The dirty secret is that shipping is a rarely profitable industry, so the "owners are too cheap" aspect is really the owners trying to go out of business as slowly as possible, hoping that times will improve in the future: if the shipping company goes out of business, it cares not one bit for the maintenance state of its fleet.
So what do you do if you're a country that doesn't want this to happen? Well, we tried regulating how international shippers operate, and it turns out that it's expensive to do that. So we ended up with flags of convenience.
It'd be easy to think that you could say "well, you need to be well-maintained, etc., etc., in order to dock at and use our country's ports" -- but that doesn't work either. There's no global inspection regime to make sure the ship is in good repair when it leaves the last port (and it can break down on the passage so that the only place it can be repaired to move again is at the same port you'd like to prevent it from using).
You also can't be too heavy-handed about the whole thing, because shipping is pretty essential to the operation of industrialized countries, and if too many shippers were to be driven out of business the result might likely be worse than the current status quo.
Because of reverse splits, the stock appears to have peaked at around $1.5B per share in late 2007. If you multiply that by the shares now outstanding you get about $130 trillion. Which of course it was never worth.
They kept issuing shares and getting asymptotically closer to zero, but I'm not sure they ever actually went out of business.
So what do you do if you're a country that doesn't want this to happen? Well, we tried regulating how international shippers operate, and it turns out that it's expensive to do that. So we ended up with flags of convenience.
It'd be easy to think that you could say "well, you need to be well-maintained, etc., etc., in order to dock at and use our country's ports" -- but that doesn't work either. There's no global inspection regime to make sure the ship is in good repair when it leaves the last port (and it can break down on the passage so that the only place it can be repaired to move again is at the same port you'd like to prevent it from using).
You also can't be too heavy-handed about the whole thing, because shipping is pretty essential to the operation of industrialized countries, and if too many shippers were to be driven out of business the result might likely be worse than the current status quo.