Morgan Stanley CEO John Mack describes how he navigated the firm through the depths of the financial crisis last year. He comes across as quite an amazing guy.
I found watching him give this talk quite chilling - a stark reminder of how close we came to the brink of a 1930s style great depression in September 2008. When Lehman Brothers filed for Chapter 11 on September 15th Morgan Stanley were sitting on $181 billion in cash, but at the same time they knew they were a week or two away from bankruptcy. $181 billion is a shitload of cash even for a Wall St investment bank.
At the same time, Goldman Sachs CEO Lloyd Blankfein was calling Mack saying “You’ve got to hold on because if you go we’re 30 seconds behind you”. Anyone at all familiar with Wall St will understand the implications of Goldman Sachs and Morgan Stanley filing for bankruptcy. That would certainly have been the beginning of an incredibly unpleasant time for the entire developed world.
