Bernie Madoff “made-off” with $50 billion of peoples’ hard-earned money. I just want to know: Where is the money?
I’m beginning to believe there is no money–or at least, not as much as we’d like to believe.
The great bastions of the industrial revolution are toppling around us like so many houses of cards. The banking , real estate, mortgage, retail, automobile, credit card, and insurance industries are all in very dire financial straits. Value that was there 3 years ago is nowhere to be found.
They say that anytime you see a rat, there are at least 3 more lurking nearby out of sight. When we find a leading hedge fund operating as a ponzi scheme, do you think they are the only ones? Especially considering just about anything they could have invested in has tanked. Stay tuned.
The problem as far as I can see has been too much creative accounting over the last 10 years or so. It used to be so simple: companies sold products and services. Sales brought them revenue, which they used to pay their workers, pay their bills, and replenish and improve the products and services so they could sell more. Then, bookkeepers started learning problem-solving skills in grad schools when all they need is arithmetic. Instead of just counting the money and keeping track of it, they learned how to make the company look good to investors and the public. All this regardless of how the company is doing in reality.
I saw it with Peace Corps volunteers, I ‘ve been guilty of it myself, and we see in in big business now–the smartest people come up the the most unsustainable ideas.
This is what Einstein was getting at when he said that “any intelligent fool can make things bigger and more complex, but it takes a touch of genius–and a lot of courage to move in the opposite direction.”
It is going to take some serious courage to face the financial facts and go back to living within our means.