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September 14, 2008

There But For the Grace of God . . .

I am following the fast decline of Lehman Brothers, which could go into bankruptcy at midnight. A few months ago I tracked the decline of Bear Stearns, whose offices I walked by daily as I entered Grand Central Terminal.

Each time I hear their names I feel a jolt, because I easily could have been working for both of them. A headhunter approached me about a web communications job at Lehman, but nothing happened. Then, between jobs two years ago, I interviewed for a proposal position at Bear. I was mildly interested, but something told me the culture didn't fit my personality, so I passed on the opportunity.

Meanwhile, the gyrations of the financial industry cast shadows around me with other associations. I owned stock in Merrill Lynch 20 years ago, when I thought it was a good buy. I sold it, can't remember when, but I regretted the sale. Now, maybe I was smarter than I thought.

With the pillars of finance quivering, I wonder at the mentality, the vision, that led to these debacles. What pursuit of wealth blinded brilliant financiers to the consequences of their actions? Did anybody at a bank or brokerage firm say "no way" to subprime mortgages and other strategies? A book exists in the culture of jump-off-the-cliff risk taking that led us to this situation. Some might point to a lack of regulation, and that's valid. I'm curious, however, in the hubris of those who believed too blindly in their theorems, hedging and a bit of the "greater fool" approach (find a greater fool to buy the lame investments), and followed the siren song of outlandish profit straight over the edge to smash their ancient firms on the rocks far below.

Van | 09/14/08 at 07:05 PM | Categories: NYC

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chuck | September 15, 2008 05:02 PM

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