The Biggest Ponzi Scheme

Bernard Madoff admitted yesterday to running a $50B ponzi scheme for a very long time. Basically, what he would do is take money from you or your organization and pay out some money each year, so-called returns on the investment. Anyone who is even remotely intelligent should have noticed something, as his returns were about equal and increased by an equal amount each year. He never had a loss in 10 years.

It seems he made most of his money off his own people, the Jews. He cultivated relationships with Palm Beach and Long Island society and used his contacts at Yeshiva university to get to the money. Several Jewish charities are now going out of business because they had entrusted him with their endowments, which are now gone.

Overall a very strange case, but it brings us back to the maxims:

• If it sounds too good to be true, it probably is.
• Don't put all your eggs in one basket.

Clean Coal

This is my new favorite ad.

Good thing I sold F

The bailout is dead. At least for now, and now is all that GM and Chrysler had.

Even so, tomorrow is going to be a really rough day in the market. GM and Chrysler are weeks from Ch 11 and months from liquidation, while Ford may be able to drag on a bit long enough for a sliver of hope. I predict that Dow could be down 700+ pts within the next week. Could be a good buying opportunity in some sectors but the worst is still out in front.

The Free Market Responds

Ayn Rand fans are speaking out against the bailouts and the current regulatory climate. They are also blaming Ayn Rand's friend, Alan Greenspan, for the mess. I concur, at least with the Greenspan part. We'll see how the increased spending turns out. For now, I'm siding with Krugman.

Obama doing well, says everyone

Barack Obama is doing extremely well in this transition effort, so say the polls.

I know of many who did not back him in the primaries who are happy with his presidency so far. Including the stock market, which is up considerably since he won the election.

I can't think of anyone who is pissed off with what he's been doing/saying. Some are reluctant to endorse him, but I don't see much criticism with his current choices (with the possible exception of Clinton).

Negative Interest Rates

Wow.

Another IL Gov Bites the Dust

It looks like another Illinois governor will be going to jail.  The current winner of this contest, Rod Blagojevich, allegedly attempted to sell President-Elect Obama's vacant senate seat to the highest bidder. 

 

Obama, who had put in a recommendation for the appointment, was apparently not well liked by the governor.  Blagojevich said that all Obama would give him is appreciation, "fuck that."  Or so the complaint reads.

 

 

More here: http://www.washingtonpost.com/wp-dyn/content/article/2008/12/09/AR2008120900987.html?hpid=topnews

The One Tax We Need

Tom Friedman's right. The one tax we really need is that on carbon. We need to tax the greenhouse gas emissions of various products, changing consumer buying power. Want a good example? I, like anyone who has done the math, have changed all my lightbulbs to CFL's, since they will save me abaout $10 each over the long run, even though they cost at least $2 more each compared to old fashioned light bulbs. But Joe the idiot doesn't see that. He sees the "weird curly" lightbulbs costing $3 while he can buy the old kind for $.50 cents. Well a carbon tax would probably make the old lightbulb cost $3.50 or more, making the decision more easy. In the end, he'd still save money, but this would be a good nudge in the right direction.