In 2007, an impending crisis in the subprime mortgage market was brewing in the United States. As such, the percentage at which lending institutions loaned borrowers with low credit ratings unconventional mortgages, with a larger-than-average risk of default on the loan, rapidly rose causing concern. As a result, economists boldly predicted that the “housing bubble” would soon burst. Concurrently, domestic and global banking institutions scrambled to fix the corrupt mistakes and organizational practices of the past. Unfortunately, these efforts and more were made in vain for Lehman Brothers, the once fourth-largest investment bank behind Goldman Sachs, Morgan Stanley, and Merrill Lynch, collapsed on September 15, 2008.
Lehman’s immediate bankruptcy filing sent shockwaves around the globe due in part to the substantial loss of client, the unprecedented loss of stocks, and the embarrassing devaluation of assets by Moody’s and Standard and Poor’s (“Triple A”, AAA, bonds were rated below average). Additional global shock derived from the massive price tag attributed to the filing, which totaled $691 billion. Thus, Lehman Brothers’ filing to date remains the largest bankruptcy filing in United States history. Although its competitive brother-in-financial-arms Bear Stearns had collapsed in March 2008, and had subsequently been acquired by JP Morgan Chase, the Lehman Brothers collapse was the catalyst for the global financial crisis commonly referred to as the 2008 Recession. Furthermore, Lehman’s demise prompted the United States government, specifically the U.S. Department of Treasury, to unveil TARP (Troubled Asset Relief Program), which then President George W. Bush signed into law on October 3, 2008. TARP’s signage ensured that Wall Street would not suffer any further collapses because they are in essence “Too Big To Fail”. It has been a decade since the acknowledgment and declaration of the financial global crisis and the effects linger. Economically, the United States continues to pick up the pieces in the hopes of climbing back to global, fiscal dominance. Politically, Democrats and Republicans continue to use crippling credit card and student loan debt and devastating national unemployment (all results of the crisis) to argue for and against tone-deaf legislation. Socially, and economically intersected, the widening gap between the rich and poor enables classism, racism, sexism, and systemic oppression as a whole, to flourish. Personally, the effects of the crisis were transformative - I waived my decision to work on Wall Street and decided to use my Economics degree to teach Black and Brown students about the foundations of money and banking. Thus, after matriculation from NYU in 2010, I began my tenure in education. Although altruistic and void of self-service, being hyper-aware of the deceptive and predatory practices within capitalism, while working to build the same awareness among students and their families that is also void of cynicism is, emotionally taxing. Furthermore, the output (paycheck) does not often reflect the input (curriculum, dialogues, trainings, an workshops). As a result, I must work twice as hard to practice self-care and financial wellness to ensure that I am aligned and centered with myself and mission. There is no formal definition of financial wellness for the term and subsequent definition are as unique as the individual's quest to achieve it. However, I have come to believe that financial wellness is synonymous with freedom – the freedom to make financial decisions without consequences. When I am equipped with the financial tools, I am less likely to make catastrophic mistakes. Fortunately, I am working to come a place of financial peace and ease. As I brainstorm, implement, and amend strategies, I am intentional about acknowledging my budding disenchantment with capitalism and all of its tenets. I find that each discovery about the realities of money are harsh. One harsh discovery is that while money is a vessel to ultimately making dreams come true, it has never been in excess for women of color to propel their dreams. Thus, as disenfranchised and marginalized women continue to bust myths and re-write narratives, we must be mindful that opportunities often do not come around twice; we must proactively save every penny earned. As I write, I am quite alarmed to see how the relationship between finances and emotional, mental, and physical health has solidified. Sadly, I report that the occasional ebb and flow of my finances has contributed to the ebb and flow of my emotions. Yet, I am steadfast about brainstorming strategies for financial success such as creating Excel spreadsheets for budgeting, manually tracking expenses, and utilizing a “Money Diary”. My diary allows me to have honest and transparent conversations about my fiscal behaviors as I work toward financial freedom. Along my journey, I remember to applaud the small victories, and I highly encourage everyone do so, too! Celebrating the small victories is encouraged for it provides the support necessary for achieving short-and long-term goals. To start, clap for brown-bagging your lunch 4 out of the 5 days for completing 80% of a goal is better than 0%. Clap for placing $20 into your savings account this week for you are 1/5th of the way from completion. Moreover, with four days left to the month of September, use these days to not only reflect on this decade of financial inconsistencies, stability, and uncertainly, but to commit to earnestly improving your relationship with money.
1 Comment
Jerry G.
9/29/2018 16:27:59
This is one of my favorite posts. It's never too late to become financially savvy and responsible. We can all do better to avoid being in a troubling predicament. I'm thankful that there is a resource like this blog to help guide folks who are struggling to budget their everyday lives or for those looking at new tips and tricks to implement into their financial routine.
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WhitneyEducation enthusiast whose mission it is to see Financial Literacy receive well-deserved shine. Archives
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