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Poof! Your life’s work… December 20, 2008

Posted by gordonwatts in life, politics.
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I was reading up a bit on the Madoff Ponzi scheme. The sheer size of the money involved is just amazing! Charities totally destroyed. For example, I found the following on the Elie Wiesel Foundation’s web site:

We are deeply saddened and distressed that we, along with many others, have been the victims of what may be one of the largest investment frauds in history. We are writing to inform you that the Elie Wiesel Foundation for Humanity had $15.2 million under management with Bernard Madoff Investment Securities. This represented substantially all of the Foundation’s assets.

Poof! All their work is gone just like that. Imagine a group of people committed to some cause working for a large part of their life on it and then to have the rug pulled out from under them.

And this foundation is small potatoes compared to some of the foundations losses.

I suppose the key is trust. I trust my bank not to loose my money – or the federal government get it back to me if my bank fails. There are no such guarantees once you get beyond 100,000 or so bucks. But the way the economy was going over the past n-years there were lots of places I would have considered it was just fine to park my money that now look quite shaky.

I like Krugman’s summary of the whole mess:

Yet surely I’m not the only person to ask the obvious question: How different, really, is Mr. Madoff’s tale from the story of the investment industry as a whole?

So… how much of the boom of the last 10 or 15 years in the USA was actually fake? Even if we didn’t participate in making loads of money we certainly were a part of the USA – economically invincible [I’m going to totally ignore the war issue here]. How we have fallen! I hope it minimally affects other parts of the world, but as this Madoff mess shows, that isn’t likely.

Comments»

1. Ron - December 20, 2008

Actually, bank accounts are insured up to $250,000 through December 31, 2009, after which the $100,000 limit will be in effect again.

2. Gordon Watts - December 21, 2008

Thanks Ron, I guess I do remember reading that now. But both those numbers are so much larger than anything I have they are about the same for me.🙂

3. Mike Rowan - January 9, 2009

I am still beyond myself about this whole situation. At least my SEP wasn’t involved. Check out my article about SEP Plans, and stay away from Bernie Madoff!🙂

http://www.erollover.com/blog


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