From My Perspective - - -
Certain events and experiences occur in one’s life or lifetime that fall into the categories of either having been finagled and/or left flabbergasted. Perhaps both occurred simultaneously. In 2008, when the headline read: “Bernie Madoff's $50 Billion Ponzi Scheme,” investment markets world-wide were both flabbergasted and had the sense of having been finagled. “A Ponzi scheme is a fraudulent investment operation that pays returns to separate investors from their own money or money paid by subsequent investors, rather than from any actual profit earned. The Ponzi scheme usually entices new investors by offering returns other investments cannot guarantee, in the form of short-term returns that are either abnormally high or unusually consistent. The perpetuation of the returns that a Ponzi scheme advertises and pays requires an ever-increasing flow of money from investors to keep the scheme going…The scheme is named for Charles Ponzi who became notorious for using the technique in early 1920 (Wikipedia).”
Forbes Magazine reported at that time, “Brazen fraud ensnares well-known investors and nonprofits and gives hedge funds another black eye. The shocking revelation that prominent investment manager Bernard Madoff's hedge fund, Ascot Partners, was a giant scam will intensify redemptions from scores of other hedge funds that will be forced to liquidate holdings and increase downward pressure on stock prices. This additional negative influence on the market, together with liquidations by mutual funds facing redemptions and endowments facing the need for liquidity, are three significant barriers for optimism about the direction of stock prices in the near term.”
The Forbes commentary summarized the obvious: “The arrest of the 70-year-old Madoff, widely considered to have the magic touch as an investor, is another serious black eye for the hedge fund industry and all non-transparent investment vehicles. Investors across the New York area have clamored to be in Ascot because of the stability of double-digit returns and the reports of serious wealth creation. The scandal is bound to reveal the inner workings of the hedge fund industry, whereby intermediary feeders bring in their clients and take fees for putting clients with an investment manager. If Madoff hadn't faced $7 billion in redemptions, this Ponzi scheme might not have been discovered. What's astonishing is that he got away with it for so long with nobody discovering it. What his four family members in Ascot knew is a puzzle that everyone wants answered, but one thing is certain: It's virtually impossible to have returns like Madoff reported, and it should have been a major warning signal.”
What happened was a classic use of finagling. Finagle means: “to trick, swindle, or cheat; to get or achieve (something) by guile, trickery, or manipulation.” An apt synonym would be conniving – to “plot or scheme.” At the same time, the unsuspecting investors were flabbergasted when the news broke of the massive fraud that had been perpetrated. To be flabbergasted means: “to be overcome with surprise and bewilderment; astounded.” The synonyms are interesting amplifications: “amaze, astonish, stagger, nonplus, confound; perplex, confuse, mystify.”
1 comment:
You said, "The truth is not in the spectacular but through faith and a relationship with Jesus Christ." The Devil is charming. He charmed Eve and Adam, David, and Me, again and again. The older I get, the less I'm impressed by His charm. You are right. I find truth in the Lord Jesus Christ and have a passion to discover and re-cover that truth.
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