A typical Jewish-American success story

The greatest fraud in the history of the US was exposed in December 2008. Bernie Madoff perpetuated a $50 billion ponzi scheme fraud on his formerly wealthy investors. The size of the losses is mind boggling - three times the size of the proposed bailout of the US automakers. His entire investment fund has been a big lie for decades. The immorality of his actions is incomprehensible. Charities have been wiped out, the life savings of entire families have been lost, and innocent lives have been ruined. The potential sentence of 20 years in a country club prison and $5 million fine is not nearly equal to the pain caused by this man’s immoral evil actions. This man was well respected by the Wall Street investment community, a prominent Jewish philanthropist, and part of the wealthy high society crowd located in West Palm Beach. This begs the question, if this man has been running this type of scam for decades, how many more are out there on Wall Street? After a year of never ending tales of scandal, fraud, lies, greed and mismanagement, this episode should be the final straw which convinces the American public the investment game is rigged and they do not have a chance.

This tragedy is a failure of morality, a failure of regulation, failure of unbridled capitalism and a failure of common sense. Bernie Madoff started his firm Bernard L. Madoff Investment Securities in 1960 with $5,000. It started as a classic American success story and is ending as an American tragedy. Mr. Madoff had a spectacular rise on Wall Street. His firm was one of the founding members of the NASDAQ. He emerged as one of the key leaders in the rise of the NASDAQ and eventually became Chairman of its Board. Madoff served as the Chairman of the Board of Directors of the Sy Syms School of Business at Yeshiva University, as well as Treasurer of its Board of Trustees. An college class in ethics in his youth may have benefitted Mr. Madoff’s clients. His firm was one of the top market makers on Wall Street. His estimated net worth grew to between $200 and $300 million. He adapted easily to his rise from humble beginnings to immense wealth. He owns estates in Roslyn, N.Y., Montauk, Long Island, a luxury apartment that occupies the entire12th floor on Manhattan's Upper East Side valued at more than $9 million. He also owns mansions in Palm Beach and France and is a member of the Palm Beach Country Club. He also possess a 55-foot fishing boat named "Bull." After this week’s revelations, it seems appropriate that one of George Carlin’s words you can’t say on TV should have been added to “Bull”. His offices were located in the famous “Lipstick” building in NYC. The building is famous for being shaped like a lipstick case. The building could be considered shaped like a less flattering sexual object, and is more fitting to what Mr. Madoff did to his investors.

Search "The Lipstick Building" on the net.

The words on Mr. Madoff’s website now seem gravely ironic. "In an era of faceless organizations ... Bernard L. Madoff Investment Securities LLC harks back to an earlier era in the financial world: The owner's name is on the door. Bernard Madoff has a personal interest in maintaining the unblemished record of value, fair-dealing, and high ethical standards that has always been the firm's hallmark." It is doubtful that the words “high ethical standards” will grace Mr. Madoff’s gravestone. Even as his ponzi scheme was unraveling, his high ethical standards led him to try and distribute his $200 to $300 million to family, friends, and employees before the victims of his crimes could attempt to recover some of their money. It is too soon to conclude what the long term effects of this scandal will have on our financial system. It is likely that the name Bernard Madoff will go down in the history of ignominy with Michael Milken, Ivan Boesky, Ken Lay, Bernie Ebbers, and Dennis Kazlowski as examples of the most disgraceful behavior in the history of our financial markets.

How can a man live such a Big Lie for decades and sleep soundly at night? Aspects of Theodore Dreiser’s classic novel An American Tragedy are evident in this heartrending story. Dreiser’s theme of the desire to rise up socially and financially in modern America holding the very seeds by which such desires are denied is clearly apparent in this tale of woe. The lure of materialism isn't solely the acquisition of wealth and goods, but the attraction such wealth and goods holds over people, often at the expense of other values. As Mr. Madoff’s success grew, his desire to attain ever higher social status must have led him to take more risk and use illegal means to continue up the social ladder. This overwhelming aspiration for acceptance and accolades in the wealthiest high society of Manhattan and West Palm Beach, led this man to risk everything. The result has been a tragedy of epic proportions. This fraud is reminiscent of the 1938 indictment of the respected former President of the NYSE Dick Whitney for looting his firm, friends, relatives, and charities of millions to fund his high society lifestyle. Those who forget the past are condemned to relive it.

The definition of a ponzi scheme is a fraudulent investment operation that involves paying abnormally high returns to investors out of the money paid in by subsequent investors, rather than from net revenues generated by the business. Mr. Madoff’s investment firm ponzi scheme was incredibly unsophisticated. He was spectacularly successful at marketing his fund to the ultra-rich Jewish communities in New York and Florida as well as Europeans at ski competitions attended by the rich ruling elite. His fund generated returns of 12% to 13% per year consistently for decades. The fund only had five losing months since 1996. The market has had dramatic monthly moves over this time. It is a virtual statistical impossibility for an investor to have such a consistent record through bull and bear markets. Madoff refused to provide his clients online access to their accounts. He sent out accounting statements by mail, whereas most hedge funds email statements and allow them to be downloaded via computer for easier analysis by investors. His books were audited by a three-person accounting firm, Friehling & Horowitz, operating out of a 13-by-18 foot location in an office park in New York City’s northern suburbs. A $17 billion fund could not possibly be audited by one partner and one accountant. These facts were all warning signals that many skeptical investment analysts had pointed out years ago to the SEC and in articles in Barron’s.

It was not topnotch undercover investigating that revealed this fraud. The SEC investigated Madoff’s firm twice in the last eight years and found nothing. Madoff’s son-in-law was an SEC official. The SEC has an annual budget in excess of $900 million and has failed miserably in its mission to protect investors. The oversight of hedge funds has been virtually non-existent during the Bush administration. Again, Alan Greenspan, the patron saint of free markets, proved his prescience in 2000 when he campaigned before Congress to not regulate hedge funds. He described hedge funds as “a vibrant trillion-dollar industry dominated by U.S. firms. They are essentially free of government regulation, and I hope they will remain so. Why do we wish to inhibit the pollinating bees of Wall Street?” These killer bees have contributed greatly to the biggest financial destruction of wealth in history. What are the odds of one man being on the wrong side of every major financial debacle in our country in the last ten years? Mr. Greenspan wins the grand prize again.

What brought down Bernie Madoff was not his guilty conscious, but redemptions of $7 billion from investors that overwhelmed his ability to pay them from new funds. The story that he wants everyone to believe is that he was the only one who knew about the fraud. His brother, two sons, niece, and other family members held high level positions in the firm. It is beyond believability that none of these people knew what was going on. A $50 billion fraud can not be perpetuated by one man acting alone. It certainly appears that as a 70 year old man, he is attempting to shield his family members who should also be spending 20 years in prison. If he was truly remorseful, he would have done the world a favor and taken a swan dive off his 12th floor balcony. Instead, he will hire high powered lawyers, using his phony wealth, to extend his life of luxury secluded in his 12th floor hideaway. This is a man who gives Ponzi a bad name.

Ultimately, Mr. Madoff will be judged by his Maker. A special place in Hell awaits him, next to Hitler, Stalin, and Timothy McVeigh. The victims of his crimes are many. The Robert I. Lappin Charitable Foundation has lost its entire $8 million endowment; The North Shore-Long Island Jewish Health System and the Texas-based Julian J. Levitt Foundation have lost millions; the town of Fairfield, Conn. has seen 15 percent of its retiree pension fund totaling $42 million vanish; Maxam Capital Management run by Sandra Manzke has been wiped out; Tremont Capital Management has lost millions; and thousands more have lost their life savings. A personal story told by Minyanville writer Justin Rohrlich about his grandfather addresses the true heart braking tragedy of this man’s immoral actions.

A personal account from James Quinn

“Last night, it happened to my 88 year-old grandfather Carl. World War II veteran, Captain in the Army, saw combat in the Philippines. His father was a dry-cleaner, his grandfather was a fabric dyer on the Lower East Side at the turn of the century. My granddad was scheduled to go into the invasion of Japan before we dropped the bomb. Instead of going into certain death, he came home and went to the City College of New York on the GI Bill.

Armed with a mathematics degree, my Grandfather eventually landed a job at Neuberger Berman. Became a CFA. Was a director of Tishman Speyer. Helped build Roosevelt Raceway. Ran the pension fund for Price Chopper supermarkets. I had dinner with my grandfather on Wednesday night. Over sushi, he told me about how amazing Bernie Madoff was. This was a common refrain in our conversations. “While the rest of the market is tanking, Madoff is up for the month.” Today, I bought the New York Post on the way to the subway. Bernie Madoff was on the front page. His fund was described as a “Ponzi scheme” that lost $50 billion. My phone rang. It was my mother.

“Your grandfather just lost everything,” she said.”

This blackest of marks in investment history will forever alter the faith that investors have in investment managers, financial advisors, mutual funds, and hedge funds. Americans are being buried under a blizzard of lies. This is truly an American Tragedy.

The Sun Will Set For You
And the shadow of the day
Will embrace the world in grey
And the sun will set for you
Linkin Park – Shadow of the Day

There is a reason old sayings become old sayings. They have an underlying truth that spans the test of time. Some old sayings that apply to our current economic and investment environment are:

If it seems too good to be true, it probably is.
Don’t put all your eggs in one basket.
The cards are stacked against you.

The Madoff affair illustrates that rich people can be just as gullible and foolish as poor people. In their quest for social status and fitting in with the “smart” money crowd, affluent people all over the country put their life savings into the hands of this criminal. No investor can generate positive returns using the same strategy through all market cycles. Warning bells should have been going off. Diversification is the golden rule of investing. The foolishness of these people putting every dime with one man is maddening. Mr. Madoff’s nickname, “the Jewish T-bill”, is fitting today with T-bills providing negative yields.

Another American Tragedy is in the making. A much bigger Ponzi scheme that will shock every person in America is still operating. It is being conducted by the U.S. government and your elected politician leaders. It is called our National Budget. With most of our spending on automatic pilot, the aging of the baby boom generation will put tremendous strain on our economic system in the coming years. As you can see, Medicare costs will explode over the next 40 years. The increasing debt will result in interest payments on the debt becoming the largest expenditure in the federal budget. The longer we wait to address this unavoidable train wreck, the more likely it will result in generational war between the baby boomers and younger generations. Mandatory spending for agriculture subsidies, unemployment benefits, civilian and military pensions and health benefits continues to grow. The ponzi aspect of this system is that we continue to pay out benefits by printing money. We are obligated to pay $53 trillion that we do not have. Social Security has run at a surplus since its inception. The money is not in some lockbox. Your trustworthy leaders have spent all of the surpluses ever generated by Social Security to keep the ponzi scheme going.

A typical Jewish-American success story

Conclusion:

The US is a house of mega scams and ponzi schemes

Minorities protest ban on JuD

Minorities protest ban on JuD

Minorities protest restrictions on suspect charity

Updated at: 0800 PST, Wednesday, December 17, 2008
KARACHI: About 300 members of Hindu and Christian communities demonstrated in Pakistan in support of a Muslim charity accused of being a front for the militant group blamed for the Mumbai terrorist attacks.

Most of the protesters Tuesday in Hyderabad, 110 miles (180kilometers) north of Karachi, were women from Sindh province's Thar Desert.

Bhai Chand, a Hindu community leader, said Pakistani government restrictions recently imposed on Jamaat-ud-Dawa threatened their livelihood because the charity has set up a network of water wells in the desert.

“The charity would always come to help us,'' Chand said. “I do not buy it that they are terrorists when they have always been helping us even though we are not Muslims.''

The protesters carried banners reading, “Are those who give shelter to the shelterless and those who give water to the thirsty terrorists?'' and “Do not ban our savior!''

The government acting after the United Nations declared the charity a terrorist group and a front for Lashkar-e-Taiba, which is blamed for the Mumbai attacks that killed more than 160 people has shuttered all of its offices, arrested scores of activists and put its entire leadership under house arrest.

U.S. Secretary of State Condoleezza Rice said at U.N. headquarters in New York that she understands that “there are so-called charitable activities,'' but that the U.S. “learned the hard way, that sometimes these are too intertwined with organizations that have terrorist ties.''

Gift for Bush from Iraq

Causes of Apsotacy

Some form of apostacy has existed among Muslims. Initially it was nifaaq. The apostates have either hidden it, or at least moderated it if they were living in Muslim societies. Many such apostates even came back to Islam as their end approached.

This does not apply to apostates living in non-Muslim societies. Most there had taken off quietly, falling into sin, and leaving the question of faith unanswered. This is changing now, and a virulent aggressive form of apostacy is being seen, which actively seeks to convert Muslims away from Islam. In addition, there are reports of large numbers of Muslims being enticed away. How far these are true, I cannot say, but some must be happening, particularly in Africa and in the West.

For some time, as you may have concluded from my posts, I have been reading on and researching unIslamic behavior that may be leading to declarations or acts of apostacy from Islam. Here are some of my thoughts. There may be more. I would like others to suggest what other reasons come to their minds. Then maybe we can figure out ways to fight this.

Please also post any links that may be of interest in this regard, particularly if someone has actually researched or some alim has answered this question.

Causes of apostacy from Islam:

1) Belief that Allah is non-loving, while the Christian God is loving, having sacrificed his only begotten son for humanity.

2) Belief that Islam is stern, does not allow fun

3) Love for and expectations of marriage to a non-Muslim man

4) Perceived discrimination of expectations of tolerable behavior from male and female children

5) Peer pressure

6) desire to taste alcohol, dance, gamble, eat non-zabeeha meat etc.

7) tendency in the teens to peel off dress

8) A contemporary desire to avoid conflicts by letting things be, to let everyone believe in what they want without any proselytizing, as this leads to conflicts

9) Hotheadedness and rigidity among Muslims

10) Moral restrictions at home, and consequent rebellion against them

11) Too much strictness, and harshness in punishment for unIslamic behavior. This may include denial of home entertainment like watching TV

12) Too much laxity at home. Sometimes this takes the form of hiding from the stricter parent any behavior that is unIslamic, or protecting the child from a little punishment to drive home the message. Usually it is the mother who does this hiding

13) A clash of values and actual living. For example, a career in movies, singing, or modeling may be considered inappropriate, but movies, pop songs videos, model shows, beauty contests, female swimming or tennis, etc. would be eagerly watched at home by those wanting to enforce these values


14) Another example is being integrated in the interest-bearing economic system, like working in a bank, calculating interest as an accountant or financial consultant, etc. but ruling out the showing of skin or beauty

15) I have this somewhere. I offer it for evaluation as a possibility:

When an honest complaint is made and no method of repair or redress is made possible; it is the party who disables the debate who CAUSES the Apostasy.

Indian Fighter planes probe Pakistan defences

As usual, the kuffar say something, and do something else.

The Indian Foreign Minister says India has no intention to attack Pakistan.

Despite Pakistan government's capitulation to US ad Indian designs, due to which it is fighting the very people committed Pakistan's defence, two violations of Pakistan's airspace by Indian fully armed planes took place today - one from Indian occupied Kashmir and the other from Lahore sector.

They had intruded four kilometers inside Pakistan before being confronted by PAF.

Pakistan Air Force fighter planes intercepted them and they were forced to flee back.

In the Arabian Sea, explosions have been heard. Some additional naval activity and these explosions in the present context are meaningful. However, no large scale mobilization of the Indian land forces has been observed so far.

India has been unable to contain the terrorism by 35 separatist movements. The Indian local terrorists are in control in Gujarat. Indian army serving Colonel has been arrested for supplying arms to these Hindu fundamentalist terrorist organizations, but that is being put on the back burner and instead, India is blaming Pakistan so as to divert local opinion from its failures and to put Pakistan under pressure.

The Indian media has not played a sensible part. It has raised the temperature and pressure on the Indian government to be a war hawk.

Airspace violation by armed planes is a very, very serious thing to do. Coupled with the Arabian Sea explosions, India is embarking on the path to war, and that will benefit only war mongers.

As of today, suppliers to NATO have stopped plying their vehicles to Afghanistan.

prove the case against Jamaatud Dawah

Pakistani government, succumbing once again to non-Muslim pressures, has banned Jamaatud Dawah and sealed all their accounts and offices, arresting many of its office holders, leaders and activists.

The UNSC has banned four individuals of JD. The interesting bit is that one of those banned, Haji Muhammad Ashraf, died six months ago.

The other interesting bit is that no evidence of involvement of JD or its leaders in terrorism has been provided. India keeps saying that evidence of their involvement has been found, but that evidence does not see light. Obviously this is just pressure, and the Pak government, always eager to please its non-Muslim masters, dances to their tune.

Just half an hour to one hour ago, Fazlur Rehman, chief of JUI has asked the same question. Where and what is the evidence

of false gods and goddesses

This is in response to the slogan raised in a mosque:

Jaey Hind

India's Muslims hope to avoid backlash

ERIKA KINETZ
AP News

Dec 08, 2008 14:39 EST

The cleric stood before dozens of bearded men who had gathered on a crowded Mumbai street corner to honor the 171 people killed by Islamic militants.

"Many innocents were killed by these terrorists," said Ibrahim Tani, president of the Muslim Council of India. "Those who were martyred are our family."

The men raised their fists in the air and cried out: "Long live mother India!"

The speech was part of an aggressive campaign by Mumbai's Muslims to show their solidarity with India's Hindu majority in the wake of last month's attacks.

Muslim groups have held community meetings and peace marches, brought tea and cookies to hospitalized victims, and organized blood drives. Leaders have asked people to tone down festivities for the Muslim holiday of Eid, and the city's largest Muslim graveyard refused to bury the nine slain gunmen.

India has a history of Hindu-Muslim tensions that at times erupt into violence. Mumbai itself was the scene of riots in 1992-93 that claimed at least 900 lives.

Soon after, a terrorist attack in Mumbai killed more than 250 people — an attack the government says was masterminded by Muslim gangster Dawood Ibrahim. He was one of 20 suspects that India asked Pakistan to hand over last week. Pakistan denies that Ibrahim is in its country.

More recently, Hindu mobs killed 1,000 Muslims in the state of Gujarat in 2002 after Muslims were accused of burning a train car full of Hindus. Who set the train on fire has never been established.

"Whatever happens in India, everyone is pointing at Muslims," said Parvez Khan, who runs a shoe shop on Muhammad Ali Road, a heavily Muslim neighborhood in Mumbai. "Even if Mother Nature does anything, we are blamed. So far, everyone is blaming Pakistani Muslims, not Indian Muslims."

He fears that distinction could easily blur. "When you go to sleep and get up the next day, it's always a new thing," he said.

A few doors down is a bakery where police gunned down five Muslim workers in the 1992-93 riots.

"Times are bad. The whole world is in chaos now," said a man sitting at a table outside, drinking sweet milky coffee. He would not give his name for fear of stoking tensions. "We really want peace and harmony now. You pray for that," he said.

So far, right-wing Hindu groups, which have targeted Muslims and other minorities in the past, have directed their ire abroad over the attacks.

"Pakistan is responsible, definitely. Internal security we are not concerned about at all," said Shishir Shinde, a spokesman for the Maharashtra Navnirman Sena, an offshoot of the Shiv Sena, a Hindu fundamentalist group.

Neelam Gorhe, a spokeswoman for the Shiv Sena, said India's own Muslims were victims of the terror attacks. "There is going to be a united reaction to the terrorists," she said. "People who died were also Muslim. Why should there be a reaction against Muslims?"

The government's early fingering of Pakistanis as the likely culprits has helped take the heat off India's Muslims, said Arzu, the newspaper editor.

"Had there been some confusion as far as the identity was concerned, things might have been different," he said.

Arzu added that he has seen a list of the dead and about a quarter were Muslims.

Across from him sat Sayyed Mazhar, his left hand bound in a bright blue cast. Mazhar said he was shot outside Mumbai's main train station on the first night of the attack. His friend, he said, was shot in the thigh. He held up a wad of bloodied 100 rupee notes with a bullet hole at the center pulled from his friend's pocket.

"The anguish is ours, too," Arzu said.

_____

A few miles to the south, thousands of protesters thronged outside the burned-out Taj Mahal hotel, setting up candlelight shrines and calling angrily for political change and war with Pakistan.

One man held a sign that read: "Terrorism doesn't have a religion ... Or does it?"

I too hope that a backlash is avoided.

I hope that there is peace and justice on this earth, because peace means that we can do Dawah, and then more people will come to Islam.

I too, and generations of my family before me, from both paternal and maternal sides, were born and are buried in India, Delhi to be precise, although we do not turn the graves into permanent places like tombs etc. The graveyards are turned over after 40 years, to make space for new burials.

I too, have a great deal of love for my land, my country, my people.

But this is where I stop.

From time immemorial the land where one is born, or where one has been nourished, has been referred and revered as Motherland. Just as one would not want to hear any abusive comment against his mother, one does not like to hear anything against one's Homeland/ Motherland/ Fatherland.

In time, this took the form of a goddess - just like Nature is a goddess to some, their countries, especially if the land has had a name from a distant past, is a goddess to them.

Bharat Mata is such a goddess.

My country, my nation, my sect, right or wrong, are such goddesses.

Muslims have succumbed to pressures and fallen to such goddesses.

Our countries, our nations, our ethnicities, our tribes, all these are for identification alone.

Unfortunately, familial or tribal affinity was a rallying cry soon after the Prophet's (saw) death. Then ethnicity, sect, became goddesses to some of us. We were divided according to Arab, non-Arab. Hanafi, Shafiee, etc. When the Sunnis came together, the shia/Sunni divide remained.

In the First World War, the Ottoman Empire, was broken up by internal nationalities seeking independence. We became Arabs, Kurds, Turks, Hindis, Habashis, and what not. Our ethnicities became our new goddesses. Our lands became our new gods.

A very powerful group of Ulema, whose hatred for the occupying power Britain, made them come so close to idol-worshipping Hindus that jeay Hind, or jeay Bharat Mata became a slogan for them.

The age of nationalism dawned upon us in the twentieth century. Further divisions along ethnicity have now overtaken us.

May Allah protect us from worshipping any false god or goddess.

aameen