THE BEST WAY TO UNDERSTAND THE GLOBAL FINANCIAL SYSTEM 171
kets experts themselves. They had spent their careers learning
theoretical physics and did not necessarily know more about
capital markets than the everyday investor worried about her
401(k) plan.
I was an unusual participant in the field. Most of my collabo-
rators were physicists trying to learn capital markets. I was a cap-
ital markets expert who had taken the time to learn physics. One
of the team leaders at Los Alamos, an MIT-educated computer
science engineer named David Izraelevitz, told me in 2009 that I
was the only person he knew of with a deep working knowledge
of finance and physics combined in a way that might unlock the
mysteries of what caused financial markets to collapse.
I took this as a great compliment. I knew that a fully-de-
veloped and tested theory of financial complexity would take
decades to create with contributions from many researchers,
but I was gratified to know that I was making a contribu-
tion to the field with one foot in the physics lab and one foot
planted firmly on Wall Street. My work on this project, and
that of others, continues to this day.■ Similarities Between Today and 1998
I think it’s important to know that no two crises are ever ex-
actly the same. But we can learn a lot from history, and there
are some elements today that do resemble prior crises. Right
now today, as we sit here in 2015, the damage of 2008 is still
fresh in a lot of people’s minds. It was seven years ago but
there’s nothing like the experience of being wiped out and a
lot of people saw their 401(k)s erased.
It wasn’t just stock prices but real estate, housing, unem-
ployment and students graduating with loans that were not
being able to get jobs. There was a lot of trauma and distress.
That’s still clear in people’s minds, even though it was, as I
say, eight years ago. But what’s going on right now, in my view,