My source is of course correct. In 2009 and 2010 there was unrealistic hope: hope that 2008 was an aberration and that the financial industry could spring back rejuvenated. The big US banks strained at the Tarp leash, investment banks tweaked their models, claiming to be more client-focused, and the most senior bankers continued to take home multi-million dollar packages while shareholders were rewarded with stingy dividends: think Barclays’ Bob Diamond and Rich Ricci or the former Lehman Brothers bankers who landed at the long-suffering Japanese securities firm Nomura.
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It was also scary in 2011: it looked as if tepid European growth would mean a second leg down in the global crisis. European Central Bank president Jean-Claude Trichet bumbled around. Would more banks go bankrupt? What would that do to the fragile world economy? And then onto the ECB stage strode Mario Draghi who started to lift railway bridges with his little finger. As one LTRO followed another, those who were ahead of the crowd stopped talking about the end of the euro and started buying the government bonds of the periphery countries.