USA Today reports this morning that “Federal prosecution of serious financial crime plummeted as the nation headed toward one of the worst economic meltdowns in U.S. history.”  The story then goes on to note that, according to government records, between 2003 and 2009 “the number of federal corporate fraud cases plunged 55%; securities fraud charges dropped 17%; and bankruptcy fraud cases fell by 44%.”

This, of course, on the heels of prior reports that the SEC had investigated Bernie Madoff and instead of prosecuting him ended up inviting him in for tea and crumpets and a little consultation when he was in town.

The mind boggles. What could be the possible reasons why the government, charged with prosecuting white collar criminals who exploit our sacred financial institutions and the people they serve, would fail so egregiously to pursue their brief with aggression and verve? I’m considering several possible reasons:

• They were very busy making sure that the corporate annual reports of legitimate enterprises were properly formatted and all footnotes in order;
• The Administration during the period in question made sure to staff all Federal regulatory agencies with senior officers who were hostile to their core functions;
• Nobody in Washington at that time considered making a lot of money by any means possible to be a crime;
• The cat ate their homework.
• People at the agencies correctly saw that if they started prosecuting anybody for a variety of crimes, they’d have to go after most of the people then doing business in certain portions of the market;
• There was no perceived institutional upside in going after certain types of criminals;
• Everybody forgot what a crime was.

These are just a few possibilities. Students of the situation will note that the number of new cases prosecuted for corporate fraud took an immediate hockey stick upward in 2009. Studies are now underway to ascertain the cause of this increase.

Thanksgiving is upon us. And it’s the rare individual among us who doesn’t have a lot to be thankful for. As we prepare for Thursday’s festivities, I thought it would be nice to ask you what you would put on that list. Personally, here are some of the things that give me a warm and fuzzy:

I am thankful that Bernard Madoff is now a big kingpin in prison, both because it means he IS in prison and because I also get a laugh at the mental image of two old farts indulging in a pushing match from which the despicable swindler emerges triumphant. I like to think that a background in high finance prepares you for anything.

I am thankful that most of my friends still have at least modest expense accounts. It means I can still sponge off them now and then.

I am thankful that my house is still worth basically what it was assessed at when I got my mortgage.

I am thankful that Wall Street is still a festering sump pump of illogic, hubris and greed, and will continue to provide me with plenty to write about for the foreseeable future.

I am thankful GM still exists and is making a new Camaro.

I am thankful for Tim Geithner’s temper. It makes him do funny, interesting and sometimes very satisfying stuff. 

I am thankful that fewer people than ever can talk about the benefits of a deregulated, free-market system without laughing. Of course, I’m not thankful that they’ll keep trying until, in the end, they win again.

I am thankful that I haven’t needed to speak to a single attorney on a matter of personal importance this past year.

I am thankful that my medical insurance company paid a small percentage of my costs back to me, even if it was under protest and after repeated bludgeoning. Actually, I’m not that thankful. I think they stink. But I’m grateful that I have this opportunity to say so.

I am thankful for newspapers and magazines. I know that every smug aggregator out there must be too, since they provide 95% of all content you get on the web.

And in that regard, last of all, I’m thankful that a new system of communication exists by which I can write whatever the hell I’m thinking on any given day, with no benefit of research, no fact-checking and very little personal responsibility attached. In short, I’m very thankful for the Internet.

How about you? What do you find yourself appreciating at this potentially festive season?

Yesterday Frank DiPascali, Jr. pleaded guiltyto ten counts of fraud and other miscreancies in federal court. You remember Frank.  He was the CFO of the Madoff gang. Didn’t go to college. Started out pretty straight, probably. About 1980, maybe a little later, he began to get what the real picture was with the whole operation, since obviously no trading was going on anyplace. As the years went by, he worked closely with Bernie and the rest of the gang, many of whom are still at large, to fool and fleece a huge flock of sheep.

Some of the ruses they worked out would be funny, if you’re the kind of person who finds rubber crutches amusing. In one case, show trades were displayed for visitors, with one side of the transaction taking place for the benefit of onlookers and the guy on the other end, supposedly in Europe or the Far East, playing his part in a room down the hall. If these geniuses had put as much effort into running an actual business as they did running their Ponzi, they might have made some honest money. Or maybe not.  The markets are so notoriously unpredictable, unless you’re a banker with a guaranteed bonus.

We sort of have the outlines of the whole sorry story at this point, with a few gaps still remaining for names that have yet to be filled in on the prison roster. One big question still remains, though.  Here it is:

If I were Frank DiPascale, Jr., and I saw what was happening in the summer of 2008, I would have put aside perhaps ten or twenty million dollars very quietly and gotten the hell out of dodge. Same goes for Madoff, as far as I’m concerned. I mean, look at it this way: you’ve been a dirtbag for more than 25 years, a total, stone-cold crook taking the life savings from the wallets of the elderly, the charitable, your best friends and their families. Suddenly you don’t have the moxie to make a clean getaway? What gives?

Why didn’t these guys run away? I sure would have. If I were Frank DiPascale, Jr., I’d be sunning myself someplace where the extradition laws were modulated by the friendly local constabulary, and all my new friends were calling me Pablo or Francois or Mr. Wemberly. But they all stuck around to face their victims and the wrath of a righteous public that now hates anybody that has money, even if it was legally obtained.

Sentencing of Frank DiPascale, Jr. will await his cooperation with the Feds.  He probably won’t get the 125 years he’s up for, particularly if he keeps on wearing the fancy suit and tie he did at his hearing, rather than the sweatshirt and jeans he affected during his years as an accomplished white-collar criminal. Everybody’s crazy about a sharp dressed man, particularly if he’s singing like a bird.

It’s quite possible that the light that we are seeing at the end of the tunnel is not an oncoming train. True, at the parties I went to over the weekend a certain number of people were unemployed. This was in Northern California, which has been hit pretty hard in the tech sector and in real estate as well. But people were of pretty good cheer. Of course, they were drunk, but that doesn’t necessarily impart automatic merriness. I’ve known a ton of grouchy drunks in my time. No, there was definitely a little bit of hope in the air. 

I think that may be because it’s starting to look like the nasty creepazoids who prognosticated the death of all human life on the planet will be disappointed in the end. The game is now to figure out who will get through this thing, because when we’re all safely on shore the survivors will find a world in which they are faced with significantly less competition. There will be more meat, more vegetables, more space at the campfire. Here’s my guess at who will be there: 

A number of hearty newspapers: Yeah, there won’t be quite as many as there were before. But the ones who stick around will still control about half of all local advertising. 

A bunch of lean, tough car companies: And boy, are they going to need to get their brands back on track. How? With advertising, ladies and gentlemen. Therefore…  

Mass media: Targeting schmargeting.  Who do you think those monsters are going to require in order to get back in touch with all the folks who once again want soap, cars and increasing amounts of pharmaceuticals? And beer! Don’t forget about beer! 

Lots of new Madoffs: Things will look better. This will bring out the oldest couple in human history: the gullible and those who will prey on them.  

A bunch of shiny new philanthropists: The markets will soar. New people will get rich. And for a time, while the shame of having been selfish idiots clings to the marketplace, there will be those who try to help others who have yet to rise from whatever tragedy has befallen them. Most of them will probably be the biggest bad guys from the days of yore, a thought that never left my mind when I attended the Milken Conference in LA last week.

Tons of stinky HMOs: You can’t kill those things. 

A small, gnarly band of Republicans: Wow, are those guys angry. Right now, they’re down. But when things improve and unfettered exploitation of the market is once again in vogue, they’ll come roaring back into the spotlight armed to the teeth and looking for liberals. 

Book stores: Will there be as many of them? No. Will there still be some? Yes there will. What about the Kindle? The Kindle! Aieee! Look. The majority of people I know who have Kindles are in publishing. They go around with their Kindles and talk about the end of their own business. Talk about boring! 

Regulation: Somewhere in our collective memory, the majority of us will harbor some vague memory that it’s bad when the FDA, SEC, FEMA and other regulators in Washington are run by former executives and lobbyists of the industries they are supposed to be overseeing, apparatchiks who are in fact enemies of the agencies they are supposed to be managing. 

Florida: I’m as worried about climate change as the next person, but I still think that Miami will be above water. Also New York. 

Other: If you can’t imagine a world without it, it’s probably going to be here, smaller, leaner, more sinewy, and better equipped to make the grade going forward. So relax. 

You will also note that Twitter is not on this list.

1. Economics is a bunch of bushwah. Now we know it. Economists are obviously not only behind the curve on what has occured, they are in many cases the cause of it. It is not a science. It is not even an art. At best, it’s a craft, like pottery. As things improve, we can expect a bunch to begin operating pretty much as usual, though. Why shouldn’t they? It’s a living.

2. Wherever there’s money around, there will be crooks. Many of these crooks are well-dressed. Often they are at the top of whatever game they are bilking. Next time this all happens, people will once again be surprised that the guy who ran the exchange is the person who also managed the Ponzi scheme.

3. The Law is a ass. I believe it was Mr. Bumble in Oliver Twist who said it, but recognition of the unique aspect of the legal profession goes back to Shakespeare and beyond. Virtually all of the regulators and legislators who were supposed to be monitoring the finance industry were certainly lawyers, as were the lawmakers who were asleep at the switch until they could be assured of airtime on cable on the subject.

4. In God We Trust. All others pay cash. Every panic in history has been precipitated by the same stupid sequence of events. In Rome, for instance, a huge panic not that dissimilar to ours happened when some rich bankers underwrote a bunch of ships that were sent to the east. The ships foundered. The banks had over-extended themselves. They ran out of cash. People freaked out. In 1837, following another crash a few decades earlier, the banks once again forgot about the whole debt/equity thing and doled out huge amounts of money in western real estate. The market went bust. The banks went boom. The economy went into the tank for 10 years. A few years ago, my own corporation almost went belly up after its Financial Services Division lent a bunch of dough to a sleazy real estate outfit in New Orleans that just didn’t pay us back. Now we have this, and everybody asks, “How could all these smart people lend out so much stupid money?” Because that’s what they do to MAKE stupid money, Sparky. As soon as nobody is looking they’ll do so again.

5. The rich are not like other people. They’re not smarter. They’re not happier. They just know how the game is played and, for the most part, what to do to stay there. Sometimes everybody forgets that the whole thing is designed to keep the powerful in power and the rich in their McMansions, and the People are sold the idea that everybody can have their Baby Benz. And for a while, everybody sort of gets high on the idea that capitalism is a populist enterprise. It’s not. It’s for just a few lucky souls and manipulative hedgers and, really, the rest of us should really just buckle down behind our plows and keep our pennies in that coffee can by the window ledge. We’ll forget that, of course, as soon as the markets simmer down. Then the Ralph Kramden side of us will once again emerge from the closet where it’s been whimpering for the last 18 months, and we’ll all be back in the hunt for the next mystery appetizer.

6. The press is the running dog of the system. Of course there are exceptions. But in general the media covers the winners and puts a nice shine on their helmets. What you read is what they get. Now that there are fewer reporters than ever, and more blogspit in the machine, everything will only get worse in this regard. Right now, even at the height of our troubles, the food chain goes from security analyst and quote monkey straight to the wires and blogs and directly to you. And you read it and think whatever occupies your brain pan for the most recent five minutes.

7. Be careful who you insult while they’re on their way down. They will either rise up one last time, like Carrie’s dirt-encrusted fist from the grave, and pull you down with them, or they will meet you as they are on the way back up and chew your head off now that they can. Those in need of proof on this subject need only consider two short words: John Thain.

8. Nothing lasts forever. Not good times, and not bad times, either. And nobody knows when whatever train we’re on will arrive at the next station. Not nobody. Anybody who tells you they do is smoking something. You can either ask for some of what they’ve got or ignore them entirely, depending on how you’re feeling or what day of the week it might happen to be.

9. Breakfast is the most important meal of the day. Even when nobody else is picking up the check. Later on, when that starts again? Even moreso.

Okay, I hear you. You’re sick of the bad vibes. You want to get your collective head out of the community toilet. Stuff you’re tired of hearing about: bailouts, stinky hedge fund shenanigans, executive compensation, retention bonuses for guys who weren’t retained, criminal excesses by shady Wall Street buttheads, economic prognostications offered by those who didn’t prognosticate anything when it needed to be prognosticated.

You’re ready to move on. The innate optimism of the American spirit is beginning to bubble bigtime within your breast. Enough of this gloom and doom! It’s time to have a burger, down a couple of brewskies, hit the new ground running.

You’re not stupid, of course. You see the unemployment rate. You see the sales figures for the first quarter. You know that if you look, there is dismal swamp as far as the eye can see. But maybe not. Not for those who see just beyond that grim horizon. Over that rim, there is dawn, the kind of light that only those who look can perceive.

Proof of this fact comes in a new poll from CBS News and the New York Times. The Times reports that:

“… the number of people who said they thought the country was headed in the right direction jumped from 15 percent in mid-January, just before Mr. Obama took office, to 39 percent today, while the number who said it was headed in the wrong direction dropped to 53 percent from 79 percent. That is the highest percentage of Americans who said the country was headed in the right direction since 42 percent said so in February 2005…”

This tiny new embryo of optimism is fragile. A vast majority of people are still worried about their jobs and are cutting expenses back as much as possible. That’s just common sense.

But you know how it is. One of our national characteristics is a certain kind of creative Attention Deficit Disorder. We can’t stay any one way for very long. And we’ve been in the dumps for quite some time now.

Disregarding stupidity and evil for a moment, a huge element of what got us here is pure psychology and decay in attitude. Repair that, ladies and gentleman, and the rest will surely follow. And you know. Even if it doesn’t, getting there just might be a whole lot more fun.

Once again, Bernie Madoff is about to steal something of importance from us – the right to a really juicy, lengthy, painful and entertaining trial that drags him and his family through the muck and punishes them severely for their miscreancy before they even are convicted and sentenced.

What fun that would have been! 

And how much will now be concealed in the vault of time? Where will be the testimony that reveals all the ins-and-outs of the monster’s prodigious narcissism and cruelty? Will we get to see Lady Macbeth trying to wash her hands clean on the stand? How about all the smaller hyenas and jackals that served the great, bloated predator? How many Street weasels and stoats from the SEC will breathe a sigh of relief when the files are sealed?

Doesn’t the government represent the People? And aren’t we, the People, entitled to a satisfying and educational show here?

Perhaps it’s not too late to stop this ill-advised rush to judgment. The guy is old already! Are a few years in some plush correctional facility, in which he represents the most accomplished resident of the institution, punishment enough for what he has done to so many charities, schools and retired furriers? I think not!

We should have the chance to drag this festering homunculus out into the electronic public square and stone him! Him and his little dog, too!

Write your Congressman! Call the White House! Justice must be served!

This week we passed by a certain milestone for a modest little community like ours. We posted our 10,000th comment. It came from Laurel, of Santa Barbara, California, whose observation on that day was typical of the kind of thing that has made this blogspace such an addictive experience for me. Here is our 10,000th comment, rich with personal anecdote and interesting observation from someplace that is Not Here:

I live in a tourist town, santa barbara, ca. I have been watching the stores close for a few years now and the staff in the remaining ones becoming more harried. I see the workers taking on so much more and thankful to boot, that they still have a job. They are tired though. I also could swear I see new workers in the grocery store and banks, and they appear to be more qualified. Maybe I am imagining this, that employers are merging, hiring and keeping only the best. I don’t know what to think of this but everyone is nicer to each other.

Small business owners have usually sunk all that they have in their business and watching them lose everything, their hopes and dreams, everything, is reason enough to spend whatever it takes. So, if people are saving just in case, think again and spend a little, tip more, and drop the “were doomed” attitude and see what Bing sees; we can, we will, and we are going to make it.

on a personal note, i lost my job in epidemiology, but found out i could make the same teaching high school science and demand is high for females teaching math, statistics and physics. i recently had a legal matter, so i had to refinance for cash. The refinancing rate actually saved me more money then I lost. (I thought of Bing’s article when i calculated the new mortgage rate and realized my luck.)

Thanks Bing, you made my life a little better by pointing out to look for the cracks of light!

Thank you, Laurel. And thanks to all of you, first time commenters, long-time bloviators, story-tellers, complainers, philosophers, cranks and wisenheimers, for making this space what it is, whatever it is. You’ve given me your thoughts on airline travel, recession, depression, incessant solicitations from Chase, the triumphs of Apple and, sometimes, Microsoft, Bernanke, Paulson, Madoff and other great symbols of high finance up to and including Mike the Headless Chicken and Alan Greenspan.

Right now it’s pretty unclear what the future holds. I hope, frankly, that it starts surprising us in a completely different way pretty soon. But either way, if it does or if it doesn’t, I’ll keep showing up if you do. And who knows. I may have a few surprises coming soon myself.

And Laurel? Send me an email to bingblog@gmail.com with your info. I’ll send you something nice.

You could make the case that this era has produced possibly the worst bad guys in business history. Think about that for a minute. That’s really saying something. They’ve got a lot of competition. Carnegie and Frick, who shot their own workers. The guys who fomented the Teapot Dome, whatever that was. Who remembers? 

Somewhat more recently, during the days I still wore suspenders and power ties, there were a lot of bad guys, too. Many are philanthropists now, just like Carnegie and Frick, come to think of it. God bless ‘em and the work they do, but they were pretty bad. The fad then was to rake up companies as if they were fish in a net, gut them, and profit from the asset. It was called, in a most Orwellian twist, “the democratization of capital.” Most of the clever little miscreants got away with it, but a few got crazy greedy and messed it all up for the rest of us normally greedy people. There were a few really gross ones. Dennis Levine, for instance. Insider trading? Seems so mild now. 

Ours seems worse somehow. Just look at the harvest! Dick Fuld, the former head of Lehman Brothers, just sold his $13 million dollar Florida home. To his wife. For, reportedly, $10. You read that correctly. Ten dollars. You have to excuse me, but I just have to say… that’s so cool. What bravado! Mess with Dick Fuld, will you? Well, Dick Fuld has a few tricks up his sleeve! And the guys from GM, Ford and Chrysler, who flew to Washington to ask for money, each in his own private jet? Now Citigroup, which took a huge bolus of bailout bucks, is said to be purchasing a $50 million jet. Amazing. I’m sure there are a host of excellent business reasons they are completely justified to do so. I bet they will even save some money, in their minds. But really. You’ve got to hand it to them.

Then there’s Bernie. I really enjoyed the piece in last Sunday’s New York Times that did a thorough mental D&C on him. It was very entertaining. I’ve always thought that it took a certain kind of psychopathy to succeed in business. The bigger the nut, the better he or she does, pretty much. There are exceptions, of course. But Bernie is such a huge, juicy example. The sharp kid who didn’t do so good in school. All the smarty-fartys went to Harvard and Yale, and he had to go Alabama, which was fine, but not so Ivy League. Couldn’t take it.  After a year, went back to Long Island and attended Hofstra at night. He would show them! And he did, too. Put it over on everybody for a long time. Really stuck it to them all in one way or another. Even now, totally busted, and when he goes outside there’s a crafy, insouciant, twinkly, beamish thing going on. Something… proud. Fifty billion dollars. What an achievement in bad guy history. 

And then there’s the rest of us. All the Bernies in the world couldn’t exist without the support of the brokers, bankers, regulators, credulous investors, and enormous bigshots in their own right who make up the neural network that makes Bernies possible. 

But are we the worst? There’s a lot to consider. Take the guys who run the Chinese railway system, controlling the supply of tickets with violence when necessay, stabbing people, beating them upside their heads. Saw in the LA Times. That’s bad, if not quite as sophisticated. Still, they’re no slouches. I mean, putting poison into children’s toys, toothpaste marketed to kids, and pet food? That’s seriously not good, I admit it.

At the end of the day, however, I’d put our guys up against theirs anytime, at least for now. They’re coming up the ramp. But any nation that can produce a Rod Blagojevich has nothing to worry about in this particular contest.

It’s the last day I’ll be spending at the office this year. Always a funny feeling. Another year is gone. A new calendar must be cracked open. I feel like I should clean up, but there’s really nothing to get rid of. One day I guess I’ll leave this place for real, and perhaps it will feel a little bit like this, only moreso. This time around, I’m luckier than some. I get to come back and see how things work out for another cycle.

I won’t say a lot about 2008. I suppose there were many good things about it, although it’s hard to remember them now, what with all the Spitzers and Blagojeviches and Madoffs and Greenspans and Paulsons and Bernankes and assorted Wall Street miscreants, the bailouts and the purges and the blown hedges and wilted WaMus and all that. The list of losers grows so long that it’s hard to remember who we were mad at last month, last week, yesterday.

You kind of want to hope that 2009 will be different, and maybe it will be. We’ll have a new president. The markets will have to return to some kind of normalcy after a long period of disease. Like, creditors will have to start giving people credit again at some point, right? The debt folks will have to do what they do for a living, more responsibly, we hope. Car makers will have to figure out a way to sell some cars, which probably means somebody will start advertising again. Life will find a way.

The general feeling I get is that we’re all pretty glad to get out of 2008 with at least a portion of our skins on. Nobody I know is sad to see the old year go. That twinkle in the common eye might not be tears of sadness or rage. It might be a glimmer of hope.

Thanks to all of you who come here to browse, get excited, feel outrage or occasional amusement. I love to read what you write. I am very happy to publish the lot of you, as long as you keep it relatively clean and marginally on-point. One thing I do know about the year to come. I look forward to hanging with all of you as we chew over – and occasionally spit out – the events of this world as they unfold.

Now I guess I’ll just lock up and get out of here. I’ll see you when I see you, guys.

I’ve read a lot about the whole Bernie Madoff thing now, and questions still remain. I’ll leave most of them to the forensic accountants and the gumshoes now on the trail of who knew what, when. I do have one very simple one I’d like to offer anybody within the sound of my voice. 

Where’s the money? 

I know this seems like a rudimentary issue, and one I’m sure a lot of people are investigating right now. But I’ve attended a number of meetings, parties and private conversations over the last week or so that Madoff has been front page news, and I have yet to get a clear answer. 

Where’s the money? If the location has been revealed anywhere in video, print or online, I’ve missed it. 

Is it possible that he and his family spent it? I don’t think so. Even the greediest jerk in the world would have a hard time unloading $50 billion on sundries like houses, cars, boats, planes, even. If you spent like a manic chicken for decades, it’s hard to see how you would put out more than, say, $5 billion. I’ve made a list of things I would get if I had Madoff’s war chest and I’m afraid I can’t even get to that single digit number. 

Did he give it to charity? No, he seems to have preyed on charities as well as on the gullible wealthy. Yeshiva even gave him an honorary degree while he allegedly was fleecing them. 

Did he share it with cohorts? Perhaps. Maybe there’s something to that. Maybe we’ll find out that some of those who were ostensibly gulled were in fact themselves intermediaries who profited from the credulous losers who helped to erect this particular pyramid out of golden bricks and platinum straw. Still, $50 billion? That’s a lot of vigorish to spread around without leaving some footprint in the dust. 

So… where’s the money? 

Do any of you know? I’m really asking. Perhaps if it’s just lying around somewhere, we could go and pick up some of it. And if the guy still has any, don’t you think it would be appropriate to get it back? A whole bunch of people are missing it pretty badly, particularly at this festive time of year.

Looking over the list of poor saps who were hoovered into the Madoff money vacuum, it occurred to me that we might have found an excellent beneficiary of at least some of Mr. Paulson’s remaining bailout bonanza.

Why not make the straggling losers in the ponzi parade sign a statement attesting to their credulity, greed and overall foolishness, issue them each a nice, pointy dunce cap - and then help them out with a piece of what they’ve lost? Sure, we can take off a significant percentage of their ill-taken losses as punishment for their sins. Then let’s help them.

I spoke to my broker yesterday. She’s in Southern Florida. It seems that a lot of the old people there who are living out their lives on their investments, assembled after a lifetime of work, are now selling their modest, two-bedroom condos and pawning their jewelry. They’re broke. Imagine that. Eighty years old and without a dime to your name, all because you had to get in on the latest sure thing from the guy everybody trusted. It’s not right.

Likewise, a bunch of very credible charities are sucking the hose, funds that helped indigent widows and holocaust survivors and people suffering from illness so dire that they will be gone long before Madoff will have to spend one night where he belongs. And why is the guy still walking around on Park Avenue, anyway? Don’t they have jails for such people? 

Anyhow, even after Mr. Bush dribbles a little rain on the parched Big Three, there’s still going to be hundred and hundreds of billions just sitting around collecting minimal interest. You’ve got a whole bunch of victims out there who are guilty of nothing more than believing in the risk/reward game. Didn’t we all?

Please, Mr. Paulson! Have a heart!  It’s Christmas!

Word comes today that the SEC was informed about Bernie Madoff’s miscreancies several years ago, but engineered a neat solution to let him off the hook. I hate to say I told you so. But I told you so.

Look at our economy as a gigantic brain, and the regulatory part that governs all the others has mouldered since, like, 1980, hanging like a withered appendix off the powerful other portions of the organ instead of doing its job. And so people like Bernie Madoff were allegedly allowed to grow and fester.

If the charges against Mr. Madoff are true – and we hasten to add that in our system everybody is innocent until proven guilty! (or gets off using a variety of other strategies) – he was one of the greatest confidence men in history. Confidence men bilk money from other folks by establishing just that: confidence. Mr. Madoff was the head of NASDAQ. He was a man above reproach. He looked peerless in a suit. There was every reason to have confidence in him.

But confidence can’t be established if its seeds fall on infertile ground. The garden in which it grows, located deep within each of its victims, must be tender and soft, turned gently over by the need to believe. It must be watered by greed and warmed by the sun of jealousy and competitiveness. And as we now see, the entire garden itself must be left to sprout whatever it will, untended.

Bernie Madoff told people that he would guarantee their money. Now we look at the poor losers on which he feasted – the charities, the elderly shuffleboarders in Miami, the guys with McMansions in Greenwich whose future now perches on the head of a pin, and we marvel. How could they have been so credulous? Didn’t they know that if it looks too good to be true, it probably is?

Look in the mirror. None of us are any better. Some of us are just luckier. Each of us believed in whatever portion of the system in which we had confidence, and are now being punished to one extent or another.

The only ones who are making out all right are the shorts who never trusted in anything in the first place. It’s a pretty grim world where those are the guys who turned out to be the winners.