January 9th, 2009
10:30 AM ET

Real lesson of Madoff case

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2009/CRIME/01/05/madoff.bail.hearing/art.madoff.jpg caption="Bernard Madoff strolls down New York's Lexington Avenue after news of the scandal breaks."]

Allan Sloan
Senior Editor-at-large, Fortune magazine

When stock markets are soaring, people think they're making money because they're geniuses. But when the market tanks - which it always does, sooner or later - people look for villains to blame for their losses.

That brings us to Bernie Madoff, who has become the iconic symbol of the current horrible market and economic meltdown, even though he really had nothing to do with it.

Yes, Madoff sure seems to be a really, really bad guy who ruined lots and lots of lives and should probably be locked up for the rest of his natural days.

But Madoff's misdeeds - or as our lawyers would prefer, his alleged misdeeds - have nothing to do with the market meltdown that has sliced trillions of dollars from our collective net worth.

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Filed under: Economy • Finance • Wall St.
soundoff (4 Responses)
  1. Annie Kate

    I couldn't believe the news last night that Madoff has been spending his house arrest time sending off jewelry and such to his relatives. I hope they all know they will have to turn this stuff over to the courts so that the bilked investors can get at least something back from the fortunes they invested with him. No one said last night how the legal system found out he was doing this – did his sons report it again or what? Neither way Madoff needs to go to jail to await trial and not be in his sumptious, comfortable apartment where he can continue to make it hard for the government to recover anything for the investors.

    January 9, 2009 at 7:27 pm |
  2. Chris B - Grand Blanc, Mi.

    Madoff's a bum and should be jail and I don't mean some white collar jail. However recent times shows wealth does not mean intellegence, never has, never will, just means they have power (but very few actually have brains). Madoff didn't cause the meltdown. It was caused by all the other filthy (anti-American) rich idiots. If it weren't FOR the meltdown he probably would not have been caught.

    January 9, 2009 at 3:50 pm |
  3. JC- Los Angeles

    As Toto showed us in The Wizard of Oz, simply pull back the curtain and the seemingly powerful are just smoke and mirrors.

    January 9, 2009 at 1:42 pm |
  4. Charlotte D

    What a tragedy for those who lost their savings investing with Madoff. However, this brings up the old adage that if it sounds too good to be true, it probably is. And–don't put all your eggs in one basket.

    Based on what I have read it appears that a lot of very smart people put their trust in this guy and handed over tons of money to him with the promise that they would earn huge returns. What did they think they were investing in? What did the statements and agreements look like? As Oprah says–keep your eye on your money and sign all your checks yourself. Or something like that.

    January 9, 2009 at 12:26 pm |