Mining the Lessons of History

Investment-manager-turned-author Liaquat Ahamed, winner of the 2010 Pulitzer Prize in History for Lords of Finance: The Bankers Who Broke the World, gave an after-dinner talk to the School and guests recently, making “cogent and clear” (in the words of Head of School Michael Mulligan) the essential links among financial crises, economic crises, collapse and full-scale depression. That’s no easy task, when your audience members cover eight decades, but Mr. Ahamed started in ancient history, with a relevant cautionary tale from 32 A.D., Emperor Tiberius’ reign. Liquidity problems, runs on banks and bank closures, property foreclosures, rumors, panic, unintended consequences, collateral damage of all sorts and around the “globe” of the time--”global financial crises are, you see, nothing new.” Mr. Ahamed went on to elucidate both the similarities among financial crisis “waves” now irrefutably documented--all subject to what he calls “the doom loop of forgetfulness”--and “the one big difference between then and now: the scale of impact.” And, of course, the speed at which technology gives word--hearsay or truth--hyperflight.

After concluding his remarks, Mr. Ahamed took questions, primarily from students who asked about the impact of the Occupy Movement, about Ron Paul’s platform, and about economic reform in the Federal Reserve. Many A.P. Government students stayed afterwards to continue pressing the expert on the issues his talk had raised for them--or topics they’ve been chewing on around the seminar table.

Said Mr. Mulligan the next day, “In uncovering the topical themes, Mr. Ahamed tied together periods of economic distress over the centuries with unifying historical threads. A first-rate intellect and excellence in research were evident in his answering complex questions concisely and directly without oversimplifying. It was an impressive, enlightening evening--and an exceptional opportunity for our students.”

Educated at Trinity College, Cambridge University and at Harvard University, Mr. Ahamed has worked at the World Bank in Washington D.C. and the New York-based partnership of Fischer, Francis, Trees and Watts, where he served as chief executive. He is currently an adviser to several hedge fund groups, including the Rock Creek Group and the Rohatyn Group, is a director of Aspen Insurance Co., and is on the board of trustees of the Brookings Institution. He was also recently named by Secretary of State Hillary Clinton to her just-formed Advisory Committee. Lords of Finance: The Bankers Who Broke the World, about the lead-up to the Great Depression of 1929-32, won, in addition to the Pulitzer, the Council on Foreign Relations Arthur Ross Gold Medal of 2010 and the 2009 Financial Times-Goldman Sachs Best Business Book of the Year Award.