Does it matter that Lehman Brothers no longer exists as a private institution? It mattered to partner Ronald L. Gallatin, then thirty-eight, who joined the firm in 1972 and became a partner in 1978. While the majority of his partners on the board felt relief that Lehman, and their own capital, were rescued, Gallatin says he cried all night the day the merger was announced. “Something very dear to me, that was part of my life, wasn’t there anymore,” he says. Although Gallatin stresses that he is today happy with the results of the merger and with the Shearson people, he says, “No sum of money could ever replace the sense of pride we had at being partners at Lehman. During its some one hundred and thirty-four years of existence, our firm has been known for developing creative financial techniques and has given incomparable financial and professional opportunities to its employees. We were able to raise equity and debt for companies through methods that we created. Without these methods these companies would never have grown as they did. By raising equity for companies, Lehman created a firm economic base that became the linchpin for economic growth in this country.”

Since Shearson/Lehman Brothers will continue to raise capital for companies, one can legitimately say that Gallatin’s view is a sentimental one. The business of Wall Street is raising and making money. The new firm, like the old, will no doubt succeed in both. But those inchoate values—pride, sentimentality, tradition, a sense that one was running one’s own company and could fly as far as one desired—may be lost.

Lost, as well, is a memory. “This is a firm that survived the Civil War between the North and the South, and could not survive the civil war between Peterson and Glucksman,” says former Lehman partner Michael Thomas. “Memories are 50 percent of life. What will kill this country in the end is shortness of memory. A consensus of memory is important. I think of people like Peterson and Glucksman as custodians.”

Former partner Herman Kahn, seventy-six, who went to work at Lehman as a $15-a-week office boy in 1928, became a partner in 1950 and retired as an active partner in 1970, lives off the memories. He retains a romanticized view of a business that has produced its share of scoundrels: “To me, investment banking was a noble undertaking, whereby capital was used for social purposes as well as personal gain. When I started in this business of investment banking, you had an investment banker like you had a family doctor.”

Kahn was sitting in a small office at 660 Madison Avenue—Lehman’s uptown offices. He wore a high collar and sat behind an orderly desk. He was joined by another former partner, Paul Manheim, seventy-nine, who had also gone to work at Lehman Brothers in 1928. Both were among the few old-timers still alive, and they clung to their memories. Ignoring the feuds, the partners who didn’t speak, the snobbery and what would today be considered insider trading, Manheim says, “In our day it was a club. We were all friends. To them”—recent Lehman partners—“it was like joining Metropolitan Life.” To both men, the sale of Lehman was a sacrilege, “a tragedy.” “I wept,” says Kahn. “My home was destroyed. My church burned down. My grandfather’s grave was desecrated … Bobbie is spinning in his grave.”

The same word—“tragedy”—is invoked by another Lehman partner, Stephen Schwarzman, who is half their age and a man of recognized talent and charm. Asked why it was a tragedy, Schwarzman looked up from his lounge chair on the brick deck of the pool at his weekend house in the Hamptons and gave a very different answer. He did not first say that the sale of Lehman was a tragedy because of broken traditions, or laid off employees, or empty promises or the end of another private partnership.

The first words Schwarzman thought to say were: “This is a tragedy because the business was not sold at the optimal time. Hence, an optimal price was not realized.”