As Lehman collapsed over the weekend, we started getting calls from clients who needed help urgently. As the phones rang off the hook we quickly realised this was no ordinary crisis.
Lehman had been a client so technically we needed a conflict waiver from them under US rules to take on all our other clients who were desperately seeking advice on their Lehman positions. Miraculously we managed to get this in place before the markets opened on the Monday. We also took an immediate decision to ask every client to pragmatically accept we could cease acting for them on Lehman matters if unforeseen conflicts emerged in the future. All of that cleared the way for us to deal with nearly 300 requests for advice in the first week alone.
The initial adrenaline rush gave way to a sense of deep unease as confidence was sucked out of the system and business slowed. As big names like Merrill Lynch and Bear Sterns disappeared and others faltered, it’s no exaggeration to say there was a moment when it felt like the whole system would collapse. Northern Rock had already shown people the very real possibility of going to the ATM to get out your hard earned cash only to be told: “computer says no”. How long would civilised life last if the finance system collapsed?
By this time I was in New York having decided, pre-crash, to base myself there for three months. It was the worst of times and best of times. The mood among our banking clients was black. One told me I would need wellies “to wade through the rivers of blood on Wall Street”. On the other hand, Obama’s victory brought a sense of renewal on the streets. That was my abiding memory.
As an optimist, I was always confident things would eventually get better – but there was a moment when even I began to wonder.