The Moment Everything Changed On Wall Street

Wall Street didn't always exist as we know it now. Forty years ago banks were sleepier businesses - boring, even.

But then all of that changed.

In an interview with OneWire CEO Skiddy von Stade, Peter Solomon, founder of investment bank, The Peter J. Solomon Company, pinpoints the moment everything shifted.

"I ascribe it to the 1981 going public of Salomon Brothers and two issues happened. One, the firms incorporated so they had limited liability and number two they had other people's money so they could take more risk…there's no question that that was the moment that Wall Street changed," Solomon told von Stade.

At that point Solomon had spent most of his career at Lehman Brothers, taking breaks to work in politics during a time when New York City was in an incredibly tenuous financial position. There was an energy crisis, inflation was high and jobs were scarce. The entire country was hurting.

Solomon worked in former NYC Mayor Ed Koch's administration, and also worked on former President Jimmy Carter's second presidential run. When the latter failed, Solomon returned to Lehman Brothers. He said that was a mistake.

"If I had to do it again... I would've taken 6 months off," he said. He believes that's still important to do when you're making a change in your career.

Solomon's choice put him at Lehman during a fascinating time, though. It's all documented in Ken Auletta's book, 'Greed and Glory on Wall Street: The Fall of The House of Lehman.'

A battle between two rivals at the top of the firm - Lewis Glucksman, the head of trading and Pete Peterson, the head of the investment banking business, was tearing the firm apart.

"There was a famous vote, a 14-1 vote, where I'm the only one voting against 14 of my partners in terms of accepting the deal between Peterson and Glucksman because I thought it would destroy the firm," said Solomon. "It destroyed the firm."

Solomon eventually started his own business - one of the first independant investment banks. The way he sees it, Wall Street banks are returning to where they were when things were more boring. The government has regulated risk out of that sector by raising liquidity requirements.

"I think Wall Street is going to go back to where it was. I think that the Evercore's and those types of companies that have done an excellent job are going to morph into the Lehman Brothers and the Morgan Stanley's of the 1980s, thirty years ago. I think the banks are going to go back to where they are. And I think the role of folks like ourselves is to be very very, very, very good in advisory business," he said.

Watch the full OneWire interview above and subscribe to the series to get new interviews as soon as they are posted.