Unless you were just rescued from a year on a desert island you’re painfully aware of the financial crisis that’s boiling over as I write this posting. Pages 1, 2, 3,….,10 of any newspaper or TV news show covers the massive failures of big financial institutions, the roller coaster ride in the markets, the effects (as the candidates like to say) not just on Wall Street but on Main Street and, unless you were really out to lunch last week, the ka-jillion dollar “bailout” of the whole mess. Seriously, if someone suggested to me in January that Bear Stearns, Lehman Bros and ING would all be gone by September I’d wonder what they’d been smoking. No doubt these are crazy and scary times, however, I read a short blog posting the other day that had the affect of slapping me out of my media-induced malaise.

I’m neither an economist nor an expert on fiscal policy, but as a marketing professional I’ve been through this a few times before in my 25 year career. I spent sixteen of those years as a marketer at various financial institutions, thirteen at either big, global banks or investment banks. I’ve marketed everything from swaps to savings accounts, asset-based loans to asset-backed securities, private placements to private banking.

I bear first-hand witness to the behavior of big banks during crises. I joined Bank of Boston the same week the Fed took its credit keys away (read: no new loans until you can show us you can drive safely) in the wake of the commercial real estate disaster of the early ’90s. I lived through the global liquidity crisis in the mid-’90s following domino-like currency devaluations around the world. My favorite was the mass write-down of Russian debt in the late ’90s that evaporated the earnings of many major banks overnight (including the one I was working for). And, of course, let’s not forget the loud “pop” that ended the dot-com era, as well as the existence of many financial institutions. All of these crises created widespread panic and a tightening of credit, the life blood of economic growth.

Today’s crisis is, of course, different and unprecedented, both in cause and effect. But just when you thought the entire banking system, and life as we know it, are crashing through the guardrail and heading down the cliff, read what I read by former Commerce Bank CEO Vernon Hill: http://bankstocks.com/ArticleViewer.aspx?ArticleID=5390&ArticleTypeID=2.

It provides evidence that even if the clouds haven’t parted yet the sun is still up there PEOPLE! In short, while the large banks are reeling, and the mostly unregulated (surviving) investment banks are gasping for breath, there are thousands of smaller, community banks out there that have been largely untouched by the crisis and, for the most part, are proceeding with business as usual. Good news if you’re running a business or a household. As a matter of fact, on the very day two weeks ago when the stock market was tanking in reaction to the Lehman implosion, our banker (note: works for a small bank) was at our office with new loan documentation that extended our line of credit for another year. New credit…hmmmm…go figure. Did I mention she was AT OUR OFFICE??

Is this just an example of me seeing the glass as half-full? Yes and why shouldn’t I? Optimism works. It keeps us getting up in the morning even if we went to bed listening to doom and gloom on the eleven o’clock news. So take a breadth, gather yourselves, and stay focused on your business and personal objectives. Should we proceed cautiously? Yes. Should we panic? Absolutely not.

-Dave Goldberg

This entry was posted on Sunday, October 5th, 2008 at 10:22 am and is filed under Bid'ness. You can follow any responses to this entry through the RSS 2.0 feed. Responses are currently closed, but you can trackback from your own site.