Ten years after the terrorist attacks of Sept. 11, 2001, the investment management industry has proven resilient, although as stories in the upcoming edition of Pensions & Investments highlight, things can never be the same.
Some of the money management firms hardest hit were Fiduciary Trust Co. International and Fred Alger Management, decimated by the loss of 97 and 35 employees, respectively, when their World Trade Center offices were destroyed. Employees at those firms will commemorate the colleagues lost 10 years ago.
The attacks left a sense of vulnerability as a permanent and ugly scar, and forever changed the way the world thinks about investments.
“9/11 fundamentally changed the world’s confidence that we’re always on firm footing and that we will get through any crisis,” said J. Tomilson Hill, president and CEO of Blackstone Alternative Asset Management.
“Before the attacks in 2001, there was a sense that governments, including the central banks, would always be able to figure out a solution to any problem. But we came very close to having the whole global banking system — the lifeblood of the global economy — close down. 9/11 contributed to the sense that the institutions we rely on are not always in control and that sense of vulnerability affects everything — markets, financial institutions, personal decisions,” Mr. Hill said.
That sense of vulnerability dramatically changed the perspective of market participants, sources said.
“There’s no doubt that (9/11) had an indelible impact in terms of changing the way that we look at the world” and think about the connections that a more global environment has created in the 10 years since the terrorist attack, said Andrew W. Lo, a finance professor at the Massachusetts Institute of Technology and chairman and chief investment strategist of hedge fund manager AlphaSimplex Group.
While 9/11 wasn’t the first incident that sparked a far-reaching flight to quality, it did mark “a coming of age of the kind of global integration that we now take for granted,” said Mr. Lo.
For more stories about the 9/11 anniversary, see the Sept. 5, 2011, edition of P&I.