24 Comments

1. X3NA:

That’s okay, as usual US taxpayers will foot the Mad Dog Madoff bill:

…a federal judge on Monday threw a lifesaver to investors who may have been duped, saying they need the protection of a special government reserve fund set up to help investors at failed brokerage firms.

Dec 17, 2008 - 7:37 am 2. Mark:

Kos provides quite a list of political action groups and think tanks that received grants from the JEHT foundation. Many of the organizations are ‘voter rights’ entities that assist in getting out the Democratic vote. David Horowitz has been connecting these dots between funders and radical causes for years, but it’s interesting nonetheless to see this particular nexus and unraveling.

X3NA notes that US taxpayers will foot the bill. I suspect this is true, at least in the sense that government grant programs will be created to further the work of the now grant deprived organizations. While President Bush launched a faith-based initiative that sent some funding to do-good initiatives, President Obama will no doubt launch a quite different kind of faith-based initiative.

The amount of funding provided by JEHT was a pittance compared to the $50B income of the Madoff fund. Nevertheless, $33M or so doled out each year provides enough crumbs to keep the mice, whether from the SEC or at the Daily Kos, occupied and diverted away from the main feast.

Dec 17, 2008 - 8:05 am 3. Mark:

A correction to my comment, above. JEHT was not funded by Madoff. Here’s a statement from the JEHT website: “The funds of the donors to the Foundation, Jeanne Levy-Church and Kenneth Levy-Church, were managed by Bernard L. Madoff, a prominent financial advisor who was arrested last week for defrauding investors out of billions of dollars.”

Dec 17, 2008 - 8:39 am 4. bvw:

Thanks for the Glimmers of Hope left among the plague-besotted carcasses on the war ground after the last election and the still on-going bailout panics.

Dec 17, 2008 - 8:39 am 5. wildernesscalling:

GOds timing and work is wonderful and to think he’s just begining!

Dec 17, 2008 - 9:19 am 6. Tinfoil Hatter:

“That’s okay, as usual US taxpayers will foot the Mad Dog Madoff bill:

‘…a federal judge on Monday threw a lifesaver to investors who may have been duped, saying they need the protection of a special government reserve fund set up to help investors at failed brokerage firms.’”

This is completely outragous. I got taken by a carnie when I was twelve…can I submit a claim?

Dec 17, 2008 - 9:31 am 7. Frank:

Yes, where would these organizations be without Capitalism to finance them!

Dec 17, 2008 - 10:05 am 8. 49erDweet:

Many of the commenters on Kos kept dazedly asking each other “where did the money go?” as if they had no comprehension of what happens during a “ponzi scheme”.
“The money” was partially skimmed off as it came in and sent to sunnier and more legally obscure climes while the rest of it was used for overhead and returned each month to investors in the form of “dividends” and “earnings”. That’s the water and fertilizer that keeps a ponzi scam crop healthy and growing year after year for money farmers like Madoff. So the simple answer is that much of the money has already been expended or returned. The rest is probably sequestered.
And since all those regular payments had to be newly generated each month based on fictitious “account activity” rather than real data it took more administrative manpower to facilitate than has to this time been acknowledged. Other heads should roll on this, too, I would think.

Dec 17, 2008 - 10:32 am 9. myna:

The government will be a complicit with the ponzi scheme. The bubble has burst but they keep feeding the beast.

Soon the dollar will be worthless. Welcome to the Banana Republic called the US of A.

Dec 17, 2008 - 10:40 am 10. Fat Man:

“JEHT Foundation, a major source of grants for organizations like Amnesty International, Human Rights Watch, and the ACLU”

See, a silver lining in this dark cloud.

Dec 17, 2008 - 10:50 am 11. 12-17-08 | Drive Time Happy Hour:

[...] Richard Fernandez: US News and World Report reports that the Daily Kos has declared Bernard Madoff Public Enemy Number One for impoverishing all of its favorite charities. The previous post pointed out that “activists” have a curious relationship with money. They don’t make it, but they need to spend it. They need what they loathe. What can I tell you? [...]

Dec 17, 2008 - 11:59 am 12. George Bruce:

#1?????

You mean he is worse than GGGGGGGeorge BBBBBBush???????????

How is that possible?

Dec 17, 2008 - 12:48 pm 13. Alaska Paul:

Everyone wants a bailout. The only problem is that Congress got there first and bailed out their buddies and benefactors. The taxpayers will be left holding the bag. By the time us Just Plain Joe Taxpayers™ get our bailout, there will be no money left except Zimbob-like $100 billion dollar notes in a light blue color.

With freedom comes responsibility. Since the 1960s we as a nation have demanded freedom, but have collectively shirked responsibility. They do go hand-in-hand. Freedom without responsibility is license. Welcome to the age of narcissism and the sociopath.

I fear that our collective lack of responsibility and ethics is coming home to roost. It is like a disease of opportunity that attacks the body politic when it is weak. The disease will have to run its course. I hope that it does not kill the patient, that is, the US and our Constitution.

Dec 17, 2008 - 1:22 pm 14. Fred2:

It’s always possible that the money was honestly lost in the stock market. And then they started by covering old investors with money from new investors, in the hope that later on they’d make back the money.

The road to Hell might possibly have been paved with good intentions.

Only God and Madoff knows if this is true, of course.

Dec 17, 2008 - 2:46 pm 15. K:

One of the problems with a bailout in this matter is setting the right level. It isn’t clear what any investor should receive. Therefore any settlement must favor some over others.

Are investors to receive the money they put in? Should they receive that plus some arbitrary rate of return? Should they receive the huge amounts they thought they had two weeks ago or a year ago?

Obviously the huge amounts they saw on their last statements never existed. So asking the government to bail them out for returns that were never made would be nonsense.

Early investors drew lavish “dividends” for decades; but it was phony money which was being taken from more recent investors. So some of them profited by the fraud. It is hard to argue that those who profited should be treated equally to those who lost every cent.

More recent investors were completely defrauded since they received few, if any, dividends.

And among earlier investors there would be some who simply reinvested ‘dividends’ for years. These are the most hurt because they had to pay income taxes each year for income that never existed.

Well, the Bush administration opted for bailouts. And the opposition hardly opposed. No one knows where this will end. Yet everyone knows where it must end if we don’t act rationally soon.

Dec 17, 2008 - 3:05 pm 16. Ivan:

All these foundations should be disbanded and hit to the hilt with death duties. I’m glad that the Market did some good in the end. Consider; the old patriach and mater worked their their finger-nails off to realise their version of the American dream. Living off their hard work their descendants use the proceeds to finance activities that end up putting other people’s lives and freedoms in danger. Access to easy money only encourages solipsisms and idiocies, the newly chastened wards should turn to Jesus Christ as He is the only sure foundation.

Dec 17, 2008 - 7:55 pm 17. Robert:

Madoff’s actions seem to be an effective way to smash the Western “Cathedral” Ruling Class’s information monopoly power, by destroying their finances.

Dec 17, 2008 - 8:21 pm 18. Lifeofthemind:

Madoff seemed to send money to one Republican candidate and a whole string of Democrats campaign committees. My hope is that Yeshiva and the other charities can recover from the damage. Several worthy NY charities are in severe trouble. By all reports the same applies in Palm Beach County. The charities are not the criminals here but the victims. A University, Museum or Hospital should be judged on its own merits, not those of the crook who lost their money.

That said there is an issue in which the Democrats have abused the status of charities by using them to advocate for political activity, including having them advocate for expenditures of tax dollars which are then used to support further political activity. They have also been used to provide for employment of political operatives whose partisan conduct should be prohibited in a charitable setting. Finally there is the practice of left wing operatives in gaining control of charitable institutions and using them to advocate causes that would be anathema to the founder whose legacy the institution is supposed to honor. That certainly applies to both the Ford and the Rockefeller foundations. In this case however the actual donors are often still present to see how their legacy has been abused.

Dec 17, 2008 - 11:13 pm 19. Starko:

Fred2, you’re probably right, but this is exactly why you cannot do these thing no matter your intentions. Some, however, can’t bear the pain of failure personally via their loss of status. Others just see the dollars rolling in and can’t bear the thought of not having those.

Bayou was the last case similar to this, and there it was similar- he actually traded at the beginning, but did terrible. I think he’d trade now and again all the way up to the end but of course there was no hope in making up the losses.

Dec 18, 2008 - 5:47 am 20. Roderick Reilly:

May I laugh uproariously at the misfortune of these parasites and their goody-goody causes?

Hopefully, the Kos-acks and like-minded “progressives” (the creepiest term since “Scientologists”) will continue to be dismayed, miserable, angry and depressed throughout the administration of their new President. May he dissappoint the bejeesus out of them.

Dec 18, 2008 - 1:13 pm 21. Daniel:

If this “charity” founded in 2000 got 1% interest each month and spent it all each year at the end of the year, it got more than its money back after 8 years.
So it spent all its original investment.
If this was a true Ponzi scheme which did no investing at all, the charity got more than its fair share. So what is Kos complaining about?

It is the poor schmucks who paid income tax on the fake earnings who took a real bath. If the supposed income rate per month were 1.5% and the money was left in, it quadrupled in value after 8 years.

Someone paying income tax on the fake earnings shelled out as much as his original investment in taxes over the years. However, he can get back the taxes paid in 2005-7 by filing an amended return, and won’t have to pay for 2008. This will give him back more than half of the initial investment. Is that so terrible?

The notion that what you lose is the amount some crook promises you that you don’t get is fun for headlines but, hey, I’ve lost billions this way. I get on the average of three emails a day saying I have won at least a million dollars in a lottery I never entered, or in some obscure inheritance from Africa, or some other ridiculous scam. If I add the amounts I should get from these, if they were true it would come to billions. So have i lost billions in capital from these situations? I have lost billions that were promised me that I will never collect.

OK so they are obvious frauds. So I have really lost only my original investment in these things, which is zero.

Why don’t we apply the same logic to this fraud? Then it would dwindle to insignificance to tax paying individuals (most probably losing at most half their initial investments considering their tax recoveries.) and in any case losing far far less than 50 billion in all. And non taxpayers like charities probably spent almost as much or perhaps more than their initial investments.

OK someone who put all their money in this fraud in 2008 or 2007 really got screwed. How many of these were there?

Dec 19, 2008 - 1:25 am 22. Alexis:

My educated guess is that petroleum producing nations may have gotten taken by Ponzi schemes too. At least some of the massive drop in the price of oil may have come from a desire on the part of petromonarchies to cash in on the oil market to their recoup losses on Wall Street.

Dec 19, 2008 - 2:04 pm 23. Steynian 299 « Free Canuckistan!:

[...] DEMOCRATIC DONOR.. They got took, their $$ gone flown; The Ponzi scheme in which we’re all involved …. [...]

Dec 20, 2008 - 3:09 pm 24. Steynian 299:

[...] DEMOCRATIC DONOR.. They got took, their $$ gone flown; The Ponzi scheme in which we’re all involved …. [...]

Dec 20, 2008 - 3:14 pm

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