Five Years Later: Lessons from the Financial Crisis

In his book on the 2008 financial crisis, RBC Wealth CEO John Taft conducted a brief meta-analysis, looking at who was being blamed for the financial crisis. He found nearly two dozen issues and “arch villains” fingered for the worst economic downturn since the Great Depression. The Congressional Financial Crisis Inquiry Commission blamed regulators, bankers, and derivatives, among others; a dissenting report pointed to another 10 causes. Legendary investor Jeremy Grantham took to task Fed chairs Alan Greenspan and Ben Bernanke. Taft himself singled out a failure by banks to hew to the concept of “stewardship” (the title of his book).

The truth is, five years after Lehman Brothers’ Sept. 15 collapse, we’re still uncovering new lessons to be learned from — and actors to be blamed for — the cataclysmic events that followed. While much of the narrative of the crisis has been written, we still need to understand what caused the weaknesses and, most importantly, whether we have the right safeguards in place to stop a repeat.

Many of LinkedIn’s Influencers, like JPMorgan’s Jamie Dimon and BlackRock’s Larry Fink, were at the very center of the storm, advising the government, shoring up companies and trying to manage their own panicked employees. Others were slightly removed, but still leading through the same fog and uncertainty. Still others were close observers, analyzing and reporting as news broke around them.

For this important anniversary, we asked a selection of Influencers to weigh in on what they remember and what they’d prescribe for this still fragile economy. You can follow our channel, Financial Crisis: Five Years Later, to read all of the posts and to keep up with related articles by top publishers.

Some highlights from Influencers:

TD Ameritrade CEO Fred Tomczyk talks about what it was like to become CEO a few weeks after the collapse:

I had to tell 6,000 people that not only was the country’s financial system in dire straits, but we were going to completely overhaul our business model in the middle of it. It wasn’t exactly the situation I had envisioned when I’d accepted the position.”

85 Broads' Sallie Krawcheck gives a warning and a prescription:

We will never rid the industry (or any industry) of greed… One solution: research study after research study indicates that the smartest management teams and Boards have diverse experiences and backgrounds.”

HighTower CEO Elliot Weissbluth looks at how the crisis has cleaved the Millennials from the generations before them:

The great life lesson of this generation is that there are no guarantees. Millennials don’t trust—they just verify... They won’t do business with people who have not earned their loyalty.”

The full list below:

• Larry Fink: Lehman Five Years On: Safer Banks, But New Risks to Watch
• John Taft: Why I'm Still Worried Five Years After the Buck Broke
• Sallie Krawcheck: Want to Save Banks? We Need Fewer 'Supermen'
• Jill Schlesinger: How's the Economy Doing Now? It Depends Where You Look
• Duncan Niederauer: The Biggest Lessons from the Financial Crisis
• Neil Barofsky: After TARP, It's Time for My Next Chapter
• John Burns: What I Learned from the Depths of the Housing Crash
• Fred Tomczyk: The Challenge of Becoming a Finance CEO in October 2008
• Elliot Weissbluth: After Lehman, Will Millennials Ever Trust the Financial Markets?

Let us know what you think: Are we better off now? What should have been done? What still needs to be done? Go to my Influencer post and leave your thoughts.

(Photo: A trader works on the floor of the New York Stock Exchange September 15, 2008 in New York City. Getty Images)