June 17, 2008

Fun with words

RAY SUAREZ: Well, Roben, you mentioned those exotic assets, hard to price. Isn't this a case where you take the hit for a couple of bad quarters, strip out those non-performing assets, write them down, and then you're a healthier, leaner country at the end of it -- company at the end of it, or is this something more dangerous than that to Lehman?

ROBEN FARZAD: It is more dangerous, because we didn't realize that the assets can't really be cordoned off that neatly. Leverage, as I've said before, has really long tentacles. It's almost like rust in a car. You know, the more you scratch away the rust, you find the rust deeper into the car.

Good enough, but what he really said was, "Leverage, as I've said before, has really long testic… um… tentacles." Check it out at 3:13.

In Farzad's defense, I think the idea of using really long testicles for leverage goes all the way back to Archimedes.

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