How do you think former Lehman Brothers executives felt about the recently released report on the firm’s failure that reveals, among other things, the firm used a weird accounting practice known as “Repo 105″ to move $50 billion of toxic mortgage assets off its books in order to make its balance sheet look healthier? Embarrassed? Regretful? Are they thinking to themselves Wow, in retrospect, that does look pretty bad. What were we thinking? Not really, no. This morning’s Post reports that former CEO Richard Fuld feels “vindicated” by the report, since Repo 105 is not illegal, but merely kind of skeazy. Others apparently feel the same way: “I’m like, whatever,” a former managing director of Lehman London tells the Observer. “When I read this, I giggle a little bit, because $50 billion is a drop in the ocean.”
The “yappers” who are shocked by it, he said, are merely unsophisticated “nonprofessionals” who are just looking for someone to point the finger at for the near-collapse of the financial system. But as amusing as it is, it’s also kind of sad, really, said another executive, that people are just so stupid.