No Idea Why!
I’m sure that most of you have already heard about Ex-NASDAQ chairman Bernard L. Madoff was arrested on a securities fraud charge. He’s being accused of running a “Ponzi scheme” to the tone of $50 billion. Anyway that’s what he thinks the amount was. The amount investigators say is around $18 billion in cash. I would be willing to bet that no one will ever really know the amount, because of the size of the fraud. And the real dumb thing about all this is that some of the investors always thought that Madoff, 70, was doing something wrong, and that’s why they invested with him. But they thought maybe insider trading because of the results he was producing, but that wasn’t the case. If you have no idea what a “Ponzi scheme” I will do my best to tell you. It’s when you get about 100 of your family and friends to invest $1,000 up front. Then you just simply send them a statement every quarter stated that their invested made 1 or 2 percent. You keep the amount just low enough to keep them happy and to make sure they keep their money with you. Then as you send them their statement every quarter showing increases they start getting happier. Then they start telling their friends and family to invest into the fund, and then it begins to grow. I boy did it grow, somewhere in the middle of $18 to $50 billion. The problem for Madoff was when clients started to ask for their money to be pulled out. And when he no longer could cover the withdraws any anymore, it fell apart. He’s now looking at 20 years in prison for what he did. He want to head on over to MBT shoes to pick a new pair for court. Anyway, why he did this crime is anyone’s guess at this point. There’s more to this story but I will wrap it up with this, don’t trust any investor, invest on your own.
