Iceland blames male ego for financial meltdown
Posted
Oct 14 2008, 04:01 PM
by
Anthony Mirhaydari
Rating:
Though there's plenty of blame to go around in this financial crisis, the folks in Reykjavik are pointing the finger squarely at the hot-shot men that ruined that country's financial system.
Excessive risk taking and reliance on foreign capital turned the financial system of a quaint economy of 304,000 people into what some are describing as a hedge fund with a seat at the United Nations. Iceland has a $20 billion economy, yet its three largest banks maintained debts of $61 billion.
Now, with both its currency and stock market crashing, the small Nordic nation is trying to clean up the testosterone-fueled follies by appointing two women to run New Landsbanki and New Glitnir, the nationalized banks created after the collapse of Landsbanki and Glitnir. According to one government minister, this is all too typical: "The men make the mess and the women come in to clean it up."
Since 2003, Elín Sigfúsdóttir was head of corporate banking at Landsbanki. Birna Einarsdóttir was promoted to head of domestic commercial banking at Glitnir last year. It's worth noting that besides these two, there was only one other women on the combined executive teams of Glitnir and Landsbanki. It's no wonder that psychologist Julia Noakes told the Financial Times that there wasn’t enough "femininity" in the business.
There is a scientific evidence to justify the move: Research cited by The Star suggests that women are much more cautious investors, better able to stick to trading rules and recognize the limits of their knowledge. Men, on the other hand, were much more confident and placed greater faith in their trading ability. In the end, studies found that all-female investment clubs outperformed all-male peers by 4.6%.
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