Reddit reviews The Fed and Lehman Brothers: Setting the Record Straight on a Financial Disaster (Studies in Macroeconomic History)

Some lesser known titles:

• The Fed and Lehman Brothers: Setting the Record Straight on a Financial Disaster, by Laurence M. Ball [Discusses why Lehman was singled out to fail]
  
• Borrowed Time: Two Centuries of Booms, Busts, and Bailouts at Citi, by James Freeman [Tell-all about the bank and how the institution relied on well-placed friends in the US government and its role in the 2008 recession]
  
• The Bank That Lived a Little: Barclays in the Age of the Very Free Market, by Philip Augar [The rise of Barclays and how it almost rescued Lehman]
  
• Damaged Goods: The Inside Story of Sir Philip Green, the Collapse of BHS and the Death of the High Street, by Oliver Shah [Goes over the plummet British Home Stores' pension funds in 2009]
  
• Crashed: How a Decade of Financial Crises Changed the World, by Adam Tooze [Starts with Lehman's failure and connects the dots to the current economy, including Putin, Brexit, and Trump]

Again, the assets did have value -- markets just weren't operating.

It's like having a G6 private jet during the world's worst economic crisis in decades. It obviously has value, but there might not be a bid for it at any level if banks are collapsing and GDP is declining rapidly. If you're running low on cash and look to repo your G6 or sell it to raise cash to continue operating you would find yourself SOL. Again, it doesn't mean the jet is worthless nor that you are insolvent from a balance sheet perspective. It just means capital markets, credit markets, and markets in general are not open or operating.

Without access to liquidity, no one can survive in perpetuity. The Fed stepped in to provide this critical needed liquidity - partly because that's its job as lender as last resort, partly because it wanted to provide stability, and partly because it could afford to absorb these assets in the event they proved to be worthless / toxic. In reality they ended up being quite valuable and the Fed has generated mountains of profits off its various asset purchase / lending programs since the GFC.

This book explains it all in great detail, talks exclusively about the liquidity vs solvency status of Lehman, and also outlines the various Fed programs made available to institutions during the GFC. Would highly recommend it: https://www.amazon.com/Fed-Lehman-Brothers-Financial-Macroeconomic/dp/1108420966