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And then there's this, about a law partnership:
So the partnership funds are missing; their escrow accounts are empty; Dreier let their malpractice insurance lapse (so all partners may be liable for this misconduct personally); and somebody unknown took the Picasso off the wall.
Such things tend to be discovered in crashes, when people go looking for their money. But why do bright people fall for such arrangements in the first place?
It may help to have thought about checks and balances, or know (thanks to L. Sprague de Camp) that Stalin pulled a similar arrangement in ascending from just one of the boys to The Great Helmsman,
Such things tend to be discovered in crashes, when people go looking for their money. But why do bright people fall for such arrangements in the first place?
It may help to have thought about checks and balances, or know (thanks to L. Sprague de Camp) that Stalin pulled a similar arrangement in ascending from just one of the boys to The Great Helmsman,
The most insightful commentary on the Madoff collapse:
The video sidebar describes what a Ponzi scheme is (report good results; attract new investors; if an old investor asks for his money back, pay him out of the new investments; and pocket the rest of it), and expresses surprise there aren't more of them. (Warning: it comes up automatically if you click on the link.) I agree; this one seems to have been sold with the slogan out of the South Sea bubble: "A company for carrying on an undertaking of great advantage, but nobody to know what it is."
Update: It's not that you can't cheat an honest man; but it is harder. (Note the originality here: Ponzi claimed 30% a month; Madoff claimed 1% every month. That is a novel approach, and may have fooled some of the non-profits, who would have jibbed at Ponzi's claims.)
The video sidebar describes what a Ponzi scheme is (report good results; attract new investors; if an old investor asks for his money back, pay him out of the new investments; and pocket the rest of it), and expresses surprise there aren't more of them. (Warning: it comes up automatically if you click on the link.) I agree; this one seems to have been sold with the slogan out of the South Sea bubble: "A company for carrying on an undertaking of great advantage, but nobody to know what it is."
Update: It's not that you can't cheat an honest man; but it is harder. (Note the originality here: Ponzi claimed 30% a month; Madoff claimed 1% every month. That is a novel approach, and may have fooled some of the non-profits, who would have jibbed at Ponzi's claims.)
