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Credit Crunch Unmasks Madoff

Posted by: Matthew Goldstein on December 12, 2008

For years there were whispers on Wall Street about Bernard Madoff’s hedge fund. The cynics said the returns were too good, too steady and Madoff’s operation always looked too slim for the tens of billions of dollars it was managing. But given Madoff’s more than four-decades of experience as trader and past service as chairman of the Nasdaq Stock Market the wealthy kept giving him their money.

Well, it looks like those concerns were right all along now that federal prosecutors have charged the 70-year-old Madoff with securities fraud, in what could amount to one of the biggest Wall Street scams ever. Securities regulators, in a civil complaint, say Madoff’s scheme may have cost investors up to $50 billion—although that figure appears to be based on Madoff’s own bravado. At a minimum, it appears the $17 billion Madoff was managing earlier this year may be gone.

The allegations against Madoff describe a classic Ponzi scheme, in which money is taken in from new investors to pay out money to earlier investors. Madoff, authorities allege, even told his sons earlier this week that the hedge fund was nothing more than “a giant Ponzi scheme.’’

It didn’t take long for investors in Madoff’s fund to begin crying foul. Hours after the news of Madoff’s arrest broke, investors were contacting lawyers to determine how they can get their money back—assuming there is any money left over. The Securities and Exchange Commission is moving to appoint a receiver to take control of the Madoff fund to protect whatever assets remain. Scott Berman, a lawyer who represents a number of Madoff investors, says the fear in a case like this is that the investors will be left “fighting over the crumbs.”

Many of the investors in Madoff’s hedge fund were so-called fund of funds, investment vehicles that invest in a wide array of hedge funds to spread around the risk of anyone hedge fund collapsing or incurring steep losses. But fund of funds, which often juice their returns with leverage, are getting hit hard in the market plunge. On average, fund of funds have suffered greater losses this year than the average hedge fund.

It’s way to soon to know how long the alleged scheme had been going on, although authorities allege it began years ago, after Madoff tried to cover up for past losses. But it appears Madoff ultimately was unmasked by the worst financial crisis since the Great Depression. Just like many hedge fund operators, Madoff received a wave of redemption notices in recent months, from investors looking to preserve cash. Authorities say investors sought to pull-out some $7 billion from the fund—money Madoff apparently did not have.

In the end, most Ponzi schemes collapse when too many investors seek to pull their money out at the same time, and the operator doesn’t have the cash on hand. Many a scheme has failed when the markets turn south. One potential red flag that investors failed to notice along the way is that the hedge fund was being audited by a small outfit in Rockland County, NY—not one of the large accounting firms.

But the financial crisis appears to be hastening the unwinding process of potential scams, as it has dried-up all sources of liquidity. Banks are unwilling to lend and investors are fleeing hedge funds, stocks, bonds, commodities and other asset classes for the safety of cash.

In September, another alleged Ponzi scheme collapsed, when federal prosecutors arrested Minnesota businessman Tom Petters. Federal prosecutors allege that much of Petters’ empire, which consisted of buying up distressed businesses, was based on a series of lies. He’s been charged with bilking some six-dozen hedge funds out of $3 billion. Petters’ alleged scheme came undone when some of the hedge funds that lent him money had gotten redemption requests from their investors and began asking Petters to pay-off his debt. Just like Madoff, Petters apparently couldn’t come up with the cash. Several of the hedge funds that lent money to Petters are in tatters, and some are shutting down.

A lack of liquidity may have been behind the bizarre scheme involving New York attorney Marc Dreier. Earlier this week, federal prosecutors charged the high-profile attorney with allegedly scamming several hedge funds into giving him up to $100 million by selling shares in what appears to be a fraudulent real estate venture. It appears Dreier’s 250-lawyer firm was running low on cash and had failed to make payments on a bank loan.

As the financial crisis deepens, don’t be surprised if other scams get flushed out in the coming weeks and months.

Update — Dec. 13, 2008

The Madoff scandal beyond causing pain for the investors in these hedge funds is causing some discomfort for securities regulators. Late Friday, the Securities and Exchange Commission, in response to questions about its past oversight of Madoff’s operatoin, says it twice investigated his firm but apparently found no wrongdoing. Over the years, the SEC had received a number of tips of potential problems at the Madoff fund. Now, uncovering fraud is no easy task. But this episode raises new questions about just how aggressive regulators are when they conduct periodic examinations of the brokerages they oversee.

Update 2 - SIPC coverage

I haven’t researched this issue lately, but a number of people have asked about SIPC so I’m throwing in my 2 cents. If a person was a customer of Madoff’s broker-dealer arm, SIPC coverage would be available. It’s unlikely SIPC would cover losses sustained by Madoff’s hedge funds customers. Although SIPC can offer some coverage in a case of outright theft by a brokerage firm. Either way, it’s best to contact a lawyer, given this mess will take a long time to sort out.

Reader Comments


December 12, 2008 12:09 PM

Last year on December 26th 2007, an Article came out entitled- BLACKROCK RISE DESPITE FROZEN FUND (you can still 'Google' it!), and investors were told, in a letter, that the fund didn't have the money to meet the demands of the clients who wanted to cash-in. Then, in late March, Ben Bernanke gave $29 BILLION in TAXPAYER'S money to BlackRock Inc. Earlier this year there was an Article about a state back east, I believe it might have been Connecticut, that handed over their state employee's PENSION FUNDS to BlackRock Inc. to mamage. Am I seeing something wrong here? WHY would the FED hand over $29 BILLION to BlackRock when BlackRock couldn't meet the demands of their own clients in December of 2007???????? Anyone?

Hartley Lord

December 12, 2008 12:12 PM

The real problem is how many more of the 10,000 unregulated hedge funds turn out to be ponzi schemes. The SEC and Federal Reserve's anxiety to deregulate
are a definite contributing factor.


December 12, 2008 12:14 PM

I forgot to add in my earlier comment that the Article about the $29 BILLION in TAXPAYER'S money that Ben Bernanke handed over to BlackRock Inc. is entitled- BERNANKE BEAR AND THE $30 BILLION QUESTION (you can 'Google' it!). Happy holidays!


December 12, 2008 12:14 PM

I'm EXREMELY happy.

The whole investment world is one giant Ponzi scheme. In fact, this country is pretty much a Ponzi Scheme.

All of you, "investors",who try to live off someone else's creativity and hard work are essentially parasites. You deserve to lose every penny that you didn't earn by the sweat of your own brow. All of you, voracious readers of Forex, NYSE, and Nasdaq "tea leaves" and "coffee grinds" should get suckered by someone like this Madoff character.

Unfortunately, because Madoff is Jewish, a poor schmuck like my neighbor Mr. Ramirez will be thinking of me, a poor Jewish schmuck like him, as a "money-grubbing Jew".


December 12, 2008 12:19 PM

And yet so few of these guys ever see jail time let alone have all their assets seized. Maybe they should just put these crooks in a room with their investors armed with baseball bats.


December 12, 2008 12:47 PM

In response to Hartley Lord's comment, the unregulated hedge funds are not the problem. Madoff's company was registered with, and regulated by, the SEC in two different capacities (as an investment adviser and broker/dealer). Yet in the last several years, while the SEC has been whining about its need to regulate all hedge fund managers, THIS hedge fund manager committed $50 billion in fraud right under the SEC's nose. Regulation of more hedge funds is not the answer. The SEC can't even handle the funds it regulates now.

norman ravitch

December 12, 2008 1:06 PM

As we laugh at Gov. Blago trying to make a buck -- and probably legally at that -- here is a classic example of a swindler. Sam, however, need not worry about a "money-grubbing Jew" being caught: most of the financial experts helping Obama are also Jews. They can be found on both sides of the criminal line.

Lemmy Caution

December 12, 2008 1:07 PM

Maybe he should ask congress to bail him out.


December 12, 2008 1:07 PM

Don't worry about Mr. Ramirez - after all, who cares what illiterate beaners think anyway?


December 12, 2008 1:14 PM

Anyone know where I can find a list of charities and andowments involved?


December 12, 2008 1:19 PM

The Madoff scam finally brings to light the Petters scam that blew up in late October. We've been screaming about the lack of coverage. These are going to be popping up all over in the next couple of years. You will also notice how negligent [and criminal] the general partners and accounting firms representing the hedge funds were as well. YOU WILL BE SHOCKED!!!


December 12, 2008 1:23 PM

Ooh, I have a good one for this company…

First, Karl, there are many reasons a fund can freeze its assets. You base your entire argument on one article about a 2 billion fund of a manager that managed 1.4 trillion at the time. No numbers… no reasoning… what’s your point?

Hartley, What do you care about the 10,000 hedge funds? How does it affect YOU? Did you invest into any of them? If so, did you do your due diligence and made sure you know who are you giving your money to? If so, you have nothing to worry about.

Sam, most people, including me, have to first work harder than everybody else to become investors. Work several jobs and go to school at the same time and study while our friends are going out and spending their $10-$20 and hour job proceeds on beer and chicks. Then we have to be better than anyone else at our jobs… work long hours… etc etc. Finally, when we get THERE we get to hear our old friend-alike lazy bastards whine that we are the EVIL kind that we somehow live off of them. Note that I don’t see anything wrong with having old money in the family either even though I’m not one of the luckies.

I agree with Dave though. That surprises me too.

Payback Time

December 12, 2008 1:30 PM

Upon reading this story about Madoff, every wretched poor working class person in this country should be absolutely jubilant, indeed ecstatic. I know I am. My sincerest hope is every single one of the capitalist leech bloodsuckers taken in my Madoff lose every last penny.

Keep up the Good Work!!!!


December 12, 2008 1:31 PM

it's all just greed by the rich. all these fund raising events they go to are just ways to get seen and heard by the public with their tuxes. It's all a scheme to get others to get each other's backs. Don't let those rich people make you believe they are giving to charity. They're just trying to get more. lying monsters, they are!

Joe Wilson

December 12, 2008 1:39 PM

Chris Cox has to be fired...this is it!


December 12, 2008 1:46 PM

Alex, I guess that you don't see the POTENTIAL for any problems with BlackRock, huh? I guess $29 BILLION in TAXPAYER'S money isn't a big deal, right? I guess that BlackRock's stock in late March, which was over $200 a share compared to where it is now, at around $125 or so, isn't a big deal, correct? If the TAXPAYER'S money has done what BlackRock's stock has done, then it has LOST A LOT OF VALUE, hasn't it? Maybe YOU like companies that LOSE a LOT OF MONEY, right? I'll bet that the TAXPAYERS of the USA are a lot different than you. "Only a pawn in their game." - Dylan. P.S. $1.3 TRILLION can disappear just as easily as $2 BILLION!!!!!!!


December 12, 2008 1:46 PM

Regardless of what side of the criminal line your on in terms of making money, it's a crime what many make while the common man is getting the axe from their millionaire employers. When will someone openly admit that there needs to be a cap on what people make - no matter how worthy they think they are. I would like to start hearing about this, even if's a pipe dream, it would still be nice.


December 12, 2008 2:04 PM

To Payback time - what an incredibly ignorant thing to say, especially in this terrible economic environment. This is not a time to stir up antagonism between different classes. It is important to remember that "poor working class" people are owed hundreds of billions of dollars through their pensions plans. These pension funds invest in traditional (direct equties & bonds, mutual funds, index funds etc) as well as alternative asset classes (hedge funds, fund of funds, private equity, venture capital etc). When pensions lose money with someone like Madoff (or any other investment), no one should celebrate, especially not those who are entitled to the benefits from a pension plan. This country, even before this crisis began, has been suffering from bloated pension obligations and chronic underfunding by both corporations and governments - this mess just makes everything worse.


December 12, 2008 2:07 PM

Great post Alex.

Everyone else, Madoff was not a hedge fund. he was a HIGHLY REGULATED INVESTMENT ADVISER. He was under the magnifying glass of the SEC and the NY securities authority. He must of been real good at what he did to get away with so much for so long.


December 12, 2008 2:15 PM

Nice to see anti-semitism alive and well - I find those posts sickening. You know who said money cant buy you happiness? POOR PEOPLE.

They say money cant buy you happiness - look at the smile on my face - ear to ear baby... :D

As for "IM HAPPY THAT PEOPLE LOST THEIR LIFE SAVINGS" - that is poor and pathetic. If you have ever worked for a company, that person took the risk and got the reward.


December 12, 2008 2:29 PM

I can't believe that there are people that are happy people lost money in Madoff. My Father came to this country with nothing and work hard all his life to make something of himself, which he did. Now at 83 years old he just lost much of his retirement funds, and you idiots are happy. I guess it's because your jelous losers, who have not done anythingwith your lives.


December 12, 2008 2:47 PM

Why is the company website still up? What are they waiting for? should now point to the FBI website.

Bob Snyder

December 12, 2008 2:59 PM

Sam, you don't understand the first thing about the capital markets. The purpose of the capital markets is efficient allocation of capital. Efficient allocation of capital is what creates a growing economy. Go take Business 101. People get a Market risk premium over the risk free rate based on the uncertainty of future cash flows. An opinion is only as good as the amount of education behind it. Educate yourself.


December 12, 2008 3:01 PM

I believe that the only way out of this mess is for the government to invest some of the $700 billion into government funded coupons for ordinary products for ordinary citizens
People have stopped shopping (spending)
This narrows down demand

This approach will effectively pump the prime ie. The economy and increase demand (vs. supply)
For everything (since great coupons are worthless unless spent)

In addition the government can selectively determine who to give their trust to, which will be the loyal tax payer.


December 12, 2008 3:07 PM

My company was a victim of him.

Jonathon Goodman

December 12, 2008 3:19 PM

Note to SAM

did you have a liquid lunch buddy? Lay off the sauce and get back to work.


December 12, 2008 3:24 PM

I am with Sam.


December 12, 2008 3:37 PM

My cousin runs a hedge fund and uses Madoff as his broker. It's a private fund and all his clients are family and friends. Now we are all victims of this fraud. Capitalism really breeds greed. I know I invested because of the high returns which turned out to be a mirage.


December 12, 2008 4:02 PM

"Efficient allocation of capital is what creates a growing economy." So then it's safe to say that sending jobs over seas creates a growing economy, since companies are being efficient? Whereas people loose or can't get jobs, so they stop spending money? And if this is a market based economy, what good is it then if consumers can't be consumers?

Go take Ethics 101.

There are those that believe that a market based economy creates division amongst the classes. If know one thinks that that's a problem, well then what's the problem with you guys trashing anyone on this forum?


December 12, 2008 4:03 PM

If Madoff is/was a dues paying member of FINRA and SIPC, isn't there some recourse from those organizations in the event of fraud? Or was he scamming them as well? I have to say that I admire the skills of a good crook - of course I didn't have any money with him, or I might have been headed to the sports store for a Slugger.

John M.

December 12, 2008 4:12 PM

I know a whole family that was vested with him. I myself had my roth ira invested with the company. The family even knew him personally. Its really depressing and annoying that other people take joy is other people's plight.
I'm under 30 with 5000 in the bank.
I can start over, not many other people can.
A whole family probably just lost every dime they had the children, parents and grandparents.

Howard S

December 12, 2008 4:43 PM

The website of Mr. Madoff's 'company' is still up, at least it was a half hour ago. On the home page is a button indicating that Madoff's firm is a member of SIPC.
If this is true (or if anything on Madoff's site is true, save for the web address), does this mean that SIPC - i.e. we taxpayers - will be stuck with making good on the seventeen to fifty billion dollars that has evidently just been flushed down Madoff's drain?
Anyone know?

Mike Landon

December 12, 2008 4:51 PM


It is sweet justice when the filthy-rich that have been the ones to profit from the financial markets get fleeced just like the rest of us.

EASY come, EASY GO. How stupid do you have to be to put all your eggs in one opaque, unregulated basket??


p.s.. The Ramen noodles are in isle 7!


December 12, 2008 4:59 PM

The taxpayers better not have to pay for one thin dime of this fraud.

Im sorry, but it's about time rich people take it in the shorts. It's called KARMA.


December 12, 2008 5:24 PM


Can you imagine being worth 20 million one day when you go to bed, and then you wake up and ITS ALL GONE??!!!

All over, but the cryin'!!

Absolute power corrupts Absolutely.


December 12, 2008 5:31 PM

What is happening now has no precedent. Just remember when the lights go on and you see a cockroach, there is never just ONE!

If the ex-Nasdaq chairman would do something like this, think how many others there likely are.

SO glad I was never "exclusive" enough to belong to that greedy club. What a bunch of crooks.

Best of luck to all-


December 12, 2008 5:41 PM

John M--

Get used to hearing the anger and rage. It is very much justified at this point, if you ask me.

Your average middle class citizens are working their a$$'s off, only to have to pay for the bad bets of the elite, time after time, as they skate free. You just can't keep kicking the majority population of this country, and lining the pockets of the wealthy without serious consequences and push back on a huge level.

Its hard to have pity for country club criminals that caused most of our financial problems in this country, when you work hard for a living, are losing your job, house, and ability to feed your family. If the tables were turned, they wouldn't give a hoot about us.

Welcome to the USSA comrades.


December 12, 2008 6:47 PM

Illiterate beaner?
Yeah right.....
I don't like beans, my father was born and raised in the USA, the next American president will have a Latino last name. The James and the Mikes and the Teds will be minorities, ohh did I say iliterate minorities who only know how to read and write in America, but don't know a word of English and Spanish?

Miguel Henriquez

December 12, 2008 8:22 PM

Sam, it is very sad when a person´s source of happiness is another human suffering. ¿how do you know everybody deserves to lose all their money? ¿and why do you think investors have not earn the money they invest? please dont generalize (as i see you dont like being generalized as a "money-grubbing jew") good and bad people can be Latinos, Jews, caucasian, asian, poor or rich, young and old, men or women so please if you are actually going to post such poor commentaries stop doing it and avoid being categorized as an idiot.


December 12, 2008 10:57 PM


If this doesn't show you how worthless Chris Cox and the SEC are, nothing will. What a riches to rags story this is! Fascinating!


December 12, 2008 11:06 PM

Why is this any different from Bear-Stearns, Lehman and AIG. They were all giant ponzi schemes?

The govt. keeps on bailing out these ponzi schemes. I rather spend my tax dollars on GM, Ford and Chrysler - at least they make real products and employ real people.


December 12, 2008 11:36 PM

Don't close GITMO just yet. Between Congress, the FED, Wall Street and the Bush Administration, We can fill the place to over-flowing!!

Bring on the jail sentences!


December 12, 2008 11:38 PM

my 9 yr old goes to school with bernies grand daughter!!! they were best friends

Murali. K.R.

December 13, 2008 12:17 AM

Sitting in India and reading all these commets was interesting! We do not have these big financial offenders like you have in the US..we have politicians! But the differnece is that they take money from the wealthy industrialist and pass on some fraction to the poor..especially in the election time.

ted g.

December 13, 2008 12:26 AM

Gordon Kecko(AKA: Michael Douglas) said it all the movie, Wall Street: "greed is good." Don't worry, all those greedy Wall Street bankers/investors/mortgage broker will get their comeuppance when the prison door clanks shut on them. I have no sympathy for any of them.


December 13, 2008 1:28 AM


Please do a bit of research before you start your complaints. The $30 billion in question was related to the portfolio of mortgage securities the Federal Reserve backstopped from JP Morgan. BlackRock is the asset manager on behalf of the government's "investment." The state of Florida transferred one of their portfolios to BlackRock to manage as well.

Robert Smithfield

December 13, 2008 2:35 AM

It is absolutely mandatory that the U.S. Gov't bail out all Madoff investors 100%!

NOT to do so sends a fatal signal to all international fiduciaries & investors that:

1. The USA's financial system is totally untrustworthy & broken, we here in the USA in any fiduciary position are ALL crooks. [A PR & practical nightmare to our capital markets.]

2. USA's Wall Street is the "Wild West," and you international investors take ya chances in investing with our financial institutions at all levels.

3. The USA will NOT insure nor enforce the integrity of any of its highly regulated financial markets or entities.


December 13, 2008 8:03 AM

THEFT not TARP.. Terrible Heist Effected From Treasury. It is simply money sent to the thieves to cover up an even greater Ponzi scheme.

Stocks are counterfeited with the marketmaker exemption and these fail to deliver.

Bonds are duplicated with no assets behind them and sold.

After stuffing the market with worthless paper, the bond packagers ran out of suckers and there was no market. Goldman and Deutschbank were prime perps according to Michael Lewis. Listen to what Max Keiser says about the bond market. In 1999 HUD was short collateral of 59 billion dollars. Whistleblower was shutdown.

Without AIG's worthless guarantee of Credit Default Swaps, the whole thing would be exposed.. so the Fed is pumping money to AIG to keep it all covered up. It is just a matter of time before someone looks at the stinking mess under the TARP. How many counterfeit MBS did they issue? If the worthless bonds can be hidden away, will the criminals ever have to face the consequences?


December 13, 2008 12:25 PM

another testament to an individual's insatiable desire for more of everything... to the detriment of his fellow man...

this asshat should have done the right thing... put the loaded 45 in his mouth and pulled the trigger... he basically did that to his customers.


December 13, 2008 12:28 PM

The SIPC web site states Madoff is a member too. I do not understand why the press hasn't picked up on this. If you had $25m invested then $500k is a drop in the bucket, but what if a 'poor guy' only had $400k invested?


December 13, 2008 3:27 PM

Can anyone with legal knowledge please comment on the SIPC coverage??? IT WASN'T only the rich that got conned by this guy. There were plenty of older people who had their whole life savings invested here and got in at the beginning when there was a much lower minimum 5k. Families are really hurting here, not just the ones you see on the news and celebs.


December 13, 2008 8:53 PM

Why do some people assume all the victims are rich? My parents worked regular jobs (engineer, bookkeeper), saved, put five kids through college, were fortunate enough to make some money when they the house in which we were raised, and just lost a big chunk of their retirement income. They played by the rules: my father - son of poor Russian immigrants - studied at night so he wouldn't disturb his two sisters, with whom he shared a room in the family's two-bedroom apartment. After graduating, he worked long hours for Grumman Aerospace, earning a Masters part-time evenings to advance his career. Neither of my parents were born to affluence, and they aren't rich now. And some people want to dance on their financial graves?

Matthew Tuttle Benjamin

December 14, 2008 3:11 AM

"Insurance" for investment fraud does not exist in the U.S.


December 14, 2008 8:53 AM

The stench of ethnic slander detracts from the efficacy of such a source's expression...and in such a non-place as this is de-gratifying.
It takes a village to re-learn the credo that IF IT QUACKS TOO GOOD TO BE TRUE IT MUST BE A DUCK...
The victims of this make-more-$ with Bernie scheme deserve no more nor any less concern...least of all recompense...than any "player" buying into such an "edge"...If it smells like fish...don't make it Sushi...

joseph t

December 14, 2008 9:32 PM

Can someone give me some advice? My retirement is in Blackrock's money market portfolio. Am I in trouble?


December 15, 2008 3:47 AM

Consumerist capitalism and the runaway schemes that fuel it is predatory and destructive. This inherent flaws make it unsustainable. There is some serious re-thinking to do.

Perpetual Bull

December 15, 2008 4:31 AM

The SIPC (brokerage insurance) issue is very significant and quite scary here. According to 2007 year end financials, the SIPC only has $1.5 billion assets + $1 billion Treasury money + $1 billion bank credit meaning they can sustain $3.5 billion in insurance claims. This fraud is so big that it runs the risk of depleting SIPC, which would render insurance at all other American brokerages nearly worthless.


December 15, 2008 11:42 AM

SIPC will not pay a dime if fraud is involved.


December 15, 2008 2:52 PM

I think there are other potential scams to surface with this down turn. For example any tightly run investment funds that are controlled privately and with family members, i.e, does anyone have money invested with *****?? I would start pulling my money out of there now if you do.

Roy Bean

December 15, 2008 3:08 PM

Ii seriously believe that we need to reinstitute public hangings for fraud on Wall Street. What a joy it would be to see some $750.00 pairs of loafers kicking in the breeze. By the way, where did the money to post. Ail come from if the company is insolvent by fraud?

Roy Bean

December 15, 2008 3:35 PM

Ii seriously believe that we need to reinstitute public hangings for fraud on Wall Street. What a joy it would be to see some $750.00 pairs of loafers kicking in the breeze. By the way, where did the money to post. Ail come from if the company is insolvent by fraud?

Roy Bean

December 15, 2008 3:44 PM

Post bail


December 16, 2008 9:08 AM

We dont make anything in the US.
All we have is suits dreaming up schemes
to rip people off.
Give the Engineers and Scientist the power !!!
They love to create and build stuff.


December 16, 2008 9:12 AM

'I have to say that I admire the skills of a good crook', that's the comment from Dave. There are too many people like Dave in power.
What has happened to our society?
The powerful do not fear punishment, and their hubris is disgusting.
All of this just for more money?
Where does it stop?


December 17, 2008 12:23 AM

I don't believe that anyone who lost on this scheme should be bailed out.
I am a working class guy and when I see interest rates that are much higher than the norm, I avoid them. Higher interest rates usually spells higher risk. You took the risk.

It just goes to show that Capitalism doesn't work!


December 17, 2008 8:39 PM

Uncle Bernie and the Greedy

Bernie was very selective in that he only took money from people that had too much and could easily survive without the paltry sum they gave him to invest.

Remember that he routinely turned down direct investments from those that he met at the clubs - the poor wannabes that he knew could not take the hit. He did stick it to the rich who in their hearts had to know that he was doing something illegal.
His victims cannot get over the fact that it was them that were being screwed.
We need to see if we can recover all the money that was paid to this group of leaches since this money was part of the scheme.
Why did the SEC not find out until he told them? Fat, lazy government workers tied into the in-crowd.

The taxpayers have no reason or requirement or need for bailing out the greedy investors. Let’em rot. The USA will do fine without them.


December 18, 2008 3:03 PM

"Madoff received a wave of redemption notices in recent months, from investors looking to preserve cash. Authorities say investors sought to pull-out some $7 billion" I don't understand why all the redemption requests. Wasn't he actually showing gains during this crisis? Maybe it shows how panicked investors are.

skull H

January 6, 2009 2:43 PM

Wall street's new name> PONZI STREET be careful all you gamblers//// all the losers should pool together and send that "45" to his apartment ...... just here to help

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