I was at Lehman in 2007-08 and saw first-hand the firm implode. But what interests me was this statement: "I would spend days attempting to understand the intr

I was at Lehman in 2007-08 and saw first-hand the firm implode. But what interests me was this statement: "I would spend days attempting to understand the intrinsic value on structured bonds collateralized with physical jet engines or commercial real-estate scattered across various regions of the country." Everybody bangs on about how complicated and opaque products like derivatives and asset-backed securities are... yet the most complex product of all no one bats an eyelid at: the share (or stock). The pay-off of a derivative can be modelled by a mathematical formula (and if not a closed-form solution than via a Monte Carlo distribution) but the pay-off of a stock - that's quite different. Modelling future company cash flows is not trivial.