It took at least a couple of hours for news that American Airlines Flight 11 and United Airlines Flight 175 had rammed into the Twin Towers to spread through Rome, Italy, where I was living in 2001.
But when news broke, Italians, like the people of almost every other nation, spoke of nothing else for days. “We are all Americans,” front page headlines screamed in Italian newspapers for days after the attacks.
9/11’s impact was felt worldwide. It seemed that the world would never be the same again. Change was inevitable. Special news bulletins and talk shows across Europe focused exclusively on the attacks for months.
Yet in the immediate aftermath of the attacks, there was also a distinct feeling that the U.S. was now experiencing what a number of countries in Europe had gone through for years, if not decades: living with the daily threat of terrorism.
Growing up in London in the 80s, I remember our house shaking and windows shattering on at least two occasions from deadly IRA bombings nearby. Going to school in central London, you learned how to get around, and get to class, even when underground stations were regularly closed because of another bomb scare.
A few years later, when I lived in Paris, people were complacent about the heavy military presence in train stations and public buildings, even though the 1995 Paris metro bombing attacks just a couple of years earlier, perpetrated by the Armed Islamic Group who had decided to broaden the Algerian Civil War to France, had killed and wounded dozens of people.
Today, Americans, like the British, French and people of the dozens of other countries that have been struck by terrorism, are no longer looking over their shoulder in the fear that another attack is imminent and can’t be avoided. Of course, that is the way it should be.
In the immediate aftermath of the 1984 Brighton hotel bombing in the UK, which the IRA had planted with the intention of assassinating then Prime Minister Margaret Thatcher, the British leader said:
"We suffered a tragedy not one of us could have thought would happen in our country. And we picked ourselves up and sorted ourselves out as all good British people do, and I thought, let us stand together for we are British. They were trying to destroy the fundamental freedom that is the birth-right of every British citizen, freedom, justice and democracy.”
No one has forgotten the terrorist attacks that killed and maimed thousands in the U.S and worldwide. We have had to move on. Wall Street has moved on too. And many things have not changed as much as we thought they would, back in 2001.
Post 9/11, financial firms have had to put solid disaster recovery plans in place. But beyond the ability to work through a crisis, for most firms, risk management is still very much a work in progress. If there were to be another huge terrorist attack, or another exceptional event like a financial crisis, there is no hard evidence that firms are any better prepared than they were before to weather the volatility associated with exceptional events.
A recent survey of more than 500 risk and compliance executives at financial and non-financial firms around the world conducted by the Economist Intelligence Unit for SunGard showed that a majority of bankers, insurers and asset managers, as well as finance executives at non-financial companies, consider their organizations to be vulnerable to sudden swings in volatility.
The survey revealed that more than two in five respondents feel their firms are under-investing in risk management tools that could help them cope with volatility.
More than half the respondents said their company conducts stress tests or scenario analyses to check their ability to cope with volatility just once a year or every six months at most.
Life on Wall Street has moved on as it should since 9/11 and the financial crisis. But it looks like there are still some lessons to be learned.