehman was as condemned as any. There is a financial time to live, and a financial time to die. The distinctive fact about Lehman’s success, which appears to require re-learning, is how the success of most corporations comes from imagination, hard work, trust and luck – but above all providing a service of some kind; and having a view to the horizon rather than stock market targets and monthly reporting.

It was lucky, for example, that, days before the Wall Street Crash, Lehman had taken in money that had not yet been deposited into a fund. But it was not luck that the owners did not choose either to stick revolvers in their mouths or step off a window-ledge. Financial crashes are not a happenstance to a family business - they are a certainty. It is something to be planned for on every sunny day, and after every good trade. In a family business, you build up net worth not to spend but to have sufficient financial fat to survive the inevitable famine and disaster. What emerges from this story is how the partners through three generations took decisions that 'they' stood to lose from. That is very different to betting the bank with 'other people’s money'; and on complex financial instruments that have no societal purpose. It would not be a bad lesson for our degraded financial system to learn – a City that routinely awards bonuses in the knowledge that when bad times come round the corner (see Noel Coward) the recipients will be sunning themselves in the Bahamas. Family businesses – and they don’t have to be Jewish – don’t think like that.

Watching the play, the vision came into my mind of the young French trader, Edouard d’Archimboud, whose start date at Lehman was the rather inauspicious date of 11th September 2008, the day of the crash. As he entered the building in London for the first time, he was handed a cardboard box to put his things in.

Looking back on it, that might possibly have been the most fortuitous day of his life - and I cannot help wondering what became of him.

Perhaps he founded a family business? I certainly hope so.

Published June 12th 2019 on


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