I recall September 15, 2008 as if it was yesterday. It was the day Lehman Brothers filed for Chapter 11 bankruptcy protection - the largest bankruptcy in the history of the United States - and questions abound as to what could happen next. Could it lead to a financial tsunami? What would the effect be on the global economy? I didn't know. And I was absolutely scared to death inside, knowing that people's money and their livelihoods were at stake.
As I walked the floor of PIMCO's trading room that fateful Monday morning, it was easy to ascertain that the gravity of the situation was lost on no one. Uncertainty flew everywhere, and it may very well have been the single most difficult day of my professional life. I felt many eyes on me, and I knew that as the leader, I had to be decisive, and I had better put on a brave front through this battle. I made sure I appeared nothing short of cool and collected in order to instill confidence in others. We needed it.
I saw this battle within the marketplace as a great test of the lessons I learned aboard the U.S.S. Diachenko in the coastal waters of Vietnam as a member of the Navy from 1966 to 1969. As the ship's chief engineer, I was often at the helm, responsible for about 130 lives in the South China Sea at the youthful age of 23. It made me a man by sheer necessity. There were a few brushes with danger, a number of incidents under fire, and a full-fledged education in leadership.
The lessons that stayed with me most over the ensuing four decades are those that came the hardest. One night in the middle of the Pacific, I called the captain about an approaching tanker that was on a collision course with our vessel, and he groggily took his seat and said nothing. Thirty seconds later, the tanker nearly cut us in half - missing the Diachenko's stern by 20 or so meters. The captain had remained asleep in his seat as I remained silent, thinking he was alert, and it almost cost us dearly. I learned to always speak up, to communicate clearly, and to never assume authority was aware of the situation.
Another lesson came on a smaller vessel carried by the Diachenko. While loading the boat full of Navy SEALs to head upriver, the boat's engine began to race uncontrollably, and the sailor responsible for the boat shouted that the engine appeared to be on the brink of exploding. I had to decide whether to abandon the boat within seconds--with heavy gear and arms attached to each SEAL--or to keep them on board with an exploding engine. Their lives were at risk either way. I froze, not knowing what to do, and luckily the engine stabilized. Lesson learned, though--be decisive. Lives--and now financial assets--are at risk.
Another lesson from my time in Vietnam that left me better prepared for the day Lehman collapsed also occurred with the SEALs. Just after transporting 15 SEALs to a beach for a mission, a Vietnamese woman on the beach used the hat she was wearing as a signal for other villagers to engage in a surprise firefight with the SEALs. The SEALs were aware of such tactics but were still caught by surprise. I could only watch from a hundred meters away, completely stunned. We quickly loaded up and got back to the ship, and I learned to mentally prepare myself for the unexpected.
I heard a few times during those years how my service in Vietnam would later serve as a forerunner for the rest of my life. That always made me uneasy, because my time as chief engineer aboard the Diachenko was riddled with close calls. Luckily, my skills were a better fit in the investing world--but the lessons and experiences in the coastal waters of Vietnam shaped my view of the world in a way that proved critical in business and prepared me to navigate the treacherous waters that lay ahead.
The day when Lehman went under put it all to the test. I was at the helm of a large vessel in the world financial markets, steering through the choppiest waters in over half a century, with danger everywhere. To say I understood how much was at stake was an understatement. It could have been much worse, I think. I made sure I gave off the impression of calm to instill confidence in the trading room, and I remained decisive and communicative despite being worried of more surprise battles coming with each waking day. I'm sure happy to have made it through again to tell the tale, and I credit every moment to those formative years in Vietnam.