Thursday, 16 July 2009

Madoff was an amateur

As everyone in the known universe is probably aware by now, the Ponzi Prince Bernard Madoff got done good and proper after he done loads of investors good and proper.

The disgraced financier Bernie Madoff has been sentenced to the maximum 150 years in prison for masterminding a $65bn (£38bn) fraud that wrecked the lives of thousands of investors.

He was a naughty boy to the be sure. Here is Wikipedia's description of a Ponzi scheme.

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 offers returns that other investments cannot guarantee in order to entice new investors, 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 in order to keep the scheme going.

Madoff ran an op like this to the tune of £35 billion. Not a bad little scam. But that really is small fry.Madoff may be the Ponzi Prince, but the 'King' is undoubtably HM Government. DK puts it in context;

However, as I have consistently pointed out, Madoff's fraud is nowhere near the scale of the British governments' National Insurance—which has been running since 1911 and will defraud "investors" of some £104 billion this year alone [PDF].

Difference is, Madoff's investors could choose to invest (unlike us), and that £35 bn was over the course of 20 years or so.

Please read the rest of the article for lots of details on just how very fucked up it is, especially when the government is telling people they'll have to cough up £20,000 for care in old age. They call it 'care insurance'.

Well unless I'm missing something, what the fuck are NI contributions for then?

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