February 27th, 2009
09:30 AM ET

Serwer in 'Shopaholic' movie

We heard a rumor that Fortune Managing Editor Andy Serwer makes a cameo appearance in the movie, 'Confessions of a Shopaholic.' We tracked it down...check it out.

Filed under: Andy Serwer • Behind The Scenes
December 16th, 2008
06:09 PM ET

Madoff scandal: Did the SEC blow it?

Editor's Note: These are quick notes from Fortune Magazine Managing Editor Andy Serwer. See Andy's full report on AC360° tonight at 10pm ET.

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/images/12/16/art.bernie.madoff.jpg caption="Bernard Madoff leaving his home on Dec. 15, 2008."]

Andy Serwer
Managing editor FORTUNE

  • It’s unclear how many times the SEC was flagged but it was flagged more than once on Madoff and took no enforcement action. This is not a small thing – the SEC has gone after smaller operations and closed them down. There are some suggestions that Madoff was friendly with people in the SEC and it's unassailably true that because he was a former NASDAQ chairman, it could have predisposed people to say that this guy couldn’t have been bad.
  • As far as smaller operations, the SEC spent a lot of time and money going after Mark Cuban for insider trading. It's a tiny amount – he avoided losses of $750,000. I'm not saying what Mark Cuban did was right but it's ridiculous that they're spending time and money going after this guy for $750k but were flagged numerous times essentially on one of their own and really did nothing. They spent countless man hours on Cuban and partly it’s because he’s an outsider to Wall Street and not liked by a lot of people in general because he’s brash, etc.
  • Every scandal is the same and every scandal is different. This is the Mother of all scandals. True to form, Madoff seems to be wrong even on how much money is lost because he said $50 billion and it's probably more like $20 billion. He couldn't even tell the truth about how much money was stolen.
  • Wall Street never learns. The bull market brings out the crooks and the bear market is when they get caught. What happens in a ponzi scheme, people start pulling money out and you can't get new investors and the house falls apart.
  • Fortune.com has another story about a guy named Richard Whitney. In 1929, he served for 5 years as President of NYSE, supposedly halted panic in the 1929 crash and ended up being guilty of fraud. In other words, he was part of the club on Wall Street and not guarding hen house, he was stealing from it.
  • I actually talked to a shrink about Madoff today and the shrink said 3 things: 1. He's narcissistic; 2. He suffers from delusions of grandeur; 3. He was psychopath.
  • He's a very peculiar person. Usually these people prey on people they don't know. He preyed on weakest people in society and went after charities of people he believed in. He may have fallen into this. He probably got behind one quarter and he fudged some figures to cover it and it snow-balled. He might not have started out as a crook but turned that way.
  • How did he fool investors? Same thing that fooled the SEC, fooled investors. People said this is a former NASDAQ chairman, returns are good but not through the moon. His returns were just good enough to be a good investment but not so much to be implausible.

See all of Andy's columns at Fortune.com.

Filed under: Andy Serwer • Finance
December 15th, 2008
12:12 PM ET

Madoff investor: "Will I ever see any of my money again?"

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/images/12/15/art.fraud.jpg]

Andy Serwer
Managing editor FORTUNE

Now that the Madoff fraud has been exposed there are still a slew of fundamental questions outstanding.

How did one man, Bernard Madoff, run such a massive, self-described Ponzi scheme? Is it really true no one else was involved? How much money has really been lost? Is it $50 billion? And even if it is only several billion, how does someone burn through that much cash? Where did it go?

And then there's the heart-breaking question one of my elderly neighbors - a Madoff investor - asked me: "Will I ever see any of my money again?"

I have no idea, I told her sadly, maybe you'll get some, but you should assume that it's all gone.

Of course there are thousands of stories like my neighbor's. It's outrageous that someone like Bernard Madoff - a former NASDAQ chairman - could operate such a vast conspiracy right under the noses of the regulators.


Filed under: 360° Radar • Andy Serwer • Bailout Turmoil
December 10th, 2008
01:04 PM ET

Bad news for newspapers

Program Note: Look for Andy Serwer talking about economy on tonight’s AC360° at 10pm.

Andy Serwer
Managing editor, Fortune

In this video clip, Fortune's Andy Serwer says that the print media is struggling with increasing Internet competition.

Filed under: Andy Serwer • Economy • Internet
November 13th, 2008
10:48 PM ET

Once and future Treasury Secretary?

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/images/11/08/art.bopt1108.gi.jpg]Program Note: Look for Andy Serwer talking about the housing crisis on tonight's AC360 at 10pm.

Andy Serwer
Managing editor, Fortune

There has been much talk of whom President-elect Barack Obama will name as his Treasury secretary. The guessing game on Wall Street and in Washington, serious stuff even before the election, has become even more intense.

A job that was once a good part ceremonial – with the ultimate perk being your signature on the nation's currency – has become full-time serious. The new Treasury secretary is probably Obama's most significant appointment, and arguably the first significant decision the next president will make.

Fortune believes that former Treasury Secretary Lawrence (Larry) Summers is in the lead to get the job. Summers, who served in the Clinton Administration, wouldn't be a surprise pick. He along with other economic experts, ex-Treasury Secretary Robert Rubin and former chairman of the Federal Reserve Paul Volcker, have advised Obama during the campaign, especially as the economic crisis unfolded. Volcker is said to be highly interested in the Treasury job, but Summers, with support from Rubin, has the inside track.


Filed under: Andy Serwer • Bailout Turmoil • Barack Obama • Economy • Raw Politics
October 13th, 2008
10:25 PM ET

History can get us out of this mess

Fortune's Andy Serwer says the FDR administration's actions can show officials how to handle the current economic crisis.

Filed under: 360° Radar • Andy Serwer • Bailout Turmoil • Economy • T1
October 13th, 2008
04:38 PM ET

What right wingers mean when they call Obama a "socialist"

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/images/09/23/art.obama.mccain.split.jpg]Adam Serwer
Writing Fellow, The American Prospect

Right-wing attempts to paint Barack Obama as a socialist aren't just disingenuous. They're rooted in a history of conservative smears against black leaders.

On Saturday, Georgia Congressman John Lewis went nuclear on John McCain, releasing a statement that seemed to compare McCain to segregationist George Wallace. "George Wallace never threw a bomb," Lewis wrote. "He never fired a gun, but he created the climate and the conditions that encouraged vicious attacks against innocent Americans who only desired to exercise their constitutional rights." The civil rights icon continued, "Because of this atmosphere of hate, four little girls were killed one Sunday morning when a church was bombed in Birmingham, Alabama."

Lewis accused McCain and his running mate Sarah Palin of "sowing the seeds of hatred and division." He was referring to the angry tone of recent McCain rallies, where cries of "kill him" and "off with his head" have made many people anxious about the potential for violence against the Democratic nominee.

It's no wonder that the tone at McCain rallies remind Lewis of the bad old days. In recent months, conservatives have sounded increasingly retro with their attempts to paint Obama as a socialist or communist. In some ways, this accusation is typical far-right boilerplate. Obama certainly isn't the first Democrat running for president to be accused of communist sympathies. And as usual, the accusations are rarely linked to policy specifics. But the difference with Obama is that, in the eyes of the right, it's not just his political affiliation that implicates him as a socialist. It's his ethnic background.

Keep reading...

Editor's Note: Adam Serwer is a writing fellow at The American Prospect and recent graduate of the Columbia University Graduate School of Journalism. He also blogs at Jack and Jill Politics under the pseudonym dnA and has written for The Village Voice and the Daily News.

Filed under: Andy Serwer • Barack Obama • John McCain • Raw Politics
September 18th, 2008
10:10 PM ET

How Financial Madness Overtook Wall Street

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/images/09/18/art.vert.wallstconstruction.jpg width=292 height=320]

Andy Serwer and Allan Sloan
Time Magazine

If you're having a little trouble coping with what seems to be the complete unraveling of the world's financial system, you needn't feel bad about yourself. It's horribly confusing, not to say terrifying; even people like us, with a combined 65 years of writing about business, have never seen anything like what's going on. Some of the smartest, savviest people we know — like the folks running the U.S. Treasury and the Federal Reserve Board — find themselves reacting to problems rather than getting ahead of them. It's terra incognita, a place no one expected to visit.

Every day brings another financial horror show, as if Stephen King were channeling Alan Greenspan to produce scary stories full of negative numbers. One weekend, the Federal Government swallows two gigantic mortgage companies and dumps more than $5 trillion — yes, with a t — of the firms' debt onto taxpayers, nearly doubling the amount Uncle Sam owes to his lenders. While we're trying to get our heads around what amounts to the biggest debt transfer since money was created, Lehman Brothers goes broke, and Merrill Lynch feels compelled to shack up with Bank of America to avoid a similar fate. Then, having sworn off bailouts by letting Lehman fail and wiping out its shareholders, the Treasury and the Fed reverse course for an $85 billion rescue of creditors and policyholders of American International Group (AIG), a $1 trillion insurance company. Other once impregnable institutions may disappear or be gobbled up.

The scariest thing to average folk: one of the nation's biggest money-market mutual funds, the Reserve Primary, announced that it's going to give investors less than 100 cent on each dollar invested because it got stuck with Lehman securities it now considers worthless. If you can't trust your money fund, what can you trust? To use a technical term to describe this turmoil: yechhh!


Filed under: Andy Serwer • Raw Politics • Wall St.