ATTENTION!! A fanatical free marketeer had gone rogue! If only we didn't have so much regulation and oversight of American commerce, this never would have happened.

Good Lord, can't you liberals see what you're doing?! Why, you've driven this poor man to madness!

Free Bernie Madoff and put Pelosi and Reid in jail!!

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1986 300SDL, 362K
1984 300D, 138K

A fraud, a cheat, a liar, a crook. A creep who took advantage of people. He "worked" in a somewhat free market and preyed on others.

He should have done like Rom Emmanual, Chris Dodd, and Barney Franks did for their pals and merely give the taxpayers' future earnings to incompetent quasi-governmental entities to be disbursed to their cronies.

The problem lies in who you punish and for what. Do you hinder a marketplace with excessive controls that limit all of us to keep people like this inline? OR Do you punish, severely, the people like Madoff and leave the rest alone? I think tossing his sorry butt into a sack with 4 nice fat Texas rattlesnakes would be a great solution. Or how about a public, on the net, "info list" of where these guys live, their daily routines, etc. A little vigilante justice would take care of it quickly. Its a tough call. RT

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When all else fails, vote from the rooftops!
84' Mercedes Benz 300D Anthracite/black, 171K
03' Volkswagen Jetta TDI blue/black, 93K
93' Chevrolet C2500HD ExCab 6.5TD, Two-tone blue, 252K

Put Madoff In Charge of Social Security

By HOLMAN W. JENKINS, JR.
Article

Where was the SEC? Such is the plaint lofted in the wake of the Bernie Madoff scandal.

Huh?

When has the Securities and Exchange Commission ever found a fraud except by reading about it in the newspapers? Anyway, who said the agency was supposed to prevent investors from losing money or relieve them of having to perform due diligence?
Mr. Madoff's many honorable and accomplished clients chose to deal with their man outside the institutional checks that come from, say, a heavily regulated bank or a highly transparent mutual fund, perhaps one whose parent is also publicly traded and doubly subject to the checks of a watchful stock market. That was their choice.

It is common to wax nostalgic for a time when a man's word was his bond, business was done on a handshake, etc. This is poppycock. It has always been a client's job to sort out the dealer who could be trusted from the one who couldn't. Personal connections may give comfort, but are no substitute for true institutional checks or true experience of a man's character, which many of Mr. Madoff's clients seemed not to have.

Instead, they went on "reputation," which is to say they acquired their faith in Mr. Madoff more or less the way people acquire their faith in global warming and many other things, from people equally as ignorant as they.
What makes the Madoff story interesting, though not evidence of systematic failure of the regulatory or legal system, is that Mr. Madoff and some of his clients had dealt on a basis of trust for more than a generation. True Ponzi schemes, in which early investors are paid a "return" out of funds deposited by later investors, tend to falter at the first market downturn. Waning investor enthusiasm dries up new funds required to pay off earlier investors. The scheme collapses.

In all likelihood, Mr. Madoff was not running a pure Ponzi scheme, but had real assets. He was operating a blind pool, in which investors had no real idea what they owned or how it was performing, relying on Mr. Madoff who reported metronomic returns, brooked no nosiness into his methods, and seemed always willing to pay off investors who wanted to withdraw their money.

He may have been casual from the start about what money he used to pay withdrawals. It is almost inconceivable, though, that he could have built a true Ponzi scheme to a height of $50 billion, in which there were never any real assets, just his superhuman 40-year juggling act to ensure new investors were recruited as needed to provide funds to meet withdrawal requests from earlier investors.

If so, he is a genius who should immediately be put in charge of the Social Security and Medicare trust funds.

It was Mr. Madoff himself who apparently applied the word "Ponzi" to his crime, in his distraught confession to his sons. His "$50 billion" in reputed losses also appear to be little more than hearsay, his own tremulous characterization of the long-running disaster he'd wrought.

More likely, his firm devolved into a Ponzi scheme only when serious losses hit and he decided not to level with investors but to gamble on a resurrection. The hoped-for rebound, as they frequently do, failed to materialize. His losses grew. Then came a flood of redemption requests amid the current credit crisis. Mr. Madoff's jig was up.

His decision-making at this crossroads probably wasn't helped by the fact that, in the early 2000s, just as the long bull run was ending, the press began asking questions about the improbable consistency of his reported returns -- making it an awkward moment to stop reporting consistent returns.

Conscious of his standing in the community and seeing jail beckoning, all he could think to do was double down.

There are costs and benefits to everything, including the cumbersome apparatus of firms that subject themselves to intrusive monitoring and conform to standards of transparency. Mr. Madoff's clients chose to avoid those costs. For that matter, they chose to forgo lower but safer returns, as many rich people do, by entrusting their fortunes to T-bills.
The herding automatons of the media can never encounter lawbreaking in the financial markets without concluding that it demonstrates the necessity of more laws against lawbreaking. Congress, now in the process of convincing itself it should run the auto industry, no doubt will see in Mr. Madoff proof that Congress is needed to manage rich people's money and ordinary people's too. Then we'll all be in the same position as Mr. Madoff's clients.

By far the best piece I've read so far on this mess. It seemed near impossible to me that he could have juggled this purely as a Ponzi scheme from start to finish, with that much money, plus paying out withdrawals and dividends regularly.

The blind faith that money makes money, just watch it go, is misplaced and much at fault here. The unwavering returns seemed too good to be true, and whattayaknow.

People need to have an actual stake, an intellectual involvement, in what their money is doing.

__________________
1986 300SDL, 362K
1984 300D, 138K

He stole a lot of money, he will be lucky if he doesn't get hit. Steal $40m from someone and they are bound to get a bit angry.

__________________
1999 SL500
1969 280SE
2023 Ram 1500
2007 Tiara 3200

He is no doubt high on the list of 'most hated people' at this time.

The theft is bad enough but he has also dealt a severe hit to US credibility at exactly the wrong time. Some foreign banks and investors have lost huge amounts.

__________________
1986 300SDL, 362K
1984 300D, 138K

I Knew Bernie Madoff Was Cheating, That's Why I Invested with Him
Posted Dec 12, 2008 12:45pm EST by Henry Blodget in Investing,

Interesting tidbits coming in about Bernie Madoff (read indictment here).Specifically, we're hearing that the smart money KNEW Bernie had to be cheating, because the returns he was generating were impossibly good. Many Wall Streeters suspected the wrong rigged game, though: They thought it was insider trading, not a Ponzi scheme. And here's the best part: That's why they invested with him.

http://finance.yahoo.com/tech-ticker/article/145115/I-Knew-Bernie-Madoff-Was-Cheating--That%27s-Why-I-Invested-with-Him?tickers=^dji,&gspc,^ixic

__________________
1985 300D Turbo
"Evolution is God's way of giving upgrades" Francis Collins

How's that old saying go, about being undone by greed?

__________________
1986 300SDL, 362K
1984 300D, 138K

From today's WSJ

The Madoff Inheritance
By DANIEL HENNINGER
Article

The office of Voysey and Son is in the best part of Lincoln's Inn. Its paneled rooms give out a sense of grandmotherly comfort and security, very grateful at first to the hesitating investor . . .
-- From "The Voysey Inheritance," a play by Harley Granville-Barker, 1914.

No one reading this newspaper has to be told there is nothing new under the sun, especially in the world's other oldest profession -- separating people from their money.

A penny for your thoughts.
Déjà vu of a specific criminal sort overwhelmed me Friday morning in the first sentence of the Journal's story about the talented Mr. Madoff. It said the esteemed investor was arrested "after his sons turned him in for running what they said their father called 'a giant Ponzi scheme.'"

Even at $50 billion, Ponzi schemes are a dime a dozen. A friend says he knew a fellow who specialized in sniffing out Ponzi schemes, so he could be the first one into the pot and then the first to ask for his winnings before the posse arrived.

I blinked, though, at seeing that Madoff's own sons turned him in. Early last year I sat in the off-Broadway Atlantic Theater in lower Manhattan and watched that same story unfold in "The Voysey Inheritance," a 1914 British play by Harley Granville-Barker as adapted by David Mamet, who with actor William H. Macy founded the Atlantic. It figures. David Mamet and Tom Wolfe are about the only serious writers in our time who see literature in the mechanics of money.

Mr. Voysey is an investment adviser in Edwardian England. He invests money for wealthy Londoners but also for the vicar of his church. His partner in the business is his son, Edward, an innocent who discovers in the ledgers that his father is a crook.

The scene in which Edward confronts his father over a life fleecing friends and clients is compelling, a torrent of talk about investment vehicles, mortgages, bonds, wealth, moral dilemmas, trust, friendship and principle.

This performance was in January 2007, at the height of Wall Street's grandest days. I thought that in a moderately better world every investment banker, hedge-fund guy and Hamptons aspirant would see "The Voysey Inheritance." Its message: Gentlemen, please get a grip.

The fascinating thing about the Madoff affair is no one's talking. How come? From Palm Beach to Geneva, Madrid, Greenwich and the Hollywood hills, nary a peep of reflection or insight. What were they thinking?

Conversations have occurred between sons Mark and Andrew and their father Bernard. What was said?

"Voysey" offers an answer.

Edward to his father: "There are no funds in these accounts. In the accounts we manage. How long has it been going on?"

Mr. Voysey: "I'm sorry to involve you in it."

Edward: "Involve me? I'm your partner. You, we have defrauded everyone who has trusted us . . . D'you mean to tell me that this sort of thing has been going on for years? For more than thirty years!"

Mr. Voysey: "We do what we must in this world, Edward. I have done what I had to do."

There are two versions of "The Voysey Inheritance" available -- Mr. Mamet's adaptation from Vintage and Harley Granville-Baker's longer original scanned into Google Books. Both are transfixing reads against the unfolding backdrop of the incredible Madoff revelations.

There is this obvious question: Across all the years of wondrous returns from this Wizard of Oz, didn't a small cloud of question pass through the mind of, say Jeffrey Katzenberg or Steven Spielberg or Carl Shapiro to ask, How is he doing this?

One answer emerges from the Voysey drama when Edward tells wealthy family friend George Booth and Vicar Colpus that he plans to admit the fraud and face justice (Mr. Voysey having conveniently died). They try to talk him out of it. They want Edward to continue the scheme. For them, at least, the scheme seems to work. They want to believe it can still work. Edward demurs, and they are outraged that he will not continue business as usual.

Booth: "Your father would never have acted in this way."

Edward: "My father was a thief. . . ."

Booth: "Edward? I've offered you salvation. Salvation!"

Edward: "I thought we were talking about money."

A big lesson of the past year is that we all should be talking more about money. One reason we don't talk about money is we are afraid of what we might learn. Mr. Madoff's contented investors are hardly different from the apparently uncountable number of people who put down 5% for a large mortgage without wondering, How does this work?
It's so nice Congress and Sheila Bair want to bail out these poor souls who knew so little about borrowing. Bernard Madoff's victims will get no such succor, even the most deserving.

Though living in an era of fantastic money tales, it is remarkable how little serious literature is written about money in business or money in politics. In fiction or drama characters can be made to say truths real people would never tell a journalist.

"The Voysey Inheritance" should be on Broadway or on television. Why? To learn a few things about money that we manifestly do not wish to know. Edward: "It's strange the number of people who believe you can do right by means which they know to be wrong."

HAHAHAHAHA Another "nice guy" goin' down.
DAY-aam, this dude's in DEEP doo-doo.
Wonder if he's got malpractice insurance? Not that they won't balk at paying, even if he does.

Madoff's auditor... doesn't audit?

The three-person firm that apparently certified Madoff's books has been telling a key accounting industry group for years that it doesn't conduct audits.

By Alyssa Abkowitz
Last Updated: December 18, 2008: 8:17 AM ET




(Fortune) -- The three-person auditing firm that apparently certified the books of Bernard Madoff Investment Securities, the shuttered home of an alleged multibillion-dollar Ponzi scheme, is drawing new scrutiny.

Already under investigation by local prosecutors for its potential role in the scandal, the firm, Friehling & Horowitz, is now also being investigated by the American Institute of Certified Public Accountants, the prestigious body that sets U.S. auditing standards for private companies.

The problem: The auditing firm has been telling the AICPA for 15 years that it doesn't conduct audits.

The AICPA, which has more than 350,000 individual members, monitors most firms that audit private companies. (Public-company auditors are overseen, as the name suggests, by the Public Company Accounting Oversight Board, which was created in 2003 in response to accounting scandals involving WorldCom and Enron.)

Some 33,000 firms enroll in the AICPA's peer review program, in which experienced auditors assess each firm's audit quality every year. Forty-four states require accountants to undergo reviews to maintain their licenses to practice.(correction: it's every three years.)

Friehling & Horowitz is enrolled in the program but hasn't submitted to a review since 1993, says AICPA spokesman Bill Roberts. That's because the firm has been informing the AICPA -- every year, in writing -- for 15 years that it doesn't perform audits.

Meanwhile, Friehling & Horowitz has reportedly done just that for Madoff. For example, the firm's name and signature appears on the "statement of financial condition" for Madoff Securities dated Oct. 31, 2006. "The plain fact is that this group hasn't submitted for peer review and appears to have done an audit," Roberts says. AICPA has now launched an "ethics investigation," he says.

As it happens, New York is one of only six states that does not require accounting firms to be peer-reviewed.
But on the heels of the Madoff revelations, on Tuesday, the New York State senate passed legislation that requires such a process. (The bill now awaits Gov. David Paterson's signature.) "We've not been regulated in the fashion we should've inside the state," says David Moynihan, president-elect of the New York State Society of Certified Public Accountants.DUH

David Friehling, the only active accountant at Friehling & Horowitz, according to the AICPA, might seem like an odd person to flout the institute's rules. He has been active in affiliated groups: Friehling is the immediate past president of the Rockland County chapter of the New York State Society of Certified Public Accountants and sits on the chapter's executive board.

Friehling, who didn't return calls seeking comment, is rarely seen at his office, according to press reports. The 49-year-old, whose firm is based 30 miles north of Manhattan in New City, N.Y., operates out of a 13-by-18-foot office in a small plaza.

A woman who works nearby told Bloomberg News that a man who dresses casually and drives a Lexus appears periodically at Friehling & Horowitz's office for about 10 to 15 minutes at a stretch and then leaves. (State automobile records indicate that Friehling owns a Lexus RX.) The Rockland County District Attorney's Office has opened an investigation to see if the firm committed any state crimes.

People who know Friehling, through the state accounting chapter and through the Jewish Community Center in Rockland County (where he's a board member) were reluctant to discuss him. Most members of both boards wouldn't comment except to say they were surprised by Friehling's connection to Madoff.

"He's nothing but the nicest guy in the world," says David Kirschtel, chief executive of JCC Rockland. "I've never had any negative dealings with him."

I think the phrase you were looking for was "There's no honor among thieves."

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M. G. Burg
'10 - Dakota SXT - Daily Ride / ≈ 172.5K
.'76 - 450SLC - 107.024.12 / < .89.20 K
..'77 - 280E - 123.033.12 / > 128.20 K
...'67 - El Camino - 283ci / > 207.00 K
....'75 - Yamaha - 650XS / < 21.00 K
.....'87 - G20 Sportvan / > 206.00 K
......'85 - 4WINNS 160 I.O. / 140hp
.......'74 - Honda CT70 / Real 125
.
“I didn’t really say everything I said.”
. . . . . . . . . . . . . . . . . . ~ Yogi Berra ~

And John Wayne Gacy would be a clown at kiddie parties...

__________________

M. G. Burg
'10 - Dakota SXT - Daily Ride / ≈ 172.5K
.'76 - 450SLC - 107.024.12 / < .89.20 K
..'77 - 280E - 123.033.12 / > 128.20 K
...'67 - El Camino - 283ci / > 207.00 K
....'75 - Yamaha - 650XS / < 21.00 K
.....'87 - G20 Sportvan / > 206.00 K
......'85 - 4WINNS 160 I.O. / 140hp
.......'74 - Honda CT70 / Real 125
.
“I didn’t really say everything I said.”
. . . . . . . . . . . . . . . . . . ~ Yogi Berra ~

Some say he may want to take a lenghty vacation in Israel ...

He must have been greasing a lot of people who worked with him to pull this off. NFW can one guy pull this off for some many years without help.

__________________
1999 SL500
1969 280SE
2023 Ram 1500
2007 Tiara 3200