Crises are nearly always unexpected. When Russia defaulted in 1998, it caused a crisis because the markets didn't see it coming. But Argentina's much larger default in 2001, or Venezuela's in 2018, caused barely a broader ripple because they were so clearly signposted and expected.

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Data: FactSet; Chart: Axios Visuals

The chart of the last five years of the Lehman Brothers' share price shows a company going to zero in pretty much the most orderly way you could imagine. It doesn't suddenly plunge at the end; rather, the decline begins in mid-January 2007, a full 20 months before catastrophe strikes. This chart is a chronicle of a bankruptcy foretold.

Between the lines: If the crisis really began on Sept. 15, 2008, it's not because Lehman fell — it's because the Fed wasn't there to catch its fall. When shareholders lose money, that almost never has systemic consequences.

  • But Lehman was an integral part of the plumbing of the financial system and had tens of thousands of counterparties around the world. Those counterparties woke up in a world where they had no idea whether they owned their assets anymore. And that is the kind of thing that causes a crisis.

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