I guess we'd all have to sue our FAs.
The other potential ponzi scheme I'm thinking about is Berkshire Hathaway. The stock never pays a dividend and the primary business is insurance. The performance isn't as consistent as Madoff, but the result are in theory even more impressive.
Sure Geico and General Re pays the occasional claim, and Buffett is folksy as hell.
Everyone says the stock will tank when Warren dies, but maybe it is less because of his investing prowess and more because when they audit the books, they'll find it is a giant 100+ billion ponzi scheme.
"Just because you are paranoid doesn't mean they aren't out to get you."
The latest scandal has made me think...how do I know Vanguard really exists? What if it's just a PO Box in a strip mall in Valley Forge? Sure, they send me nice statements every quarter, but it's not that hard to generate nice looking letterhead. They're audited, but so was Madoff. Vanguard has, at times, refused to take my money (closed funds) just like Madoff did to help build credibility. John Bogle is a very persuasive guy, just like Madoff was. And so far, Vanguard has always honored requests to transfer money out, but maybe one day they wake up and their $1T is gone.
I used to work in Valley Forge for another company. I wnet to school with many Vanguard employees, and by the fact that they told me that working for Vanguard sucks eggs pretty much told that they weren't actors hired by Vanguard.
CD's baby....cd's. Of course as soon as I get everything converted over, the gov't will go belly up.
I used to work in Valley Forge for another company. I wnet to school with many Vanguard employees, and by the fact that they told me that working for Vanguard sucks eggs pretty much told that they weren't actors hired by Vanguard.
Uh, you are aware that insurance companies are heavily regulated, right?
Yup. For instance AIG was heavily regulated and they only lost 100 billion, ok admittedly on one of there less regulated units.
Berkshire being a Ponzi scheme is a joke that is the point of the . But there are some similarities.... both Berkshire and Medoff were held in high regard and deliver extraordinary returns over long periods of time with large sums of money.
Actually, Berkshire is an even better Ponzi scheme than Madoff's... Think about it, Madoff paid some money out. Berkshire never ever pays anything out no dividends nothin!
Yup. For instance AIG was heavily regulated and they only lost 100 billion, ok admittedly on one of there less regulated units.
Berkshire being a Ponzi scheme is a joke that is the point of the . But there are some similarities.... both Berkshire and Medoff were held in high regard and deliver extraordinary returns over long periods of time with large sums of money.
I think what is unnerving is if you asked me (or even somebody more knowledgeable about Wall St. like yourself) could the former head of the NASDAQ stock exchange run a 50 billion Ponzi scheme, we both would have laughed and called for the tin foil hats.
I have believed that American capitalist system while far from perfect is basically a fair system. I have laughed at people who rant that the system is really rigged and run by cabal, moving around the world in Black Helicopters and called them nut cases. (albeit politely)
I'll I can say is that recent events have shaken my opinion that I am right and they are wrong. More importantly if somebody like myself who is a natural skeptic about conspiracy is seeing there faith in the system shaken, what does that say about the vast majority of folks who lack our financial sophistication?
A bit of a digression but my question is, what did Madoff do with all that money? You can't just spend $50B (or $25B, if the 50 is with expected returns). Heck, if he just stored it in a MM most of it would still exist. How badly would he have to invest it for the whole shebang to evaporate?
A bit of a digression but my question is, what did Madoff do with all that money? You can't just spend $50B (or $25B, if the 50 is with expected returns). Heck, if he just stored it in a MM most of it would still exist. How badly would he have to invest it for the whole shebang to evaporate?
A bit of a digression but my question is, what did Madoff do with all that money? You can't just spend $50B (or $25B, if the 50 is with expected returns).
A bit of a digression but my question is, what did Madoff do with all that money? You can't just spend $50B (or $25B, if the 50 is with expected returns). Heck, if he just stored it in a MM most of it would still exist. How badly would he have to invest it for the whole shebang to evaporate?
That's probably pretty close. If he has $25 billion under "management," if he gets another $5 billion he could take (maybe ) $3 billion and pay it out to the existing account holders, they think they're getting a good positive return even in a horrible market (which *should* have been a glaring red flag), where Madoff and his pals skim the rest as pure profit.I'm sure he skimmed quite a bit for himself and friends but probably most of it went out as payout to investors to keep the scheme going. Those 10 to 12 % regular annual returns were just new investors money being distributed to the old investors. To get the money back just go to the oldest investors and ask them to fork up on a progressive scale oldest to newest Good luck!
I'm sure he skimmed quite a bit for himself and friends but probably most of it went out as payout to investors to keep the scheme going. Those 10 to 12 % regular annual returns were just new investors money being distributed to the old investors. To get the money back just go to the oldest investors and ask them to fork up on a progressive scale oldest to newest Good luck!
If you can remember your experiential pleasures then you aren't doing it right...Heck, I am going to convert all my assets to "experiental pleasures", something that I will keep and cherish in my memory later, when I will be lying in the street gutter.
Good thing, too, because I hear that the SEC is going to start regulating the stock markets...Uh, you are aware that insurance companies are heavily regulated, right?
Good thing, too, because I hear that the SEC is going to start regulating the stock markets...
A bit of a digression but my question is, what did Madoff do with all that money? You can't just spend $50B (or $25B, if the 50 is with expected returns). Heck, if he just stored it in a MM most of it would still exist. How badly would he have to invest it for the whole shebang to evaporate?
If you can remember your experiential pleasures then you aren't doing it right...
Now, [-]regaining consciousness[/-] waking up and [-]starting a hangover[/-] thinking "Where the heck did THAT come from?!?"... that's probably closer to the right approach.