In the face of dropping stock prices and multi-billion-dollar losses, Lehman Brothers this morning announced it was doing some restructuring: COO Joe Gregory, who was been at the firm for 34 years, is out. And Erin Callan, who became financial chief in December and has become the public face of the firm’s recent troubles, will be demoted back to the investment-banking division. Both executives have been in the news a lot lately: The Wall Street Journal ran a profile of Callan in May in which her personal shopper at Bergdorf Goodman was quoted, and Joe Gregory was recently dressed down by Lehman CEO Richard Fuld in the Times after he wore a putrid green suit to the office. We joked at the time that their flamboyant fashions might affect their job security, but we had no idea we might actually be right. And if we’re right—well, then something is really wrong.