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Lehman, Halliburton, Carlyle Grp, and George Walker, and George Bush

29 April, 2009

Weeks ago I started to track down some of the AIG payments to foreign banks.  I have done, but each bank history leads me to another bank or another name and I have come up against the difficulty of reporting all I have learned in a way that would make it readable.  I will continue to try.  In the meantime, I want to call your attention to this snippet from the Wikipedia article on Lehman Bros.

Investor confidence continued to erode as Lehman’s stock lost roughly half its value and pushed the S&P 500 down 3.4% on September 9.

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The U.S. government did not announce any plans to assist with any possible financial crisis that emerged at Lehman.

The next day, Lehman announced a loss of $3.9 billion and their intent to sell off a majority stake in their investment-management business, which includes Neuberger Berman. The stock slid seven percent that day.Lehman, after earlier rejecting questions on the sale of the company, was reportedly searching for a buyer as its stock price dropped another 40 percent on September 11, 2008.

Just before the collapse of Lehman Brothers, executives at Neuberger Berman sent e-mail memos suggesting, among other things, that the Lehman Brothers’ top people forgo multi-million dollar bonuses to “send a strong message to both employees and investors that management is not shirking accountability for recent performance.”

Lehman Brothers Investment Management Director George Herbert Walker IV dismissed the proposal, going so far as to actually apologize to other members of the Lehman Brothers executive committee for the idea of bonus reduction having been suggested. He wrote, “Sorry team. I am not sure what’s in the water at Neuberger Berman. I’m embarrassed and I apologize.”   (here)

The apologetic Investment Management Director at Lehman’s is George W. Bush’s second cousin and obviously the first cousin of the man who bears a similar name George Herbert Walker Bush, a former president of the United States.  Why he would be expected  to give up his multi-million dollar bonus for managing the company into the ground in order to save those people who worked for or invested in Lehman Bros. is beyond me.   No one in the upper echelons of our society really has to take responsibility for anything they do, especially when they are so well-connected.

But, look at this.  After denigrating those embarrassing people at Neuberger, George Walker became their CEO.  Here’s how it was done, according to The New York Times, which goes out of its way to not call attention to Walker’s relation to G. W. Bush who at this time is still president of the U.S.

A group of managers and senior employees of Lehman Brothers’ Neuberger Berman unit was selected as the winning bidder for the bankrupt investment bank’s money management business on Wednesday, after an auction was held in federal bankruptcy court in Lower Manhattan.

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“The notion that Neuberger will again be an independent, stand-alone asset management company is terrific,” said George Walker, the Lehman executive who will become the new company’s chief executive.

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Shortly after Lehman filed for bankruptcy in September, Bain and Hellman were selected as buyers for the unit. They would have created a stand-alone company. But the Carlyle Group, which had bid for Neuberger, and a former Neuberger chief executive persuaded the bankruptcy judge to reopen the bidding, arguing that Bain and Hellman were paying too low a price. Carlyle dropped out of the bidding before the final deadline on Tuesday. (here)

Why did the Carlyle Group walk away after bidding for the Neuberger group?  Do you think it might have something to do with the fact that George H. W. Bush is a Carlyle Senior Advisor?

The Carlyle Group is one of the world’s largest and most secretive investment funds. Nicknamed the Ex-President’s Club, Carlyle’s employees have included both President Bush, H.W. and George W. Bush, former British Prime Minister John Major, former Secretary of State James Baker, and former Defense Secretary Frank Carlucci. Amidst growing public scrutiny over its dealings, the company has recently scaled back its holdings in military contractors and its links to controversial political figures.  (here)

Or perhaps it was the long family ties to Halliburton?

In the 1930s, helped finance the rapidly growing oil industry, including the companies Halliburton and Kerr-McGee. (here)

No wonder the management needed to hold on to those multi-million dollar bailouts.  Look what they had to buy.

Neuberger Berman is a marketing name which is used to refer to the select group of entities and product lines that will be part of a new entity to be named Neuberger Berman Group, LLC. This entity will be created in connection with the closing of the pending acquisition by management of the majority interest in Neuberger Berman and select fixed income and alternative asset management businesses of Lehman Brothers Holdings Inc.’s Investment Management Division.

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The select asset management businesses that will be part of the acquisition include those of various existing investment advisers, including Neuberger Berman, LLC, Neuberger Berman Management LLC, Lehman Brothers Asset Management LLC, Lehman Brothers Asset Management Inc., Lehman Brothers Alternative Investment Management LLC, Lehman Brothers Private Equity Advisers LLC, Lehman Brothers Private Fund Advisers, LP, Lehman Brothers Private Fund Management, LP and select other affiliated investment advisers.      (here footnote)

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