Monday, December 15, 2008

"Time To Be Fleeced"

Unless Chris Cox has a good explanation for why the SEC missed Bernie Madoff, he should resign immediately. Enough is enough, right? My nomination to replace him would be "Lee." Read this article from mid-October about the Fairfield Greenwich Group, which according to its website had $7.5 billion -- over half of the firm's total client assets -- invested with Madoff. Scroll down to the comment section and read the post by "Lee" on October 20th. Maybe the call of the year...


Blogger Tony said...

Great find.

I especially like the Fairfield Group's website:

Fugg us, indeed.

12/15/2008 12:27 AM  
Blogger John said...

Interesting in a couple of ways --

1. Fairfield Group, and "Funds of Funds" in general, are just parasites on parasites.

2. How the heck was FGG losing money faster than everyone else? They should have been cushioned by the Madoff Ponzi scheme, at least until the last minute.

All scum, all the time. Just what the market ordered.

12/15/2008 1:36 AM  
Anonymous Anonymous said...

Even better is the response to LEE by Greg B.

I'd swear it was Ben Stein posting under an alias.

12/15/2008 3:30 AM  
Anonymous Anonymous said...

The last 16 years of "investing" has largerly been a series of ponzi scams.

"click-throughs" "house prices never go down" There was a mass delusion believing that nonsense, of course no one questioned Madoff.


12/15/2008 7:38 AM  
Blogger Mrs Panstreppon said...

Off topic but I haven't hear how publicly traded financial institutions will report treasury and federal reserve bailout info.

The other day, Bloomberg News lost its FOIA case against the Federal Reserve which successfully claimed it was entitled to keep bailout information secret.

Will the SEC permit these companies to keep information about signficant loans and changes in ownership secret?

How can an investor in the stock market make an informed decision if the financial statements omit critical financial data?

I'd sure wanted to know if the federal government had a big chunk of equity in a company I was interested i.

How can an auditing firm give a client a clean opinion without knowing the real nature of the company's financial condition?

I would think troubled companies in other industries will be clamoring to keep their financial problems a secret for the sake of the economy.

Undermining investor confidence in the stock marktets at this time doesn't sound like a swell idea but I'm not a financial genius like Bernanke and Paulsen.

I also asked this question at TPM last night but no responses yet.

12/15/2008 10:20 AM  
Anonymous Anonymous said...

Your right about Cox, but if the Bush trend continues, he'll be getting his medal and accolades soon. That'a boy Brownie. No wonder these folks think they can get away with thief. There is no downside for them.

Arianna Huffington has an interesting piece, "Will The Madoff Debacle Finally End The "Who Could Have Known?" Era?"

Who Could Have Known?

Well, Harry Markopoulos, for one. In 1999, after researching Madoff's methods, Markopolos wrote a letter to the SEC saying, "Madoff Securities is the world's largest Ponzi Scheme." He pursued his claims with the feds for the next nine years, with little result.

On the news they said Madoff's niece, a compliance attorney at his firm, married a high-ranking SEC official. Sounds like a lot people were complicit, especially those managing funds-of-funds.

12/16/2008 10:05 AM  
Anonymous Anonymous said...

See also the Boston Globe story How a pyramid scheme takes shape:
Regulators' response to warnings questioned
. The SEC was notified that something smelled bad nine years ago.

12/16/2008 12:56 PM  

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