John Mack on the inside of the financial crisis

A friend recently sent me a link to a talk John Mack gave at Wharton that I think is absolutely fascinating. I’ve read a number of books and articles about the key events surrounding the financial crisis but I find these sorts of first person accounts so much more interesting. And I think Mack is an extremely engaging person.

I started my career at Morgan Stanley as an analyst in 1994 and actually had a great personal encounter with Mack that was probably my most memorable moment working in the banking industry. I was just starting my 2nd year at MS and was holed up in an empty office editing a draft of an offering document. Having undoubtably slept only a few hours the night before, I’m sure I was hardly the picture of professionalism with my slightly long hair, undone tie and stocking feet up on a chair, when in walks the head of my group, the head of the Investment Banking Division and John Mack. Mack says to me: “Do you mind if we use this conference room for a few minutes?” Startled, I respond something to the effect of: “Of course. I was just using this for a quiet place to review this document,” and started to gather my things. Walking out of the office, Mack calls to me and says: “I know a quiet place for you to read up on the 42nd floor.” (that’s the executive floor). I sort of chuckle but quickly realize that he’s serious. He introduces himself and picks up the conference phone: “Barbara [I’m making that up – I can’t remember his assistant’s name], Seth Levine is on his way up – can you please make him comfortable in my office.” Five minutes later I’m sitting in John Mack’s office. Alone. Reading (or trying to read, at least) and mark up a prospectus. And for context, at the time my apartment in NY was maybe 300 sq ft. Mack’s office was probably 8 times that size. I was sitting at a small round conference table, but the room also contained a sofa and chairs seating area, at least two desks and plenty of other things I was likely too nervous to notice. About 30 minutes later Mack comes back and proceeds to sit down and talk with me for probably 20 minutes. What did I study in school? how did I come to work at Morgan Stanley? how has my experience been? etc. The man is as engaging as he appears on this video. I can see why so many people are incredibly loyal to him.

  • Great story in the first person from center stage of the crisis.  I still haven’t sorted out the mix of moral failure (business and gov’t) vs. informational problems that led to the crisis.  But his message of doing the right thing is spot on.  Especially with your personal experience as an intro, this was fascinating to watch. 

  • Seth,
    Great story. Amazing how a small interaction with someone years ago can make such an impression.I have a surprisingly similar story from my days as an investment banking analyst. In 1997, I was a first year analyst at Goldman Sachs, and I was staffed on a deal w Hank Paulson, who was running investment banking at the time. Yes, that Hank Paulson — future CEO of Goldman Sachs, future Secretary of the Treasury, and everyone’s favorite punching bag through the financial crisis of the last few years.Just like your interactions with John Mack, I was amazed at how gracious and kind Hank was to me, a puny little 21 year old punk banking analyst. He treated me with the utmost respect, was appreciative of my hard work on the deal, and really showed an interest in me and my ability to contribute, in whatever small way, to the success of Goldman Sachs. That interaction left an indelible mark on me, and has caused me always to treat junior people — whether at my company, or at service provider companies like law firms or accounting firms — with a lot of respect and dignity. You’d be surprised at how few people follow this basic rule of treating others as you’d like to be treated yourself. Hank Paulson taught me that lesson 15 years ago, and I’ll be forever grateful to him for that.

    • Incredibly similar story Spencer. It’s such a good reminder that you don’t
      have to be a jerk to get to the top. A few of the first “rich” people I ever
      met were real assholes and for a while I thought that was what it took to
      have that kind of financial success. Then I met Mack and eventually people
      like Don Sturm (who was incredibly gracious to me) and Bonderman (who I
      obviously didn’t know as well as you did, but at least to me he was always
      very nice) and I realized that you could be nice and rich at the same time –
      it was just a bad initial sample!

  • KP

    Thanks for posting JJM’s speech. I enjoyed reading about your talk with Mack – I had a 3 1/2 minute talk with him in 2003 when I was a backoffice VP – I remember every word of it. He is truely an inspiring leader. 

    PS I have just tweeted this to #leadership

    • There was no question in my mind after talking with him (and it sounds like
      you had the same experience) why he was such a successful leader. Thanks for
      the comment (and the tweet).