Sunday, November 4, 2007

Up In Smoke

The bubble fallout and the big boys:

  • Citigroup Chairman and CEO Prince resigned today;

  • Stanley O'Neal was ousted as chief executive of Merrill Lynch;

  • In July, UBS Chief Executive Peter Wuffli resigned abruptly;

  • Bear Stearns' James Cayne -- Dude, Where's My CEO?

  • Monday morning update: H&R Block Inc. said Chief Financial Officer William Trubeck has stepped down from his position ``effective immediately.''

    • Posted by Harriet at 9:26 PM

    6 comments:

    TedK said...

    Harriet,

    I expected this to happen sometime in 2004. This went on and on until now. It seems to me that we have barely begun to see the extent of the problems with banks and other lending institutions, and that there is a lot more to come.

    11/5/07, 2:16 PM  
    gold_h2o said...

    I have read and heard on the radio a lot more "blame" (for lack of a better term) being directed towards the credit rating agencies....Fitch, Moody's, Standard & Poor's, etc., for not doing a better job of letting the markets know that many of the loans and Mortgage Backed Securities were bad.

    For more info. check out this link;

    http://en.wikipedia.org/wiki/Credit_rating_agency#Criticism

    At the end of the day this is just like many other bubbles....it's Capitalism (Free Markets) on the way up and Socialism (the Govn't saving the day) on the way down.

    We are somewhere in the middle right now but I would fully expect the housing bubble to become one of the biggest issues in the upcoming presidential election.

    Stay Tuned!

    11/5/07, 6:05 PM  
    Leroy said...

    It really is amazing to me that these guys were caught so flat footed.

    The warning signs were everywhere but I guess they all thought they were on top of things.

    11/5/07, 6:38 PM  
    robert said...

    Leroy said...
    “It really is amazing to me that these guys were caught so flat footed.

    The warning signs were everywhere but I guess they all thought they were on top of things.”

    Sorry Leroy. I must disagree.

    These guys were on top of things. They knew of the pitfalls and saw the early warning signs as plain as day. They knew exactly what they were doing. They are not fools.

    If a few bloggers can plainly see the writing on the wall with the little information we can glean, imagine what sort of information they have at their finger tips and what predictions can be made. It was expected, heck, planned. Mozilo is not going to get tripped up on some simple, mundane paperwork. “T’s” are crossed, “I’s” are dotted. They made their millions, now they are moving on.

    11/6/07, 1:05 AM  
    Leroy said...

    I disagree... they obviously must have been more aware of the risks than they let on, but if they knew things were going to blow up like they did they wouldn't have gotten caught with as much bad debt on their books as they did.

    I think they bought their own hype and started to believe that they were SO on top of things that they couldn't be surprised.

    11/6/07, 7:16 AM  
    Doug said...

    Banks these days do not care about the shareholders.

    They knew these loans would blow up in their face, but they preferred to balloon up the company stock, and cash out bonuses and stock options before the this happened.

    They sold billions in bad debt, and some major banks will likely go under.

    Better check your pensions and 401k, a LOT of them stand to lose major amounts of value.

    Why? These loans were sold as AAA bonds and asset backed securities. Pension funds and mutual funds gobbled them up due to their high rate and cheap cost.

    Now that they are being re-rated, they MUST be sold by these managers - at 20c on the dollar! Even the prime loans issued in 04-06 are only getting 85c on the dollar.

    11/6/07, 9:54 AM  

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