I think they are expecting a major financial crisis which isn't quite the same as a collapse, though I don't really want to stand around trying to identify one or the other...
I believe we are seeing these comments from abroad because there is genuine shock at just how badly our institutions have behaved in creating this mess and just how poorly our government has been at regulating our financial institutions.
We don't hear much from our government because they're trying to keep things calm and orderly to avoid a yet deeper crisis. And you don't hear it from the financial institutions because they are trying to save their butts and hoping it won't get worse.
Personally, it enrages me to know that major executives have not been stripped of all their ill-gotten wealth. Remember, all these bozos were being paid in multiples of millions while they recorded illusiory profits. They've still got that money, even if they don't have their jobs. The rest of us are left with the disaster they helped create.
The FBI has been running a "10 Most Wanted Fugitives" list since 1950. (see http://en.wikipedia.org/wiki/FBI_Ten_Most_Wanted_Fugitives%2C_2000s#Year_2000). Those that go on the list are usually brought to justice pretty quickly, often in a matter of days or months.
The 10 Most Wanted Fugitives, however, have done far less damage to the American people than any corresponding list of "The 10 Most Irresponsible Executives" that we might put together. Fugitives damaged, or took, a few precious lives. Often in ghastly ways. But the 10 Most Irresponsible Executives have done far more damage and to millions of lives.
I'm not alone in this anger. In the June 16 issue of Forbes magazine value investor David Dreman made this pointed comment:
"After these errors that cost their shareholders 40% to 50% or more in market price, do senior managements show any remorse? Charles Prince, the former chief executive of Citigroup, took a retirement plan of $29.5 million plus a $10.4 million bonus. Stanley O'Neal at Merrill Lynch took home a $161.5 million paycheck."
He went on to discuss the dilution losses brought to shareholders at Washington Mutual and Wachovia, but noted that Kennedy Thompson was still top dog at Wachovia. He didn't mention Countrywide, or Bear Stearns, or Lehman, or....
Scott
