Said What I'd Say On Madoff Matter

goldenponderbob · 12-18-2008, 04:01 PM

I don't do much threadstarting, and have no plans to do other than mostly read what others are better at than I, but today is a rare exception.

Had I the credentials and talent to express myself on the revelations coming out of the Madoff business, I couldn't imagine doing better at summing up what we know so far, and what is hopefully about to be coming out soon.

This fellow, Jonathon Weil, from Bloomberg "nailed it" in his assessment that this is the tip of a much bigger iceberg.

Bloomberg.com: Opinion

I don't do much of this so I hope it works.

If not look it up. It contains all the elements you need to connect what Madoff was doing to the much larger AIG, from which a person could draw a line directly to the MAC/MAE's and on to the global credit freeze.

Madoff is on home detention with a monitor, and is in a perfect position to roll on the scads of "players" who will soon be looking for legal liferafts.

goldenponderbob

stolz25 · 12-18-2008, 04:05 PM

It's amazing how much press this gets when the perpetrator of a Ponzi scheme is a private individual. When the government does it with social security, no problem.

Phantom · 12-18-2008, 04:13 PM

Originally Posted by stolz25

It's amazing how much press this gets when the perpetrator of a Ponzi scheme is a private individual. When the government does it with social security, no problem.

Ya, there's no difference between the two

stolz25 · 12-18-2008, 04:17 PM

Originally Posted by Phantom

Ya, there's no difference between the two

A Ponzi scheme is a fraudulent investment operation that involves paying abnormally high returns to investors out of the money paid in by subsequent investors, rather than from the profit from any real business.

Granted, social security returns aren't abnormally high, but that's just splitting hairs. Oh, and Madoff's investors had a choice, so there's another difference.

Spideynw · 12-18-2008, 04:19 PM

Originally Posted by Phantom

Ya, there's no difference between the two

Not really. And this guy only did one for $50 billion, whereas the governments is in the trillions of dollars.

Phantom · 12-18-2008, 04:19 PM

Originally Posted by stolz25

A Ponzi scheme is a fraudulent investment operation that involves paying abnormally high returns to investors out of the money paid in by subsequent investors, rather than from the profit from any real business.

Granted, social security returns aren't abnormally high, but that's just splitting hairs.

I highlighted the important language for you. Thanks for your assistance.

stolz25 · 12-18-2008, 04:22 PM

Define Fraudulent.

Also, business is unecessary in the definition, since all it says is that a Ponzi scheme LACKS any business gains. That can certainly be said for social security.

Phantom · 12-18-2008, 04:32 PM

Originally Posted by stolz25

Define Fraudulent.

Also, business is unecessary in the definition, since all it says is that a Ponzi scheme LACKS any business gains. That can certainly be said for social security.

Are you being serious, or just obnoxious?

this isn't rocket science...

Main Entry:fraud·u·lent Pronunciation: -lənt Function:adjective Date:15th century : characterized by, based on, or done by fraud : deceitful

Social Security has some similarities with a Ponzi scheme, but there is no deceit or fraud involved. It's about as transparent as any massive program can get.

stolz25 · 12-18-2008, 04:36 PM

Originally Posted by Phantom

Are you being serious, or just obnoxious?

this isn't rocket science...

Social Security has some similarities with a Ponzi scheme, but there is no deceit or fraud involved. It's about as transparent as any massive program can get.

I'd disagree, millions of people were told if they paid into this system (involuntarily I might add) one day in the future they'd be taken care of. While so far this is true, it doesn't mean the program isn't fraudulant. Of course if you talked to Madoff's early investors they'd probably have said his program was the greatest thing ever. Social security won't be defined as fraudulant until someone doesn't get their money back from it on the guaranteed date, which will happen eventually.

WickedLou9 · 12-18-2008, 04:36 PM

THis "everything is the government's fault" is starting to get really old.

stolz25 · 12-18-2008, 04:37 PM

Originally Posted by WickedLou9

THis "everything is the government's fault" is starting to get really old.

Yeah, about as old as the "everything is the dirty capitalists' fault".

WickedLou9 · 12-18-2008, 04:41 PM

Originally Posted by stolz25

I'd disagree, millions of people were told if they paid into this system (involuntarily I might add) one day in the future they'd be taken care of. While so far this is true, it doesn't mean the program isn't fraudulant. Of course if you talked to Madoff's early investors they'd probably have said his program was the greatest thing ever. Social security won't be defined as fraudulant until someone doesn't get their money back from it on the guaranteed date, which will happen eventually.

It's not fradulent because we all know what it is. Nothing is being hidden from us. For better or for worse. It's also a government so there is no end. there will always be new "investors" because the government makes it so. Totally ignoring whether you like SS or not, it's not a ponzi scheme in the sense that no one is being decieved and that there is no danger of the "investors" deciding to withdraw all of thier money, thus exposing the ruse. It can't happen.

WickedLou9 · 12-18-2008, 04:43 PM

Originally Posted by stolz25

Yeah, about as old as the "everything is the dirty capitalists' fault".

I have never said that and I never will say that. I generally believe that the free market handles things best, with few exceptions. I understand that there is no such thing as a pefect system and I see no reason why we can't attempt to correct shortcomings of one system with strengths of another. That's really it.

stolz25 · 12-18-2008, 04:45 PM

Originally Posted by WickedLou9

It's not fradulent because we all know what it is. Nothing is being hidden from us. For better or for worse. It's also a government so there is no end. there will always be new "investors" because the government makes it so. Totally ignoring whether you like SS or not, it's not a ponzi scheme in the sense that no one is being decieved and that there is no danger of the "investors" deciding to withdraw all of thier money, thus exposing the ruse. It can't happen.

Sure it can. If the later investors (aka unwilling theft victims) are a large enough group, they will politically change the system, shafting the current payers. And fraud is only required from private ponzi schemes because they have to trick their investors into paying them. The government has no such problem because they have force, so there is no need for fraud.

WickedLou9 · 12-18-2008, 04:48 PM

Originally Posted by stolz25

Sure it can. If the later investors (aka unwilling theft victims) are a large enough group, they will politically change the system, shafting the current payers. And fraud is only required from private ponzi schemes because they have to trick their investors into paying them. The government has no such problem because they have force, so there is no need for fraud.

BUt then you bring into question all taxation. You are describing all taxes. I know you don't believe in govt and thus you don't believe in taxes. I don't see the point in discussing it.

stolz25 · 12-18-2008, 04:50 PM

Originally Posted by WickedLou9

I have never said that and I never will say that. I generally believe that the free market handles things best, with few exceptions. I understand that there is no such thing as a pefect system and I see no reason why we can't attempt to correct shortcomings of one system with strengths of another. That's really it.

So far today you've suggested we need to bailout the auto industry, CEO pay is too high, brought up investor scandal with Madof, and are defending one of the worst government programs to ever exist. I think it's pretty clear where you stand on free markets.

Phantom · 12-18-2008, 04:51 PM

Originally Posted by stolz25

I'd disagree, millions of people were told if they paid into this system (involuntarily I might add) one day in the future they'd be taken care of. While so far this is true, it doesn't mean the program isn't fraudulant. Of course if you talked to Madoff's early investors they'd probably have said his program was the greatest thing ever. Social security won't be defined as fraudulant until someone doesn't get their money back from it on the guaranteed date, which will happen eventually.

The fraud in Madoff's case was he told investors he was investing their cash. He was not investing their cash. He was paying off the older guys with the money the new brought in.

Everyone knows how social security works. People are not being deceived. They don't even have the option to not participate.

stolz25 · 12-18-2008, 04:52 PM

Originally Posted by WickedLou9

BUt then you bring into question all taxation. You are describing all taxes. I know you don't believe in govt and thus you don't believe in taxes. I don't see the point in discussing it.

I didn't bring up taxation until you brought up fraud. My only point about taxation was that the government doesn't need fraud to have a Ponzi scheme, because you took the absence of fraud to mean that SS doesn't fit the bill.

stolz25 · 12-18-2008, 04:53 PM

Originally Posted by Phantom

They don't even have the option to not participate.

Exactly

WickedLou9 · 12-18-2008, 05:03 PM

Originally Posted by stolz25

I didn't bring up taxation until you brought up fraud. My only point about taxation was that the government doesn't need fraud to have a Ponzi scheme, because you took the absence of fraud to mean that SS doesn't fit the bill.

You did when you said that Social Security is a huge ponzi scheme and no one cares. When you say that you are saying essentially that all taxation is fraud. That's fine. But we're now really talking about something else and not what the thread is about. Usually we try and keep it on topic.