Madoff Scam, $50,000,000,000 UK info (Time Update)

[Mat Hammond]

http://business.timesonline.co.uk/tol/business/ind...

More bad news for Local Authorities and the Abbey

This is very very bad...

Bit more here;

http://business.timesonline.co.uk/tol/business/ind...

Edited by Mat Hammond on Monday 15th December 10:33

[fcat]

and of course this will do nothing for investor confidence prompting further redemptions from hedge funds and investment firms, which in turn will stuff alot of asset prices as the market spirals down in the face of forced redemptions. This will hit a lot of institutions and indivduals one way or another. Anyone got a pension?

I had a pension once, it was with Equitable Life. 'nuff said. Over the recent years I've been carefully putting money into a new pension. I looked at its value the other day and wondered why I had bothered. Should have spent it on good wine, fast cars, etc,. at least there'd be something positive to remember.

On the subject of frittering money away, I can understand how someone can embezzle a few million for a great lifestyle, but 50 billion?! I mean, what did he do, buy a couple of middle-sized countries? How do you splurge that amount of money with little or nothing to show for it? (Of course I'd be happy to look into that further if someone could come up with the research funds. Oh sorry, apparently I'm too late, a Mr G. Brown is already fully engaged in that research..)

And how come no one noticed?

[DucatiGary]

would seem the americans screwed us with the sub prime gag and now this.

id be very wary doing any biz with the us till they can sort themselves out

[Mat Hammond]

How much more bad news can there be?

I am an IFA and the whole investment market is starting to wilt....

[Diderot]

Appropriate name too.

[Mat Hammond]

coyft said:

$50 billion fraud and he is on bail.

Yes, when do we get the news about a suicide?

[Zod]

Just to be clear, he didn't pocket $50bn (although he did pocket a lot). he made out that he had assets under management $50bn in excess of the true amount, because he was paying out newly paid in money to established investors and claiming that represented the return on capital invested. He probably started out honest, missed targets one years, so dipped into new funds and then found that he could get away with it because in a rising market his supposed returns kept piles of new money coming in.

[Fittster]

Another failure of financial services regulators.

The idea he alone new what was going on with his firm seems a little far fetched to me.

[digger_R]

bit late to this one

http://www.pistonheads.com/gassing/topic.asp?h=0&a...

[fido]

Mat Hammond said:

How much more bad news can there be?

I am an IFA and the whole investment market is starting to wilt....

It's not completely bad news. A few more competitors in the investment industry will be taken out (and not for lunch). I see RBS, and more surpisingly, BNP Paribas (as they are pretty careful about where they invest) have been hit.

[Mat Hammond]

digger_R said:

bit late to this one

http://www.pistonheads.com/gassing/topic.asp?h=0&a...

I thought the updated info was relevant (UK Local Authorities etc).

Sorry

[Captain Cadillac]

This is exactly why I haven't had a penny in the stock market/traditional investments in 2 years now.

[speedy_thrills]

coyft said:

$50 billion fraud and he is on bail.

Not exactly a threat to society though.

How did he run the scam, what where the mechanics involved?

[Gargamel]

google ponzi scheme - actually one area where wikipedia is about right,

Essentially its a pyramid selling scam.

I promise to pay you a return on your investment with me of say 15% (usually above average returns) but I don't disclose a huge amount about how I make the money as this might mean that everyone will do it or some other plausible sounding bullsiht about arbitrage.

Then I simply pay your 15% return by taking the cash from the next investor .... then repay that investor with the third persons money and so on and on until ....

£50bn fraud uncovered !

Edited by Gargamel on Monday 15th December 12:05

[speedy_thrills]

fcat said:

Over the recent years I've been carefully putting money into a new pension. I looked at its value the other day and wondered why I had bothered.

That raises an interesting question for me, as I understand it the first time that the market got to it's current level was early 1997. Eleven years with nothing to show for it? What's actually going on here, have all western economies come to a standstill?

[RichardD]

speedy_thrills said:

That raises an interesting question for me, as I understand it the first time that the market got to it's current level was early 1997. Eleven years with nothing to show for it? What's actually going on here, have all western economies come to a standstill?

Which would make me ask if capitalism is infinite?

If so, how does it work?

Infinite immigrants coming to the UK to increase the population and increase GDP?
Everyone working at least two jobs and consuming twice as much ? Maybe we could get tablets that stop us needing sleep so we can do this as after all sleep is just being lazy when we could be helping Gordon.

Where does "growth" come from ? Obviously its about more stuff happening, but exactly how/what ?

[thehawk]

RichardD said:

Which would make me ask if capitalism is infinite?

That is a something that I just don't understand, it can't be infinite and we can't all be rich. Furthermore surely uncontrolled capitalism would eventually lead to large companies controlling everything and all real wealth ending up in very few concentrated areas.

[trickywoo]

fido said:

Mat Hammond said:

How much more bad news can there be?

I am an IFA and the whole investment market is starting to wilt....

It's not completely bad news. A few more competitors in the investment industry will be taken out (and not for lunch). I see RBS, and more surpisingly, BNP Paribas (as they are pretty careful about where they invest) have been hit.

I refer fido to a response he gave some months earlier

http://pistonheads.com/xforums/topic.asp?h=0&f...

Is it true the maximum sentance for Madoff would be 5 years inside plus $5 million fine? Not much of a deterent.

[scorp]

speedy_thrills said:

Not exactly a threat to society though.

How did he run the scam, what where the mechanics involved?

I was surprised he was got bail, it would be in everyone's interests that he, his lawyers and his close staff are kept away from paper shredding machines I would have thought

[fido]

trickywoo said:

fido said:

Mat Hammond said:

How much more bad news can there be?

I am an IFA and the whole investment market is starting to wilt....

It's not completely bad news. A few more competitors in the investment industry will be taken out (and not for lunch). I see RBS, and more surpisingly, BNP Paribas (as they are pretty careful about where they invest) have been hit.

I refer fido to a response he gave some months earlier

http://pistonheads.com/xforums/topic.asp?h=0&f...

Is it true the maximum sentance for Madoff would be 5 years inside plus $5 million fine? Not much of a deterent.

You might as well refer me to a response about head gasket failure on the k-series engine. So i stated that: Nick Lesson was acting illegally within a bank, nothing to do with bad investments. This was a pyramid scheme in an unregulated area of investment where it seems Madoff was running the show .. and your point is?

Edited by fido on Monday 15th December 12:43