In modern times, in the aftermath of business difficulties, many of us often exclaim, “That’s no way to run a railroad.” What we mean, of course, is that leadership was lacking, or that leaders made critical errors. The phrase is derived from the caption of a Depression-era cartoon that showed a signalman peering out of his box as two trains below him collided, exclaiming “What a Way to Run a Railroad.” Either way, that caption may well be an apt description of the way many business leaders have handled the current sub-prime mortgage crisis. As the impact of the crisis rattles financial markets and reverberates through the rest of the economy, observers are left to ponder how some supposedly financially sophisticated firms could be so ill prepared for this manmade disaster, while other firms have managed to weather the storm quite successfully thus far.
