If the government intervened, the systemic risk after Lehman Brothers' bankruptcy could have been avoided. Before the collapse of Lehman Brothers, federal officials partially resolved a series of financial turmoil by keeping troubled institutions such as Fannie Mae, Freddie Mac and Bear Stearns alive.
Officials thought these institutions were too big to fail, so they used billions of dollars of taxpayers' money to help them. But not for Lehman Brothers.
Prevention methods:
China news agency, Beijing, September 18 Issue: Experts: Prevent "Lehman Virus" from "infecting" China through two major channels.
Lehman Brothers, the fourth largest investment bank in the United States, filed for bankruptcy protection, becoming the largest bankruptcy case in the country's history so far; Coupled with the lightning change of ownership of Merrill Lynch, American International Group (AIG) fell into financing difficulties, and the US subprime mortgage crisis entered a stage of deep development, triggering a global "financial tsunami". Naturally, China is not immune.
The psychological influence is mainly reflected in the capital market. Mei Xinyu said that the United States is China's second largest trading partner, one of the main sources of investment and the largest financial market in the world. This crisis will inevitably create a pessimistic atmosphere among the participants in China's capital market.