Exactly 15 years have passed since the unforgettable day of September 15, 2008, when Lehman Brothers, a giant in Wall Street investment banking, filed for bankruptcy. This momentous event triggered a chain reaction that reverberates in our financial landscape to this day.
The Day That Shook Wall Street
On that fateful day, I received a 4:30 AM call bearing the shocking news of Lehman Brothers’ bankruptcy declaration. What followed was a whirlwind of events. Within hours, bewildered staff were seen leaving the bank’s European headquarters in Canary Wharf, clutching their belongings in cardboard boxes. Lehman Brothers’ collapse marked one of the most significant crises in Western financial capitalism since the Wall Street Crash.
The Precarious Brink
In the weeks that ensued, the entire British banking system teetered on the precipice of collapse. It was swift and coordinated global action, led commendably by then-Prime Minister Gordon Brown, that prevented a more catastrophic financial meltdown.
The repercussions of that fateful day continue to linger. The government remains a 38% shareholder in NatWest, one of the nation’s largest banks, a factor that may have played a role in the resignation of its former chief executive, Dame Alison Rose, in July. Economic growth has struggled to reach the robust levels witnessed in the Nineties and early Noughties while living standards have stagnated longer than almost any recorded economic period. Even now, bankers are met with a level of skepticism stemming from the revulsion that followed what became known as the global financial crisis.
Silver Linings and Lessons
However, some positive outcomes have emerged from this tumultuous period. Our banking system is considerably more resilient, and the recklessness that fueled the firestorm 15 years ago is less likely to recur. Or, at the very least, it will be detected far earlier.
A Tumultuous Decade and a Half
The past 15 years have been marked by upheaval, including austerity measures, Brexit, the COVID-19 pandemic, and conflict in Ukraine. These events have contributed to a perpetual sense of crisis.
Hoping for Calmer Waters Ahead
As we reflect on this milestone, one cannot help but wonder if the next 15 years will bring a respite from the constant upheaval. Can we dare to hope for a period of relative tranquility in our financial and economic landscape?