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September 16, 2008

A Nightmare on Wall Street

In the wake of rumors about AIG, the Lehman Brothers collapse and the recent acquisition of Merril Lynch, Tom Peters has posted on the Financial Industry's 100 year storm.

He sounds surprised. I'm not.

I recall the raging mergers and acquisitions space over the past 5 years. I recall Blackstone beating everyone up and walking away with gigantic pools of money, and I recall the bubble growing bigger and bigger.. and then it popped.

The starters pistol, as I remember, was the Blackstone IPO which didn't fetch what was expected, and then a whole sorry spiral from there into sub-prime, exposed lenders, and the obvious mess that follows it.

All bubbles burst. Remember the Dot Com bubble? Thousands of companies scrambling to get online with tenuous or non-existent business plans? Unbeatable, the unstoppable "new" economy, and then it all came back to earth.

But like real estate in the 80's, the "new" economy has come back. The bursting of the bubble just cut out the stupid ideas and the garbage in the industry. Google actually launched during the Dot Com crash, Amazon is bigger and better than ever, and the world is forever changed by companies like LinkiedIn, Facebook, MySpace, Salesforce,.com and so on.

The bursting of the bubble does bring troubled times. No doubt of that, but ultimately it reinforces the sector that burst, or gets rid of stupid ideas like FedEx-ing dog food. (Great one...)

And this financial hit is going to do the same. Those who weren't playing fair, or were playing fast and loose with their shareholders responsibilities are starting to feel the pain of their errors. And such is life.

For consultants in the financial sectors this is a fantastic time to sew the seeds of future success, another exciting time for us!

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