<body><script type="text/javascript"> function setAttributeOnload(object, attribute, val) { if(window.addEventListener) { window.addEventListener('load', function(){ object[attribute] = val; }, false); } else { window.attachEvent('onload', function(){ object[attribute] = val; }); } } </script> <div id="navbar-iframe-container"></div> <script type="text/javascript" src="https://apis.google.com/js/plusone.js"></script> <script type="text/javascript"> gapi.load("gapi.iframes:gapi.iframes.style.bubble", function() { if (gapi.iframes && gapi.iframes.getContext) { gapi.iframes.getContext().openChild({ url: 'https://www.blogger.com/navbar.g?targetBlogID\x3d7621413\x26blogName\x3dmy+ramblings+%7C+expressions\x26publishMode\x3dPUBLISH_MODE_HOSTED\x26navbarType\x3dBLUE\x26layoutType\x3dCLASSIC\x26searchRoot\x3dhttp://www.ivanchoe.com/search\x26blogLocale\x3den_GB\x26v\x3d2\x26homepageUrl\x3dhttp://www.ivanchoe.com/\x26vt\x3d-4466142428700541627', where: document.getElementById("navbar-iframe-container"), id: "navbar-iframe" }); } }); </script>

My twitter Updates









I Knew Bernie Madoff Was Cheating, That's Why I Invested with Him

Sunday, December 14, 2008

Bernard Madoff, founder and president of a New York firm that invested funds for wealthy individuals, hedge funds and other institutions, was charged with securities fraud. Madoff, who told employees his $50 billion firm was a "giant Ponzi scheme,"

Here's an interesting article from Yahoo! Finance:

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.

For years and years I've heard people say that [Bernie's] investment performance was too good to be true. The returns were too steady -- like GE earnings under Welch -- and too high given the supposed strategy.

One Madoff investor, himself a legend, told me that Madoff's performance "just doesn't make sense. The numbers can't be straight." Another sophisticated Madoff investor actually went through trade confirms in order to reverse-engineer the strategy and said, "it doesn't add up."



So why did these smart and skeptical investors keep investing? They, like many Madoff investors, assumed Madoff was somehow illegally trading on information from his market-making business for their benefit. They didn't consider the possibility that he was clean on that score but running a good old-fashioned Ponzi scheme.

Looks like Madoff may have committed the largest fraud in history! Genius!

Labels: ,

posted by Ivan Choe, 8:32 pm

0 Comments:

Add a comment