Paolo Pelligrini's final letter to investors doesn't address his retirement, but it surely addresses the reason for it.

Thanks to Marketfolly, we've embedded a copy below.

In short, his reason for quitting seems to be that the government has doomed the economy, and the lofting pile of crap we've built up will soon crash down and hit the markets.

What he says exactly:

The policy choices that helped spur the debt bubble concealed the inconvenient twin realities of uncompetitiveness and gaping distributional imbalances. Postponing the political resolution of the problem has only caused it to get bigger. Unfortunately, the US government is continuing to dig the hole deeper, now with a coarser, less-efficient version that uses soversign borrowing in place of private debt to fill the demand of the deficit created by the labor force's ongoing income decline.

Failure to ignite self-sustaining economic activity means government is simply subsidizing current expenditure with unprecedented government outlays, racking up a bill that cannot be repaid in full. That realization will, in my opinion, hit markets soon and with powerful effect.

PSQR-Q2-2010 -