My Name is Mudd

An article in yesterday’s New York Times details the contribution made by Fannie Mae’s former chief executive officer, Daniel Mudd, toward the financial meltdown we are experiencing in the US mortgage securities market.  Mr. Mudd, like many other CEOs of his time, joined the group of lemmings chasing profits, placating investors and taking excessive risks.  The article points out that Mr. Mudd told employees to “get aggressive on risk-taking, or get out of the company.”  When Mr. Mudd’s chief risk officer warned him about the housing bubble and the potential negative impact to the company, Mr. Mudd argued that the market, shareholders and Congress all thought the companies should be taking more risks, not fewer.

While his name is literally Mudd, Fannie’s CEO also serves as a metaphor for the dozens of CEOs and many more executives who failed to heed the warnings of risk professionals in the face of external pressure and personal greed.   Do you agree?  Please join the conversation below.

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About Wheelhouse Advisors
Wheelhouse Advisors LLC is the publisher of The ERM Current™, an online publication and blog dedicated to providing the latest updates on current trends in Enterprise Risk Management & Control. Wheelhouse Advisors provides cost-effective Enterprise Risk Management & Control solutions to both large and mid-size corporations. To learn more about Wheelhouse Advisors, please visit our web site at www.WheelhouseAdvisors.com.

2 Responses to My Name is Mudd

  1. Sue Massey says:

    I found your site on Google and read a few of your other entires. Nice Stuff. I’m looking forward to reading more from you.

  2. Thanks Sue for sharing your thoughts and feedback. We look forward to providing you and other readers with valuable insight.

    Best regards,
    Wheelhouse Advisors

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