Last week, we shared Eric Hazard’s recollection of a phone call that signaled the beginning of the credit default, and the financial crisis. And Monday, we shared more stories from our colleagues. Below, our last selection of anecdotes (but stay tuned for what data says has changed about the financial industry in the last ten years).
The crisis impacted my entire family
Seth Rosenstein, CFO
As the CFO of a national public relations firm in 2008, the impact to the business was not immediate. All of the Lehman Brothers-backed real estate clients immediately terminated their agreements, but it took some time until the larger consumer brands slashed their marketing budgets. The firm couldn’t recoup the lost business.
As a result of the economic downturn, the parent company that owned my agency decided the best way for them to cut costs was to push their own excess operational staff down to the agency level and dismiss the staff at the agency level (like myself, IT, HR, etc.), so in May 2009 my CEO sat me down and gave me the news. Within that same conversation, I was also informed that my replacement was coming in the next day and I had to train the person.
Wish I could say that I can laugh about it now. I took my wife and two kids (who were 9 and 10 at the time) to Macaroni Grill for dinner and my wife and I let the kids know what was happening. My son innocently said to me that he would take shorter showers to help save money. That crushed feeling on the inside is what I remember of the financial crisis.
Of course, 18 months later, I was part of the team that bought the old agency back from the same parent company that thought it was better to save their own people than to save the people on the front line. That part of the story is a little sweeter.
Finance wasn’t an abstraction anymore
Dan Simon, CEO
For me, the moment was exhilarating and terrifying in equal measure.
We were a young agency just beginning to make a name for ourselves on the Street and now the Street was changing fundamentally and possibly forever. At the same time, we were right in the heart of something. Finance wasn’t an abstraction anymore, it was all anyone could think or talk about. It was changing lives.
I remember standing outside the Lehman (now Barclays) building watching that huge wraparound LCD screen flicker and then go dark. I was 29 years old and I didn’t know whether my career was taking off or had ended before it began. I remember thinking in that moment of William Wordsworth in Paris and what he had said about the French Revolution: “bliss was it in the dawn to be alive, but to be young was very heaven!”
One of the best times to be in finance
Ishviene Arora, COO
I was young and wondering if I had joined the wrong industry and would still have a job! But it actually ended up being one of the best times to be in finance. There was so much confusion, anxiety and uncertainty on the street. And yet that meant opportunity for us because we understood the importance of transparency in a time everyone was going dark.
From a personal perspective, I had just gotten engaged and my fiancé, now husband, worked for a big Wall Street bank. I remember wondering if he would also still have a job and fearing for his life given all the bomb threats at the time. And this one time I went to a bridal show and even there the reporters were writing stories from the financial crisis angle and I was quoted in a Reuters piece on if I would still be spending money on my wedding given the crisis.
What I remember most about the financial crisis – I learned all about mortgage back securities, CDOs, CLOs, you name it! And I certainly was in no rush to buy a home.
The crisis shaped my education, career and views on finance
Marian Daniells, Senior Account Manager
Simply put, the financial crisis directly or indirectly shaped my education choices, career trajectory and views on finance. I graduated high school into the crisis, and chose my university for its generous financial aid package and its co-op program. Regarding the former, I later realized that it was so generous because my parents had been hit reasonably hard by the crisis. Regarding the latter, students took breaks from classes to work full-time “co-ops” in their industries, thus graduating with 12-18 months of real work experience. This was a deeply practical choice but in the late 2000s, anything that helped secure employment was worthwhile.
I went into journalism, which like finance was very quickly evolving – devolving, it felt like. Most of my co-ops were unpaid, something I could only accept because my parents took great pains to support me. Only as an adult have I come to understand exactly how much my parents sacrificed financially so that I could pursue my dreams. After a few years in journalism, I left to shift to corporate comms, which felt more impactful – like I could effect change rather than just report on it. And I stumbled into finance only a few years after that.
It was the personal side of finance that first drew me in. Having lived pretty frugally, I knew enough about budgeting, but voraciously consumed information about wealth and planning. I started saving for retirement, living below my means, and talking about it with friends and family to try to shake the cultural “taboo.” Following the crisis, many shied away from the markets, distrusting the finance industry. I understood that, but also began to see wealth as a tool to protect myself against future risk. I equate money with freedom: freedom from fear of a market downturn; freedom to quit if I ever want to, even if I don’t have a new role lined up; freedom to travel or pursue my dreams.
It didn’t hit until later, and gradually
Grace Devlin, Account Executive
I don’t remember where I was or what I was doing when I learned of the financial crisis. It wasn’t an inflection point for me. When Lehman collapsed I was starting freshman year of high school and was more focused on math assignments and cliques than anything of real substance. Neither of my parents work in finance – my mom works in book publishing so by nature of being part of a major industry she was impacted – but it didn’t hit close to home in that way.
I am, however, from a small town in Westchester where most of my friends’ parents work in the finance world, so I learned a lot about the crisis through them. One friend’s dad was out of work for a year. I felt bad for him. Another complained of having to give up a country club membership and the negative impact on birthday gifts now that her investment banker father lost a lot of money. I didn’t feel that bad for her.
The personal impact of the financial crisis dawned on me much after the fact. I learned that my parents’ 401(k)s were hit hard, as were college funds for myself and my brother. They’re incredibly hardworking people and made every sacrifice over the past ten years to refill the coffers and lessen our burden of student debt, but the stress and frustration took its toll. Part of me never wanted to touch finance as I gradually became more aware of the fallout of the recession. A larger part of me gravitates towards it now so that I’m able to understand it and don’t feel so in the dark the next time a crisis hits.
It takes effort to truly understand what happened
Bianca Fata, Qwoted Graduate Associate
As a Millennial/Gen Z, there are two really distinct memories that shaped my views of the world: 9/11 (I was 5) and the financial crisis (I was 12).
I was on vacation with my family when my dad got a call that his company was closing its doors in two weeks. My dad didn’t work in finance; he was a project manager at a construction company in New York, and he’d been there for about 15 years. He was luckier than most and had another job lined up. But, I remember that phone call just as vividly as I remember 9/11. And, looking back, I think the crisis is the reason I became an economics major in college.
In all my macroeconomics and banking classes, our professors showed us how the Fed could have fixed or prevented the financial crisis. The shoulda-woulda-couldas seems so simple when you take the human ethos out of it and look at it from a theoretical perspective. That’s why I think it’s really important for students and young professionals starting out in finance (or any industry) to read books like Too Big to Fail, watch movies like “The Big Short,” or hear these first-hand accounts of real people losing their jobs and homes, to truly understand what happened.