Creditflux Newsletter

It is not unusual to find colourful language in US litigation proceedings as lawyers seek to demonise the defendents, but a recent pleading in a case involving Lehman Brothers’ synthetic CDOs is a gem. It points out that Lehman “either in a fit of black comedy or truthful confession” called one of its transactions Dante.

“As the plaintiffs have quickly discovered,” write the authors of the complaint, “investing their life savings into complex derivative investments … has truly been a descent into financial hell.”

What the class action suit fails to point out that in the Divine Comedy, Dante re-emerged from hell and ended his journey in paradise. Sadly, investors seem unlikely to share his fortune – at least in financial terms.