Nobody screams when times are good - or at least looking good on paper for those in Madoff's Ponzie scheme. Bet his clients were "thrilled to see" consistent returns on their statements despite market fluctuations. I'll also bet most of them were counting on it never ending, too. The upside for Madoff, and the corresponding downside for investors, is never cashing out for fear of losing all those gains. Ya think!

White collar crime pays - and pays very well. Dante has a Bolgia in the Eighth Circle of Hades for the greedy and the deliberately fraudulent, but here in the real world they just get to leave a lot of human flotsam and jetsam in their wake - not that these humans weren't willing participants to some degree. It really isn't like me, but I'm running low on "sorry".

"As long as people make large returns,they don't question anything..But when the bottom falls out,it is everyone;s fault but their own..This is true in housing and investing.."

Everyone's fault? How about those people who DIDN'T invest in the market? How do you think they feel about getting ZERO returns on T-bills while corrupt, fatcat Wall Street *astards use taxpayer subsidized free bailout money to go on lavish retreats and buy up OTHER banks instead of using the money like they were SUPPOSED to.

What about the responsible folks who didn't get subprime loans but are having to watch the value of their homes plummet anyway?

If the all-so-astute mortgage lenders had followed the rules of actually VERIFYING income, credit worthiness, etc., they would NEVER have given people money for houses they couldn't afford.

You can blab all you want about those folks who accepted loans they knew they wouldn't be able to repay, but what excuse do the almight 'financial pros' have? NONE. They cannot be accused of being 'unsophisticated'. If THEY were going to be the ones stuck with the hot potato, they would have never let this happen.

In 2001, a senior Treasury official, Sheila C. Bair, tried to persuade subprime lenders to adopt a code of âÂÂbest practicesâ and to let outside monitors verify their compliance. None of the lenders would agree to the monitors, and many rejected the code itself. Even those who did adopt those practices, Ms. Bair recalled recently, soon let them slip. And leaders of a housing advocacy group in California, meeting with Mr. Greenspan in 2004, warned that deception was increasing and unscrupulous practices were spreading. If the Fed had done its job, we would not have had the abusive lending and we would not have a foreclosure crisis in virtually every community across America.

Considering the economic havoc these players have caused, I'm sorry we don't have public hangings for the people like this.

What i find funny is the fact i DO find fault with financial institutions/banks/Wall Street,BUT also find fault with consumers.People like yourself(Dreamgarden) and others blame everyone but those who signed for toxic loans,pourchased homes they knowingly couldn't afford,or invested in financial products that were generating abnormal returns,without EVER questioning how that was possible...We don't need Big Brother protecting us fom ourselves,if you want that i'll pay for your fare to Cuba or Russia

NY Newspaper:

Novice investors trusted his reputation. Sophisticated clients figured he had an angle.

Either way, as long as Bernard Madoff delivered big returns, investors didn't ask questions. "I hate computers, and I never tried to figure out what he was doing because the bookkeeping all added up," said Joyce Greenberg, a philanthropist and retired financial adviser in Texas.

Susan Leavitt, of Tampa, said she had millions invested with Madoff.

"I expect to get back zero," Leavitt said. "When he tells the feds he has $200 million to $300 million left out of billions, what can you expect?" Madoff was such a big shot that billionaires, endowments and even hedge funds invested in his portfolio. Ezra Merkin, chairman of GMAC Financial Services, served with Madoff on Yeshiva University's board of trustees. Merkin, who also runs a hedge fund called Ascot Partners, told his investors Friday that "substantially all" of Ascot's assets had been invested with Madoff.

"I am shocked, as I know you are, by this fraud," Merkin wrote. "As one of the largest investors in our fund, I have also suffered major losses from this catastrophe." Analyst Henry Blodget wrote on his blog Friday that some savvy investors figured Madoff was up to something because his returns were so high.

"Many Wall Streeters suspected the wrong rigged game, though: they thought it was insider trading, not a Ponzi scheme," Blodget wrote. "And here's the best part: That's why they invested with him." Madoff issued sparse paper reports to his investors, claimed his portfolio only lost money in five of the last 156 months and used an obscure accounting firm in Rockland County as his auditor.

More questions earlier might have saved people money, but it is doubtful they would have elicited meaningful answers.

When Barron's asked Madoff in May 2001, how he engineered such consistent double-digit returns, the man who once ran the Nasdaq was tight-lipped.

"It's a proprietary strategy," he said. "I can't go into it in great detail."

Yep, poor investors who were blindly fleeced ;)

Like qdognj, I also find much fault with banks and Wall St., etc. But there's enough fault on mainstreet to add to the misery, too.

These types of discussions should not presuppose that, although it's not expressly stated in each response to a post, some of us are not mindfull there are those who were actually duped; who were led down a risky path and didn't anticipate or take the time to educate themselves on the consequence of risk; who through no fault of their own were victimized; who were diligent but suffered an unexpected crisis. It can't be denied, however, that there is some consumer complicity in this. People who knew and didn't care as long as they got theirs. Ubi est mea.

What strikes me about Madoff, Wall St., et al is that they do the kinds of things they do simply because they can. There's no oversight and until now no groundswell of national will to demand oversight. Our elected officials bailed out AIG, etc. and did nothing beyond "hope" all that money wouldn't go down a black hole. Surprise!

The financial pros - including an ideologue like Greenspan - sat back. I refuse to accept they were taken by surprise by any of this. They chose to obfuscate, deny, and spin to buy time on the odd chance it would go away all by itself.

others saw it,the improbable returns and questionable strategies

Here is a link that might be useful: Note from Hedge fund about Madoff

Andrew and Mark Madoff had long worked in the share-trading part of their father's business, but he kept his asset-management activities separate and secret, with books kept under lock and key, and investment returns audited by a backwoods firm rather than one of the major accounting names.

LOVE the line "backwoods firm rather then one of the major accounting firms"...hmmmmm, i wonder why ;)

Madoff is just one symptom in the overall malaise. He shopped around to find an accounting firm that fit - leaning towards the hear, speak and see no evil even if they were collectively bright enough to uncover something. Believing they'd get paid for their services, Madoff would have been a died and gone to heaven client.

Speaking of risk/no risk tolerances; my friends used to snicker at my fondness for treasuries as a safe place to park excess funds. In addition to other investments - some of which have taken a degree of pounding, I've been laddering treasuries since the mid 90's. Over the years, the rates have been good, sometimes not so good or downright bad, but I haven't lost a dime in principle. My friends aren't snickering now.

Experts are baffled that investors and regulators did not wise up to the ruse sooner.

"I'm shocked investors turned a blind eye to returns that were too good to be true, constant, steady, small, positive returns," said Jim Vos, of the hedge-fund consulting firm Aksia LLC.

But Madoff apparently made them an offer that was too good to be scrutinized.

Madoff was single-handedly managing billions of dollars in offices he kept separate from the rest of his firm, said Vos, who steered clients away from the fund.

The only oversight was conducted in a Rockland County accounting office only slightly larger than a cubicle.

And Madoff, who made his fortune embracing the latest and best technology, forbade investors to get online access to their accounts, insisting instead on paper printouts.

"When something is too good to be true, it probably is," Vos said.

For well over a decade, competitors and experts said they found Madoff's track record suspicious. He seemed immune to any volatility in the market and, no matter what was happening in the economy at large, managed to finish each month with almost identical profits.

Markopolos, who worked for a Madoff competitor when he made the charge of fraud, continued to cry foul for years, to little avail.

Madoff dismissed these attacks as envy and said critics simply did not understand the complexities of his strategies.

Some 11 to 25 investors at a time, it seems, were willing to play along - at least before the economic meltdown in recent months persuaded them to pull out.

They told Madoff they wanted to liquidate their assets, not realizing Madoff had already vaporized them.

Aksia LLC was hired to investigate Madoff several years ago, said principal Jake Walthour. The probe only increased the concerns about the fund. Madoff's returns were "abnormally smooth" from month to month, and it seemed impossible to replicate his investment strategy or verify his track record.

Madoff claimed to be moving as much as $13 billion in and out of the market every month, but "no one on the street could verify it or even see his footprints," Walthour said. "That organization was incredibly secretive."

When they staked out the tiny accounting firm no one had ever heard of, investigators concluded something was amiss.

"We decided there are several scenarios here, one of which is, this could be a Ponzi scheme," Walthour said. "None of our clients invested."

Those who have invested in the fund have told investigators that withdrawing cash from it was an arduous process that involved faxes and inexplicable delays.

That's because in a Ponzi scheme, money from new investors is used to pay those seeking to withdraw their money

Keep drinking the kool-aid, investors who turn a blind eye on the shenanigans because of unusually high/constant rates of return deserve SOME blame,perhaps,lol

Can anyone here spell "self-regulation"?

How many of our professional agencies are self-regulating?

And how many people have long said that the less government interference, the better?

If I'm a homeowner following legitimate standards, how am I to ferret out the machinations of the greedy mortgage brokers who are willing to lend to people with no employment, in order to rack up a sale, with its attendant commission?

And were all of the incapable/improvident mortgage borrowers stupid people who didn't know better?

And how are we, who play by the rules, to catch the scoundrels?

The other day while speaking to an astute person quite heavily involved with investing, who likes to attend our local annual "Financial Forum", going early before things are busy, he said that an offical of an exhibitor, the "Ontario Securities Commission" asked him whether there was anything that he could do to be of service.

My friend said that, yes, there was ... how many of the financial schemers overseen by the Securities Commission over many years had ever gone to jail?

The representative said that he had no idea.

My friend said that he could give him an answer - "None".

How many of the U.S. scoundrels have seen the inside of a jail cell (apart from the high-profile ... and, somewhat less than "incidentally", I think, female, Martha Stewart)?

One of the contributing factors to the trouble that we are moving into, according to Jane Jacobs in her book, "Dark Age Ahead", is the traditional situation where many of our professional organizations are self-regulating.

We are paying the price, it seems.

We used to claim that the "Divine Right of Kings" was a false doctrine.

Similarly for the concept of the "Divine Right of Corporate Power", perhaps?

ole joyful

Yes, it is the fault of everyone involved.

The financial people knew what they were doing when they made those bad mortgages.

I do think there might have been a few, very few, who were duped. Perhaps some elderly who were convinced to refinance, etc. There is no way you can convince me people didn't realize they were doing wrong when they bought those huge homes. I'm thinking they believed someone would bail them out or they could flip these houses before the music stopped.

What can we do to bring them to justice, not much. We elected politicians to make laws and to see they are enforced. How do you bring those miscreants to justice when our politicians, President included, were going to meetings and speaking directly to the officials of FM& FM and told them he wanted 500M loans to minorities. He wanted those loans even if they had bad credit - and he wanted the taxpayers to make down payments if they couldn't afford down payments.

I understand some lawmakers helped in the debacle as well.

With that in mind, what can we do to bring them to justice? When our watchdogs are involved in the scamming?

Personally, I intend to try to stay out of debt, and do whatever it takes, legally, to keep as much of my own money as I can.

I would like to be able to say I would vote for people with integrity to make laws and enforce them, but with the stranglehold of our two party system, we aren't often given a real choice.

This country is headed for third world status as sure as there is going to be day light in the morning. First it is useless to try and tell people the damage buying imports does to our economy. People damn Wal Mart, however when they need a set of tires and Wal Mart offers a set $50 cheaper than anyone else they buy at Wal Mart. The Chinese are helping our enemies in any manner they can, weapons, cash, techinical information, yet we buy Chinese made stuff like lumber jacks buy flap jacks. We are fed the pie in sky line about a global economy and free trade, meanwhile our way of life is slowly going down the tubes.

You pay $50 more for your same tires at Jims tires, and then you don't spend $50 out to eat a dinner that day like the Wal Mart buyer could. Which is worse? Whether the money goes to Jim's tires, or Tina the waitress its all the same - cheap goods allow for us to spend on more - the basis of our service economy. If everyone bought at Jims, then we would all have less money. People would be laid off somewhere. The Chinese export the goods, but they also get to keep the pollution that goes with making goods cheap. Trust me, they can't keep it up forever - their people will eventually demand more. Then we will have the upper hand with food exports. Third world - I think not...

,If Jim goes out of business and is out of work or is working for lower wages, then Jim becomes a 'user' rather than a contributor. Jim is quite possibly going to need social services of one kind or another. Also, Jim will no longer be paying as much taxes, contributing to the community, the charities, etc. That is a hidden cost no one mentions.

If Jim is selling quality merchandise, then it is better all the way around to purchase good merchandise and forego one dinner with Tina, as they will be saving enough in the long run to have dinner with Tina more than once.

Somehow, I don't think we will become the world's exporter of food. Just my thinking, but the only way that will happen is if the government subsidizes agribusiness even more.

We already import a huge amount of food in this country.

While I don't think I agree with the idea that we will be the exporters of food, if it is possible, China has thought of that already. They have the money, they loan us money. China has plenty of land, plenty of workers and there is nothing to keep them from growing and exporting food. Also, since they have all our money, there is nothing to keep them from buying up farm land, or simply purchase the agribusiness and the land, in this country, or any other.

I do agree that our desire to spend 'more' is what has caused the world economy to grow. Much of the 'more' buying of 'things' is why people are in the fix they are financially in this country. Much of that 'more' was bought on credit - via credit cards of home equity loans.

Pollution in China will eventually make its way to the US. They have already traced some of it to the Northwest. Polluting the world is not a 'good thing', just so we can have more junky Chinese geegaws.

I just can't find an upside to all of this - for this country and it's people.

I don't find an upside to this either. DH and I have been saying for several years that our country is upside-down and continues.

What started out as wanting better for our children than we had, has turned into a get it now, paylater world. A lot of the time the word "buy" isn't even mentioned.

While artists and photographers show black cotton pickers; my mom picked cotton with other members of her family. A friend of mine and I were talking today about how she and her family picked cotton. (we are white). Wanting a better life for our children didn't mean toys: video games, cell phones, personal computers, fancy cars and mansions; it meant education, and work that didn't include back breaking sore hands like picking cotton.

Greed has been the run and ruin of our country - by politicians and CEO's. That has spread to individuals using credit cards for that enjoy now mentality.