Daily Options Report

So hard to believe, but LEH was full of it, and it wasn't actually a cabal of shorts that brought them down. And Barry Ritholtz wants an apology.

In the early days pre-meltdown, there were a handful of skeptics pointing to problems at firms like AIG, Fannie Mae, Bear Stearns and most especially Lehman Brothers.

It was not the media or the analyst community that identified the frauds, but the short sellers. In this sad tale of criminality and corruption, the shorts were the heroes. They employed an army of traders, forensic accountants, and non-cheer-leading analysts to kick the tires of the major firms where something smelled funny.

When it came to Lehman Brothers, foremost in the crowd of shorts was David Einhorn. There were many others (me included), but it was Einhorn who most completely critiqued Lehmans balance sheet, and most vocally called out the shenanigans there. he is the hero in this tale.

At the time, the media gave LEH the benefit of the doubt. And for his troubles, Einhorn was often criticized — even trashed — by various people. The most vocal criticism came from usually astute Charlie Gasparino (then at CNBC, now at Fox Business).

But when it came to Fuld, Gasparino was off his usual sharp game. Whether he was too close to Fuld personally, or it was simply another case of access journalism is unknown. As I warned, and Charlie acknowledged on the air, Fuld was using him. (He disagreed).

It's not real fair to pick on CNBC though. Their mission is to defend CEO's and major corporations in general from the pesky rabble. When in doubt, believe management, after all they have no incentive to ever go on air and give anything but the unvarnished truth.

But hey, if you have a moment, check out the video, it should get frozen in a time capsule. I especially love the apologist nodding in the bottom right every time the CNBC gang points out the important differences between Bear Stearns and Lehman, Jimmy Cayne and Dick Fuld, et. al.