Lehman Brothers: The Rise and Fall of An American Dynasty

The Lehman Trilogy follows three Jewish brothers and the rise and demise of their Lehman Brothers financial conglomerate over 167 years.

Let’s explore the Lehman Brothers’ timeline, which spans almost two centuries, from their humble beginnings to their success and fall.


Mayer and Emmanuel Lehman. Courtesy of the Rare Book and Manuscript Library at Columbia University.

Henry Lehman arrives in America as a German emigrant. He opens a dry goods general store in Montgomery, Alabama. His brothers, Emmanual and Mayer, arrive, and they rename the business to Lehman Brothers. Capitalizing on the South’s most important crop, the brothers accept cotton as payment for merchandise and build their business on cotton trading. Henry dies in 1855. Soon thereafter, the two remaining brothers open a New York City branch in 1858 and build it into an important investment bank.


The Civil War wreaks havoc on the Southern economy and cotton trade. However, the remaining Lehman brothers prevail. They launch the New York Cotton Exchange, the oldest commodities exchange in New York. They diversify into railroad, land, industrial, mining and oil businesses.


New York Stock Exchange, 1929

Lehman Brothers gain entry in the New York Stock Exchange and dabble in investment banking. Philip Lehman takes over the company from 1901 to 1925 and joins force with Goldman Sachs to increase profits and underwrite equity issues for F.W. Woolworth, Studebaker, and Macy’s


Robert Lehman becomes the new leader of Lehman Brothers and retains that position from 1925 to 1969. He steered the company to success despite the stock market crash and resulting Great Depression, World War II, Vietnam War and Cold War. In fact, following World War II the firm began to make its mark on Wall Street. Under Robert’s leadership Lehman Brothers emerged as a major player in the financial world, pioneering innovative financial products and expanding its global reach. During the course of his leadership:

  • The Lehman Corporation, a closed-end investment company, is born in 1929. 
  • Congress passes the Glass-Steagall Act in 1933 to split up commercial and investment banking. 
  • The post-WWII economic boom adds value to investment banking market. 
  • Lehman Brothers launch One William Street Fund, a diversified holdings mutual fund, in 1958.
  • In 1969, Robert Lehman, the last family member to lead Lehman Brothers, dies. 


Frederick Ehrman, investment banker and former governor of New York Stock Exchange, leads Lehman Brothers. Ehrman dies of a heart attack in his sleep in December 1973.

Peter Peterson


Peter Peterson is CEO of Lehman Brothers.


Lew Glucksman becomes CEO of Lehman Brothers.


American Express’ Shearson Division acquires Lehman Brothers. 


The stock market collapsed, losing 22.6% of its value and became the biggest one-day percentage loss in history. And still Lehman Brothers survives.


Lehman Brothers Headquarters in New York City. Photo by AP Photo/David Karp

Lehman Brothers reaches its golden years as one of the “Big Five” investment banks on Wall Street. The firm continued to remain resilient despite economic downturns financing major projects and companies, from the construction of iconic skyscrapers to the funding of groundbreaking technological innovations. 

  • Richard Fuld becomes CEO after Lehman Brothers disbands from American Express. The company becomes Lehman Brothers Holdings Inc. in 1994.
  • The Financial Services Modernization Act repeals the 1933 Glass-Steagall Act.
  • 9/11 terrorist attacks affect global markets in 2001.
  • Lehman relocates from Wall Street to midtown Manhattan in 2002.
  • Lehman Brothers acquires five mortgage lenders for heavy mortgage-backed securities investments. 

Yet, catastrophe was just around the corner.  

  • The financial crisis begins in 2007 when home prices declined by as much as 15%, eliminating homeowners’ equity and leaving them with no incentive to pay their mortgage. Additionally, two Bear Stearns hedge funds, which had invested an unknown amount in mortgage-backed securities, are sold causing the stock market to fall 2%, the second-largest drop in two years. 
  • In November 2007, the US Treasury convinces Citigroup, JPMorgan Chase, and Bank of America to create a federally backed $75 billion superfund to buy distressed portfolios of defunct subprime mortgages. But efforts to shore the flailing industry were not enough. By January, foreclosure rates had doubled. Home sales fell 2.2% while home prices fell 6%. 
  • As the housing market bubble burst and toxic mortgage-backed securities soured, Lehman Brothers found itself dangerously overleveraged and exposed to billions of dollars in risky assets. Despite frantic efforts to secure a lifeline from other financial institutions and the U.S. government, Lehman Brothers was ultimately unable to stave off collapse.
  • On September 15, 2008, Lehman Brothers files for bankruptcy. Barclays buys their U.S. corporation, and Nomura acquires the Asian and European operations.
  • The Great Recession starts in December 2007 and ends in June 2009.

At its height, Lehman Brothers held some $600 billion in assets and was the fourth-largest investment firm in the U.S. Although Lehman Brothers ended in tragedy, it started with three brothers and a dream that blossomed into a multi-faceted enterprise.

The Lehman Trilogy
May 3-June 2, 2024 • Kilstrom Theatre