Greed is Good?
I know I’m opening a can of worms here, but the more I read about the Bernard Madoff case, the weirder I find it.
The guy was a crook, and I think it’s good that a white-collar criminal is being made an example of. It’s refreshing to see someone actually having to deal with the consequences of their actions instead of being given a slap on the wrist.
But at the same time, I’m having trouble working up any sort of sympathy for Madoff’s victims. These are people who thought they had found some sort of infallible get-rich-quick scheme. Most of them jumped onto Madoff’s offer because it seemed “too good to be true”. Well, it was. One of the basic tenets of investing is to understand what you’re investing in. If they went through with the investment regardless of their ignorance, then it’s their own fault and sucks to be them. If they understood Madoff’s scheme and went through with it anyway, then they were just being greedy and, again, sucks to be them.
The worst part, though, is that these people actually make it difficult to work up any sympathy for them. Madoff’s victims were mostly wealthy businesspeople who were enticed by his unusually high returns. They got burned. They want compensation, which only seems fair, right? Sure, except it’s the Securities and Exchange Commission that would be paying out. Or rather, it would be the tax payer, via the S.E.C. that would be paying out. Is this fair? As Joe Nocera of the New York Times says, (somewhat invoking a modern-day Godwin), “Why should my tax dollars go to helping Madoff victims? This is not 9⁄11.” We’re in a murky, grey area of fairness now. Thankfully, we have the victims, like a fucking foghorn, warning us “here be dragons”. They don’t just want compensation of their initial investment. No, no. They want compensation based on the last statement they received.
Just let that sink in for a second.
They don’t just want the money they lost. They want the money they had been promised by a crook. The entire point of the Ponzi Scheme is precisely that the money does not exist in the first place, but that doesn’t matter to these people whose greed apparently ignores common sense. This is entirely like falling for one of those Nigerian 419 Scams, and then demanding that the government compensate you to the tune of the five trillion dollars you were promised.
Who said greed is good?