And By the Way, Where Did that $50 Billion Go? « The Washington Independent
That’s the question Yves Smith at Naked Capitalism asks about Bernie Madoff’s huge Ponzi scheme. He also raises another good point: Why didn’t Madoff make a run for it?
From Smith:
“„If $50 billion really went poof in Bernie Madoff’s self-described Ponzi scheme, where did the proceeds go? This has to top what any dictator ever siphoned out of a banana republic. (Note that the Journal suggests that at least $17 billion has disappeared, so inflation adjusted, the Perons may be ahead). The story also suggests he was merely a very bad trader and merely lost the money.
“„In the case of other Wall Street operations that are now toast, the losses were the result of very big losses on positions and overpaying themselves bonuses in years that appeared to be good, but if the profits had been risk adjusted, were not so hot.
“„But a Ponzi scheme is all about fraud, all about taking as much out for yourself as possible (well, that is also the name of the game on Wall Street generally, but the rent-seeking is presumed to be on the back of an underlying legitimate activity) So where did the dough go?
“„And Madoff had to know this would blow up. Wonder why he didn’t flee to Panama.
More questions to look into today, as the biggest fraud in Wall Street history continues unraveling.
