Hey, Bernie!

December 20, 2008

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Am I alone if finding the Madoff  affair a bit, well…humorous?  C’mon, lots of rich people who still don’t have enough and are seduced by something too good to be true.  A modern retelling of the Goose & the Golden Egg fairy tale?  There’s a reason they’re called fairy tales!

What a character!  So low-key.  As one friend said, he’d rather spend time on the Riviera than going to society parties.  Well, so would I!  Just a nice Jewish boy who did well by doing good.  Did really well.  The New York Times has so many references to the “clubby world of Jewish philanthrophy” it might make even a Jew-hater feel sorry for those rich Hebrews who were taken!

Let’s revisit some old stereotypes:  the smart Jew – he’s smart.  What about those rich Jews he fleeced – weren’t they smart too?  And is everyone else so dumb?  Those French investigators from a major bank spent three days with Bernie’s crew and concluded that something was rotten in Madoff land – they didn’t bite!  The greedy Jew – guess he was greedy too, but who isn’t on Wall Street?  Isn’t that the biggest lie of all, that Wall Street “wizards” are smart, not just plain avaricious?  The smart, virtuous Jewish immigrant who works his way up the American ladder to fame and fortune?  Well, he was raised on Long Island, but still…

And reverberating through all the stories in the press is the unspoken refrain, “Hey Bernie, we hardly knew ya!”  How long was he doing this?  He must have started off legit or he’d never have gotten his foot in the door of those country clubs.  I guess part of the appeal of this is the story of a regular guy who made good, but was an impostor!  Don’t we all dream of faking our way to riches and fame, at least once in a while?  He did it!  A bizarre and dark twist on the old assimilation-outsider-immigrant American dream too.

And the humor?  Well, to me, a Ponzi scheme has its own intrinisic comedy.  Shovel out the money as the new money comes in, but the pile grows bigger.  It’s like the Sorcerer’s Apprentice, can’t you see it?  Marx Brothers finance!  And then it tumbles down and everyone asks, “How could it happen?”  It’s classic.

Well, maybe it’s just schadenfreude, but I can’t suppress a chuckle.  That Bernie!  What a character, oy!

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Schadenfreude Anyone?

March 21, 2008

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It’s hard to restrain oneself from chuckling with glee at the ci devant masters of the universe at Bear Stearns as they contemplate their fortunes turned to dust in the twinkling of an eye. Surely the ghost of J. P. Morgan is heaving his paunch and laughing heartily somewhere, up there? down below? jpmorgan.jpg Still, at the banking firm of Bear Stearns – should we just call it BS? – where the culture was to buy the stock of the padrone, quite a few of very ordinary folks will go down with the ship. Secretaries, mail-room workers, lower level admin and research staff, etc. In terms of percent of the people affected, they will be the majority, and they are royally screwed.

In a crisis, they say, you see what people are made of, and so too, a system. Without trust, there can be no business, and trust is dwindling a bit these days. “Come to think of it, just how were those people making all that money?” Why, when you examine the entire business, it does seem a little like a shell game, a Ponzi scheme, don’t it?

It’s all fine as long as the stock is going up. If you aren’t getting rich, it’s your fault, your genes, your backbone, your sorry moral state. The elect and the masters are chosen by The Market, and the words of the Lord are written in the annual reports (doctored, it’s true, but every deity needs an interpretor, a prophet). Now, once again, we hear the words of Captain Renault from the film, Casablanca: “I’m shocked, shocked to find that gambling is going on in here!”

Oh well, damn the torpedoes, full speed ahead and socialize the risk, privatize the profits! See the recent NY Times editorial on this that sums it up well.

Meanwhile, consider this snippet from a day or so ago in an article about the collapse of Bear:

“In this room are people who have built this firm and lost a lot, our fortunes,” one Bear executive said to Mr. Dimon with anger in his voice. “What will you do to make us whole?”

Why the hell should anyone care about making this troglodyte “whole?”