As a result of its spectacular tech fail on Aug. 1, Knight Capital became the latest financial services firm to have pushed to the brink of collapse before being either rescued at the eleventh hour or permanently wiped out.
August 10, 2012
Drexel Burnham Lambert
By 1986, Drexel was Wall Street's most profitable firm, with earnings of more than $500 million on revenues of $5.3 billion. Just four years later, the firm’s parent company found itself strapped for cash amid growing turmoil in the junk bond market. The once-dominant investment house that had fueled many of the biggest corporate takeovers of the 1980s defaulted on a $100 million loan and filed for Chapter 11 bankruptcy protection on Feb. 13, 1990, fatally wounded by a scandal involving its most infamous employee, junk bond king Michael Milken.
