For more than 150 years, the Lehman Brothers played an important part in the financial and commercial history of the United States. Lehman Brothers Holdings Inc. (LEH) was one of the earliest investment banking firms that stimulated the U.S. economy. The firm offers an inside look at the emergence and growth of American industry and technology as well as influenced the establishment of the modern corporations today. Eventually, The Lehman Brothers’ “forward thinking” and risk taking led to and ugly turn, bringing demise to businesses, investment institutions, and their own firm; affecting the economy and handing the bill to tax payers.
Lehman Brothers’ Rise
In 1844, Henry Lehman immigrated from Germany to Montgomery, Alabama where he started a small store selling groceries and clothing to the local cotton farmers. By 1850, Emanuel and Mayer also immigrated and joined him in the business, and they named it “Lehman Brothers”. The store began accepted raw cotton as payment which led to the beginning of trading cotton. Henry Lehman died in 1855 from yellow fever and the two younger brothers headed the firm for the next four decades and focused on commodities trading and financial investments that included sales and trading of securities. 
Continuing in the 1850’s, the cotton trading industry dominated the economy in the south, enabling Lehman Brothers to engage in larger sales and trades. As business grew, offices grew, which led the brothers to open a New York office. The firm grew stronger and soon controlled commodities trading in businesses and had a good grip on the financial community. In the 1867, Lehman Brothers was assigned to be the Alabama government's fiscal agent to help sell the state's bonds. The firm was also assigned to service the state's debts, interest payments, and other obligations. In the 1880’s, they helped establish the New York Cotton Exchange (NYCE), Coffee, and the Petroleum Exchange. The rapid development of railroads led to sales of railroad bonds to raise the funds needed to build them. Bonds were at affordable prices and they were sold to investors, bringing young eager investors into the market. As they observed the market, Lehman Brothers expanded its commodities business to expand their portfolio and include the sales and trading of securities. Their success brought them to the New York Stock Exchange and transforming them into merchant banking firm, in 1887, providing long term loans to companies, financial advisory, and eventually underwriting. 
Throughout the 1900’s, Lehman Brothers had many ventures that propelled them to the top of the investment world. As Lehman Brothers’ success continued and other financial institutions followed, Philip Lehman and Goldman, from Goldman-Sachs, joined forces to underwrite securities issues to several prominent retail stores such Sears, Roebuck & Co., F.W. Woolworth Co., May Department Stores, Gimbel Brothers, Inc. and R.H. Macy & Co; which today some have merged and others have ceased to exist.  In the 1920’s, Lehman Brothers then got involved with airlines and was an early supporter of the entertainment businesses such Orpheum theaters, Radio-Keith-Orpheum (RKO), Paramount Pictures, and 20th Century Fox. As the Great Depression hit, they developed a new method of financing that created loans between blue-chip borrowers and private lenders that included strict rules for a lender’s safety, letting borrowers raise needed capital and lenders to receive an appropriate return with an acceptable level of risk. The firm also dabbled in the expansion of the oil industry. In the 1960’s, the firm greatly expanded the market’s trading capabilities in commercial paper which then led them to become the dealer for U.S. Treasuries. In the 1970s, Lehman Brothers became global and opened offices in Europe and Asia. The firm enhanced in 1977 through the merger with the prominent investment bank, Kuhn, Loeb…