Greg Lippmann is best known for building and promoting short exposure to subprime mortgage securities at Deutsche Bank before and during the 2007–2008 financial crisis.
From 2005 through 2007, the Deutsche Bank position he built grew to approximately $5 billion in single-name credit-default swaps. When the short was cashed in during 2007 and 2008, it generated about $1.5 billion in profit for Lippmann’s trading desk and Deutsche Bank.
The result came with a striking institutional contradiction: Deutsche Bank still held substantial long mortgage exposure and ultimately recorded about $4.5 billion in overall mortgage-related proprietary losses.
Lippmann’s career did not end with that trade. After leaving Deutsche Bank in 2010, he co-founded LibreMax Capital, where he went on to serve as Chief Investment Officer and Portfolio Manager in structured credit and asset-backed finance.
A Quick Look at the Life of Greg Lippmann
Biography Summary
Greg Lippmann is a finance professional and investment manager whose career has centered on structured credit. At Deutsche Bank, he became known for developing and marketing short exposure to subprime residential mortgage securities as risks in the mortgage market increased.
He left Deutsche Bank in 2010 and helped found LibreMax Capital. By 2025–2026, LibreMax was managing assets in the low-to-mid tens of billions of dollars, while Lippmann remained an active investment executive at the firm.
Profile
Full Name: Greg Lippmann
Education: University of Pennsylvania, B.A. in Economics, magna cum laude, 1991
Best Known For: Building and promoting short exposure to subprime mortgage securities at Deutsche Bank before and during the financial crisis
Company / Organization: LibreMax Capital
Major Roles: Co-Founder, Chief Investment Officer, and Portfolio Manager at LibreMax Capital
Major Career Milestones: Credit Suisse; Deutsche Bank Global Head of ABS and CDO trading; development of Deutsche Bank’s approximately $5 billion subprime short; co-founding LibreMax Capital in 2010
From Penn to Structured Credit
Lippmann graduated from the University of Pennsylvania in 1991, magna cum laude, with a B.A. in Economics. Institutional biographies also state that he minored in English.
He joined Credit Suisse that same year. Over time, he became a Director and head of ABS/MBS Subordinate and CDO trading, establishing a career in the structured-credit markets.
In 2000, Lippmann moved to Deutsche Bank. He became Global Head of ABS and CDO trading in 2003. By the end of his tenure there, his responsibilities covered non-agency residential mortgage-backed securities, asset-backed securities, and collateralized debt obligation trading globally.
How the Subprime Short Took Shape
The emergence of standardized credit-default-swap contracts in 2005 became a turning point. In a later interview with the Financial Crisis Inquiry Commission, Lippmann said the new market structure gave him a practical way to take either a long or short position in mortgage securities.
According to his account, he then examined subprime securities more deeply. His analysis, conducted with help from Eugene Xu, focused heavily on the relationship between home-price appreciation and mortgage defaults. He concluded that even a moderation in home-price growth could create severe losses for thin BBB subprime mortgage-backed tranches.
Lippmann described the short as an asymmetric trade: relatively limited premium costs if the thesis failed, against much larger potential gains if the BBB tranches suffered losses.
He later summarized an important part of that thinking in simple terms: “We weren’t actually predicting that home prices would collapse.” His original thesis, he said, required only enough moderation in home-price growth to put those lower-rated tranches under pressure.
The U.S. Senate Permanent Subcommittee on Investigations found that Deutsche Bank allowed Lippmann to develop a proprietary short position in residential mortgage-backed securities despite senior management disagreeing with his bearish view. By mid-2006, he was warning colleagues and clients seeking short exposure that many underlying mortgage assets were poor quality and likely to lose value.
Deutsche Bank also required him to help offset the carrying cost of the position by persuading clients to take short positions. The Senate report estimated that this activity generated about $200 million in fees for the bank in 2006. By 2006–2007, Institutional Investor reported that his short-trade client list had grown to more than 50 hedge funds.
The $5 Billion Short and Deutsche Bank’s Larger Exposure
From 2005 through 2007, Lippmann built a Deutsche Bank short position in single-name credit-default swaps totaling approximately $5 billion.
Under senior-management direction, the position was cashed in during 2007 and 2008. The Senate investigation reported approximately $1.5 billion in profit for Lippmann’s trading desk and Deutsche Bank.
That amount was bank and trading-desk profit, not a verified measure of Lippmann’s personal compensation or wealth.
The successful short did not protect Deutsche Bank as a whole from the mortgage crisis. The bank retained substantial long mortgage-related positions, and the Senate report found that those exposures produced an overall mortgage-related proprietary loss of about $4.5 billion.
Lippmann’s Deutsche Bank story therefore contained two opposing positions inside the same institution: his desk built a large bearish trade while the broader bank remained heavily exposed to mortgage products and continued CDO activity.
Gemstone 7 and the CDO Conflict
The tension became especially visible in Deutsche Bank’s $1.1 billion Gemstone CDO VII, issued in March 2007 and later examined by the Senate investigation.
The Senate report found that Lippmann recognized a number of mortgage-backed securities in Gemstone 7 as high risk and likely to lose value. His CDO trading desk was involved in the process and did not object to the inclusion of certain assets he was disparaging at the same time.
The report also found that Lippmann was advising some clients to short some of the same mortgage-backed securities while Deutsche Bank’s sales operation marketed Gemstone 7.
The Senate attributed the challenged sales and disclosure conduct to Deutsche Bank. It found that the bank sold Gemstone securities to eight investors without disclosing that its global head CDO trader held extremely negative views of about a third of the assets or that internal valuations showed losses.
Those findings documented actions by Lippmann and his desk alongside Deutsche Bank’s conduct. They did not amount to a civil or criminal judgment that Lippmann personally committed fraud or made the challenged disclosure decisions.
Leaving Deutsche Bank and Building LibreMax
Lippmann left Deutsche Bank in May 2010. Later that year, he and former Deutsche Bank executive Fred Brettschneider founded LibreMax Capital.
LibreMax Partners launched on October 1, 2010 with $375 million in committed capital. State Street was selected to provide hedge-fund administration services, part of the institutional infrastructure surrounding the new firm from the outset.
Lippmann later described the founders’ objective this way: “We wanted to build an institutional-quality firm that would have staying power.”
The move shifted his career from trading inside a global bank to helping run an investment firm focused on structured credit.
LibreMax Growth and Lippmann’s Later Career
LibreMax grew substantially in the years that followed. A 2014 Institutional Investor profile reported approximately $3 billion in assets and described Lippmann as overseeing a 20-plus-person investment team across structured-credit product groups.
His role remained active well beyond the financial crisis. In January 2025, The Wall Street Journal described Lippmann as running LibreMax and discussed his use of interest-rate swaps to hedge against a potential sharp rise in Treasury yields.
An SEC filing reported approximately $11.9 billion in assets under management for LibreMax and its affiliates as of July 1, 2025. A LibreMax announcement later estimated approximately $14 billion as of May 1, 2026, including committed but uncalled capital.
On May 1, 2026, LibreMax also launched its first interval fund, the LibreMax Asset-Backed Income Fund, with $285 million of capital anchored by three institutional investors.
Current firm materials identify Lippmann as Chief Investment Officer and say he leads the firm’s investment, quantitative, and risk professionals. SEC filings identify him as Co-Founder, CIO, and Portfolio Manager, and an August 2026 filing continued to list him as an executive officer related person for a LibreMax fund.
The Big Short and Popular Culture
Lippmann’s connection to the subprime trade eventually reached a much wider audience through The Big Short. The fictional Deutsche Bank trader Jared Vennett, played by Ryan Gosling in the 2015 film, was based on Lippmann.
The character is fictionalized. Its dialogue, personality, scenes, and motives should not be read as biographical facts about Lippmann himself.
A Career Still Centered on Structured Credit
Lippmann’s most famous trade was built on a view that subprime mortgage securities could suffer severe losses even without a complete collapse in home prices. Its success unfolded at the same time Deutsche Bank remained exposed to large mortgage losses elsewhere in the institution.
His later career followed a different structure but stayed in the same broad field. By August 2026, Lippmann remained active at LibreMax as an investment executive working across securitized credit and asset-backed finance, more than three decades after entering structured-credit markets.
Timeline
The following timeline highlights major milestones in Greg Lippmann’s career and work in structured credit.
1991
Graduated from the University of Pennsylvania, magna cum laude, with a B.A. in Economics.
Joined Credit Suisse.
2000
Joined Deutsche Bank.
2003
Became Global Head of ABS and CDO trading at Deutsche Bank.
2005
Began building Deutsche Bank’s proprietary short position in subprime residential mortgage-backed securities.
In his later FCIC account, Lippmann said standardized credit-default swaps made a practical short position possible.
2006
Actively promoted short exposure to clients.
The Senate report estimated that related client-shorting activity generated about $200 million in fees for Deutsche Bank.
March 2007
Deutsche Bank issued the $1.1 billion Gemstone CDO VII later examined by the Senate investigation.
2007–2008
Deutsche Bank’s approximately $5 billion short position was cashed in for about $1.5 billion in trading-desk and bank profit.
May 2010
Left Deutsche Bank.
May 20, 2010
Gave a recorded interview to the Financial Crisis Inquiry Commission about the development of the subprime short thesis.
October 1, 2010
LibreMax Partners launched with $375 million in committed capital.
April 2011
The U.S. Senate Permanent Subcommittee on Investigations released its financial-crisis report, including its Deutsche Bank case study.
2014
Institutional Investor reported LibreMax at approximately $3 billion in assets.
January 2025
The Wall Street Journal described Lippmann as running LibreMax and discussed his use of interest-rate swaps as a hedge against a potential sharp rise in Treasury yields.
July 2025
An SEC filing reported approximately $11.9 billion in assets under management for LibreMax and its affiliates as of July 1.
May 2026
LibreMax launched its first interval fund, the LibreMax Asset-Backed Income Fund, with $285 million of capital.
The firm estimated its assets under management at approximately $14 billion, including committed but uncalled capital.
August 2026
An SEC filing continued to list Lippmann as an executive officer related person for a LibreMax fund.
FAQs
Question: What is Greg Lippmann best known for?
Answer: He is best known for building and promoting short exposure to subprime mortgage securities at Deutsche Bank before and during the financial crisis.
Question: How large was the Deutsche Bank subprime short associated with Lippmann?
Answer: The position totaled approximately $5 billion in single-name credit-default swaps.
Question: How much did the short make?
Answer: The Senate investigation reported approximately $1.5 billion in profit for Lippmann’s trading desk and Deutsche Bank. That figure is not verified as Lippmann’s personal profit.
Question: Did Greg Lippmann predict a total collapse in home prices?
Answer: In his own FCIC account, no. He said the original thesis required only meaningful moderation in home-price growth to impair thin BBB subprime tranches.
Question: Where did Greg Lippmann work before Deutsche Bank?
Answer: He joined Credit Suisse in 1991 and later became a Director and head of ABS/MBS Subordinate and CDO trading.
Question: When did Greg Lippmann found LibreMax?
Answer: LibreMax Capital was founded in 2010, and LibreMax Partners launched on October 1 of that year.
Question: What does Greg Lippmann do now?
Answer: As of August 2026, he remained Co-Founder, Chief Investment Officer, and Portfolio Manager at LibreMax Capital.
Question: Was Ryan Gosling’s character in The Big Short based on Greg Lippmann?
Answer: Yes. The fictionalized Deutsche Bank trader Jared Vennett was based on Lippmann.
Question: What was the Gemstone 7 issue?
Answer: The Senate used Gemstone 7 as a Deutsche Bank CDO case study. It found that assets Lippmann viewed negatively were included while his desk was involved and some clients were being advised to short related securities. The challenged sales and disclosure conduct was attributed to Deutsche Bank, not established as a personal fraud judgment against Lippmann.
Interviews
Financial Crisis Inquiry Commission Interview
This May 20, 2010 interview is the strongest firsthand resource for Lippmann’s own explanation of how he developed the subprime short thesis. It covers the role of standardized credit-default swaps, his analysis of home-price appreciation and defaults, and his view of the trade’s asymmetric risk and reward.
The Big Short and Structured Credit at LibreMax
This 2022 Capital Allocators interview covers Lippmann’s background, the subprime short, the launch of LibreMax, the firm’s investment process, and the film portrayal associated with his story. It gives readers a later-career perspective on both the Deutsche Bank trade and the investment firm he helped build afterward.
Greg Lippmann on The Dart Board
This 2025 interview touches on Lippmann’s early experiences, mentors, setbacks, The Big Short, and LibreMax Capital. It offers a broader firsthand discussion of his career beyond the Deutsche Bank trade for which he is best known.
Sources
- U.S. Senate Permanent Subcommittee on Investigations / FRASER: Wall Street and the Financial Crisis: Anatomy of a Financial Collapse
- Financial Crisis Inquiry Commission / FRASER: Interview With Greg Lippmann, May 20, 2010
- U.S. Securities and Exchange Commission: LibreMax Asset Backed Income Fund Registration Filing, LibreMax Opportunistic Value Fund Form D/A
- State Street Corporation: State Street Appointed by LibreMax Capital
- Institutional Investor: Greg Lippmann’s Game: Structured-Products Markets, The Future Face of Hedge Funds
- Milken Institute: Greg Lippmann Speaker Profile
- LibreMax Capital: Current Team / LMIFX Page
- LibreMax Capital / Business Wire via Morningstar: LibreMax Launches Debut Interval Fund Focused on Asset-Backed Finance
- The Wall Street Journal: How Five Pros Are Inflation-Proofing Their Investments
- Forbes: The Big Short and the Financial Crisis