THANK you, Bernie Madoff! That might seem like a strange start for a column. Madoff’s beyond-despicable behavior took place over decades, during which time he masqueraded on this planet as a human being.
He took — and the official count is fuzzy on this — anywhere from $50 billion to $160 billion of people’s hard-earned money and, in one way or another, made it disappear.
Poof! All gone — except for the houses, yachts, planes and limitless other tangible trappings of decadence once enjoyed by the Madoff clan.
As you already know, Madoff pleaded guilty soon after his con game began to unravel. And yesterday he was given a symbolic 150 years in jail.
He will die in jail; alone and hated, the evildoer who has gotten what he deserves.
In fact, think about this: If the 71-year-old Madoff could be reborn as an infant he’d still have enough leftover jail time from the 150-year sentence to die a second time in the prison.
That, folks, is bad karma.
But Bernie Madoff will also leave an important mark on our society: He is, by far, the most recognizable symbol of a financial system that has gone horribly wrong.
In fact — as the saying goes — if Madoff didn’t exist, we’d probably have to create him.
That’s because every tragedy needs a villain. And Madoff was perfectly cast for the lead role in the financial horror story we are now living through.
It is, admittedly, very little to be thankful for, especially when so many people have suffered and so few other villains have been caught. But Madoff stole, at most, $160 billion. While that’s an astounding amount of money, it is nothing compared to trillions in wealth that has vanished over the past nine years.
First there was the so-called dot.com farce when get-rich-quick promoters convinced foolish investors that the Internet was a cyber road paved with gold.
It wasn’t. And when the stock market collapsed in 2000 investors lost heavily.
But no one could be fingered as the main villain because there were just too many of them.
Then there was the housing bubble.
Americans of all economic strata were urged to buy real estate by hucksters who didn’t explain the risk and who put would-be buyers in touch with corrupt lenders who, in turn, were dumping their shaky mortgages on an unsuspecting financial world.
I dare you to name one bad guy in that whole situation.
Unlike Bernie Madoff those crooks took their money and ran. And most will never be caught.
Or how about naming one regulator or public servant in Washington — elected or not — who was obviously responsible for not protecting the American public and, in effect, allowing Madoff and others like him to fleece the public. You can’t do it.
Or come up with a single culprit at the credit rating agencies who didn’t do his job and allowed toxins from the securities that Wall Street brewed to leach into the world’s financial bloodstream. Or try to name one appointed official — whether he was Treasury Secretary, head of the Federal Reserve or just a guy who had one of the last three presidents’ ears — that can be directly blamed for the fiasco we are now living through. Alan Greenspan? Doesn’t count because while he made some very bad judgment calls there was never a sign that the Federal Reserve chairman was dishonest.
The fact is that before Bernie Madoff came along nobody was playing the role of heavy.
Today, just mention the name Madoff and people will automatically cringe.
Maybe we’ll learn a lesson from Bernie. Maybe this will deter others from trying to top his achievements.
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Since today’s theme is “cons” let’s discuss the stock market.
Stocks rose nicely yesterday and pretty soon you’ll be hearing noise about how Wall Street is starting to get a whiff of an economic rebound.
Don’t be sucked in.
The fact is that stocks were buoyant because it is the end of the quarter and traders are purposely trying to make their performance look better.
The economy isn’t doing much of anything although it is helpful that we don’t have politicians running around anymore screaming about how the sky is falling.
This Thursday’s report on the employment market is likely to show the loss of hundreds of thousands of jobs in June.
And the unemployment rate should continue to climb.
Corporate profits stink. And Wall Street’s rally over the past three months is making the stock market look aw fully expensive.
That’s my way of say ing “be careful.”
I predicted stocks would rally last December and again this past spring.
Back then I could sense that traders were going to push equities highly on the slightest bit of improving news about the economy whether or not it was valid.
Now we are getting into a very dangerous period for stocks. Don’t expect too much.