As Wenger prepares to renew a traditional top-flight rivalry in the FA Cup this weekend, he took time to reflect on the Yorkshire club's sudden fall from grace.
"When you have no money you can only go down. It's down to management," he told arsenal.com.
"The problem is that you're in an environment where everybody pushes you to act like finances are not important, but at the end of the month you have to pay everybody.
"No [I did not see Leeds' problems coming] because they were continuing to buy. And after they sold some players, like Rio Ferdinand for £30million, you think 'OK, now they can have a breather', but the hole was much bigger than we expected.
"The only thing we have all learned is that when they announce £10milion debt, it's £30million.
"With Portsmouth it was the same. They sell a player and you think 'OK, now they are safe', but it's always worse than you imagine."