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6. Pension Fund Investments in Lehman Brothers Debt At the time that Lehman Brothers filed for bankruptcy, financial institutions serving municipalities in California were holding

6. Pension Fund Investments in Lehman Brothers Debt At the time that Lehman Brothers filed for bankruptcy, financial institutions serving municipalities in California were holding more than $300 billion in debt issued by Lehman. Do you think that municipal pension funds that purchased commercial paper and other debt securities issued by Lehman Brothers were following reasonable investment guidelines? If a pension fund is taking on too much risk, how should regulations be changed to limit such excessive risk taking?

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