Giving Credit Where Credit is Due

Posted by on 11/28/11 in Debt, Stewardship

Dear Friends,

This week, we forward you a letter recently written to our good friend, Credit Markets, someone who has been taking a beating of late and yet one who has made a tremendous difference in our lives. We hope you enjoyed your holidays and found much for which to be thankful.



Dear Credit Markets,

In the spirit of Thanksgiving, thank you for your friendship over the past many years. While this has been a hard time, know that there are still those among us who remain your fans. You have been maligned in the press, undermined by politicians and bankers, and bemoaned by overzealous borrowers. You have caused riots, enhanced losses, and brought down governments. Still, we appreciate you.

When I was young, my grandfather told me how you helped him out after the War. He had returned ready to put the violence of WWII behind him and determined to escape the poverty in which he had been raised during the Great Depression. Unwilling to spend his life working for others, he conceived of a new idea in a highly competitive market. All he needed was some capital to compliment his sweat, intelligence and hustle. In the beginning he was not a typical banking client so you came to him via established business people who were willing to take a leap of faith—not a cheap leap of faith, but a leap nonetheless. And as his business grew, you came to him through more conventional means, banks and other commercial lenders. Fittingly, as the years went on and he became an established business person himself, you and he partnered to help other early stage entrepreneurs, some of whom never would have found credit through more formal channels, but found success because of the work you did with my grandfather.

I remember, too, how our friendship grew back when I wanted that business degree. Here I was, a long-haired nonprofit leader striving to become a business person, and unlikely as my potential success was at the time, that didn’t bother you one bit. You gave me a chance to reinvent myself professionally. Wasn’t easy of course, working 80-90 hours per week and school on top—and I’m still paying you back every month. It’s an easy payment to make however, a gentle periodic reminder of how I could depend on you at a critical time.

The other day, I heard a university professor insulting you in front of thousands of students, calling for them to refuse to pay back their own student loans. Ironically, he wanted those students to disown you, abandon you, in effect destroy you. It did not seem to occur to him that to assault you would be to punish the students (and professors) to come, those who would need you to be able to attend school, to earn that first degree or one more advanced, to improve or change careers, to reinvent themselves. You may feel discouraged to hear the disparaging remarks, to see students refuse to pay you back while their teachers cheer them on, to feel maligned by the very people you have helped educate and employ; but perhaps that is the lesson to you dear friend. Let higher education in America function without reliable credit markets for a few years and see how well that goes. They’ll be back, Credit. You’re a better friend than they realize.

Now you and I have had our tough times, too, as all friends do. Remember back in 2005 when you were daring me to get me to take out that huge residential loan? Don’t dodge it—you know the one. Sure, you weren’t the only one applying the screws, but that was certainly a low point in our relationship. Fortunately, I was able to tune you out and make a more reasonable decision. Had I gone along with you to that party, I would be in heap of trouble. I learned not to trust you as much as I thought I could. To your credit old friend (no pun intended!) you did give me some warnings, some clues along the way. A little wink wink nod nod as you proposed lending me so much that I’d for certain be in foreclosure now if I had accepted. Maybe you were just testing me, building a little character…I hope that’s the case. One thing that I have learned about our friendship is that I have to pay attention. Just because you’re in a crazy mood doesn’t mean I have to get crazy too. Not a bad lesson.

And we’ve had a few close calls along the way. Remember back in 2008? When I was starting a company and you were really sick, nearly out of commission? I thought that I had done all the right things, built a decent reputation, a proven track record, a solid business plan. Naïve I was to say the least! I had thought all those things pretty much guaranteed the relatively modest sum I needed to launch the company. Then you got sick and when you got sick everyone got nervous. I went to your friends at the banks but they were just fretting over your illness, talking about it incessantly, clearly nervous that they were sick too. I went to the private markets but they were so afraid of your condition being contagious that they shut themselves up and hid. Still, we eked it out just by a hairsbreadth and here we are today, thriving, growing, and making even more investment. Sometimes I wonder what would have happened if we had started just a month later…

It’s funny, sitting here late at night, reflecting on Thanksgiving and all the ways you have impacted me, my colleagues, my friends, my clients. You built our neighborhood, our kids’ school, our home. You helped educate me, finance my surgery, even pay for our wedding. You have enabled me to hire people, serve clients, innovate, invest, and change our little corner of the world. Sometimes I have taken you for granted, but recent events have underscored how precious you are; I truly appreciate your presence in my life.

That said, I promise to be worthy of your friendship. At a time when you are unpopular, unloved, and discredited, I will stand by your side. I will honor my commitments to you and encourage others to do the same. I will continue to trust you, to reach out, to give you opportunities to prove yourself. And I will share in the risk-taking inherent in a meaningful relationship with you.

I realize that you, dear Credit Markets, do not receive much fan mail during the holidays, but this is a funny year. As we witness the crowds of Tahrir Square and the lines at job fairs in Manhattan, help Japan and Haiti rebuild, and strive to keep our cities afloat, your friendship and good health are as important as ever. I give you thanks and look forward to many years of friendship.