Distilling my theoretical work in banking

My answer to Thomas H. Stanton's question...

I can’t explain Thomas Stanton.

He tripled majored in college (chemistry, German, and, I believe, political science), got a masters at Yale and graduated from Harvard Law School.

Then he worked in/around the government, including as a member of the Financial Crisis Inquiry Commission, in which he spent a year speaking with and studying the decision makers at firms that survived the 2008 financial crisis — Goldman Sachs, JPMorgan Chase, Wells Fargo, etc. — as well as those that did not — Lehman Brothers, Freddie Mac, etc.

The difference between the two, he concluded, was whether information was allowed to flow up an organization, not just down. All news flowed up to Jamie Dimon. Only good news flowed up to Dick Fuld. Tom wrote about this in his book, Why Some Firms Thrive While Others Fail: Governance and Management Lessons from the Crisis.

Tom’s curiosity is apparent. He told me, as I often do, that if I come across anything interesting to let him know. He was particularly interested in my historical/theoretical work around the cycles in American banking. I explained to him that we have never truly understood what causes the megacycles in banking. The scholars thought they understood these things. But they were wrong, as I’m about to explain.