Skip navigation

The Boardroom Journal




Lipton vs. Milken

April 29, 2008 at 12:36 PM by Joseph McCafferty

 

Marty Lipton is at it again. Late last year, we brought you coverage of a battle that was playing out among corporate governance titans—Marty Lipton’s duel with Lucian Bebchuk on shareholders vs. stakeholders. Lipton—not known for shyness or reticence—went as far as to label an academic paper he wrote: The Many Myths of Lucian Bebchuk.

 

Now he has picked a fight with one of our greatest financial thinkers: Michael Milken. At the Tulane University Corporate Law Institute conference earlier this month, Lipton blamed the current credit mess on Milken and his financial engineering offspring. “The financial crisis we’re in today stems from the invention by Drexel Burnham Lambert of the junk bond,” Lipton argued. And if that wasn’t clear enough he continued that the link is not merely circuitous: “You can draw a straight line from Drexel Burnham to the financial world today.”

 

In a recent paper on the topic, reported in Andrew Ross Sorkin’s Times Dealbook column, Milken equated blaming him for the credit crisis to blaming a scalpel for the botched surgery of an incompetent physician.

 

That the two should square off is hardly a surprise and, for those of us who love a great sprawling policy debate, long overdue. Lipton has spent his distinguished career thinking about and creating ways for directors and managers to fend off unwanted buyers and corporate raiders, often fueled with the kind of financial machinations Milken championed. In the sport of the deal world, Lipton is the defensive guard; Milken an offensive genius. As the fathers each of the poison pill (Lipton) and high-yield bonds (Milken), their playbooks were designed with the other in mind.



Tags: michael milken (3) lipton (6) marty lipton (1) subprime (10) bebchuk (4) poison pill (9) financial engineering (1) high yield bon (1)

 Leave a comment


Trackbacks

Trackback: https://www.directorship.com/blog/trackback_receive.php/id/14273


< back