While it is true that politicians helped create this mess by creating the subprime market, no one forced Lehman or any other firm to leverage their companies to subprime bonds and other instruments like Collateralized Mortgage Obligations. These guys saw easy money and did not want to get left behind.
Companies that make this many bad decisions are bad companies and they should go away.
Check out this story from late 2006.
Lehman Brothers said it would pay its average member of staff $335,441 (£170,933) this year as it reported a record fourth-quarter profit of $1.0 billion, capping its most profitable year ever.
The US investment bank is paying its 25,936 staff a total of $8.7 billion in salary, bonuses and other benefits for 2006 on the back of a 23 per cent rise in net income to a record $4.0 billion.
And it was not just Lehman.
On Tuesday, Goldman Sachs announced that it would pay its 26,400 staff an average of $622,000 in compensation this year as it announced a 70 per cent rise in profits to $9.5 billion for 2006.
I'm not against investors making money. But when an invester turns into an inveterate gambler, this is always the result.
At the end of every bubble, I am reminded of the tulip bulb mania of 1636 and 1637. Bulb prices rose so fast that everyone wanted to buy in to take advantage of the easy money. Prices got so hot that the bulb economy seemed to have it's own gravity - or ability to defy it.
Every government is tempted to protect big investors from the inevitable crash, because these big investors are usually involved in government in a big way. The Dutch government could not have printed enough guilders to buy enough tulip bulbs to protect the special investors and neither should we.