Filling up space and time

I'm just writing this to kill time and fill up some space. It will be the last post of 2013. 2013 was definitely not the best year on record - too many bad things happened. If you keep up with the news, you know what I mean. We didn't find the Forrest Fenn treasure either. 

Hidden Treasure Found

I believe I have figured out where Fenn's hidden treasure is. Please see the previous post for more information on this. It was all a very interesting and delightful intellectual exercise. Now, I must get my ass over there and collect it, so to speak. 

Accessories to crime

It is not easy to carry out a crime all by yourself. You might be able to plan it, but executing the plan is a very different matter. David Friehling was Bernie Madoff's auditor for 17 years - 1991 to 2008. He recently pleaded guilty to securities fraud but he also said he was never aware that Madoff's business was a Ponzi scheme. Really? How can an auditor be that dumb? He saw the unrealistic gains did he not? I once asked an auditor (CPA) how it was that Mexican politicians could steal millions and get away with it, when they were audited year in and year out. His explanation was simple: the auditors were in on it. It could not be otherwise. It's a good thing this topless woman doesn't have to worry about such things - her husband provides well for her I'm sure.

Cheating is Fun

From a recent Yahoo! News story: “SAO PAULO – The founder of one of Brazil's biggest evangelical churches siphoned off billions of dollars in donations from his mostly poor followers to buy jewelry, TV stations and other businesses for himself, authorities charged Tuesday. A Brazilian judge accepted charges from prosecutors alleging that Bishop Edir Macedo and nine other people linked to the Universal Church of the Kingdom of God committed fraud against the church itself and against its numerous followers. Sao Paulo state's prosecutor’s office alleged in a statement that Macedo and the others took more than $2 billion in donations from 2003 to 2008 alone, but charged that the alleged scheme went back 10 years. Prosecutors said the Universal Church of the Kingdom of God receives nearly $800 million in donations every year from faithful in 4,500 temples across Brazil. The church claims to have nearly 8 million followers in Brazil and many more around the world. Prosecutors said the church tells its members it needs donations — cash, checks, cars and other goods — to finance new temples and to pay for religious programs on radio and TV. The church allegedly used fake companies to launder the money, moving the assets abroad and then returning them in the form of loans used by Macedo and his accomplices to buy businesses, prosecutors said. Macedo, who founded the church in 1977, owns a large television network, three newspapers and several radio stations. He also owns a tourism agency and an air taxi company.” If one wants to be unjust and corrupt, there is no better place to hide than behind the cloak of the church. Some church ministers are no better than most politicians. Who can stop them? Nobody.

Justice

From an internet news story: “BEIJING – China executed two businessmen for defrauding hundreds of investors out of more than $127 million, calling the scam a serious blow to social stability, state media said Thursday. China puts to death more people than any other country, although last month a high official for the Supreme People's Court, which reviews every death sentence, said the punishment should be used more sparingly. Though usually reserved for violent crimes, death sentences are also applied for nonviolent offenses that involve large sums of money or are seen to threaten social order.” I only have one question: If these men knew they could be executed for stealing large sums of money, why did they persist? And why didn’t they just get out of China and go hide somewhere? And, if they were so good at persuading people to let go of their money, why didn’t they come work in the U.S.? Here, you get about five years for a little crime like that. And the prison food is terrific, along with the minimum security accommodations. Our model has no opinion about this - she is just enjoying her tanning time. Please.

What Poverty???

From a New York Times article: “Poor people have I.Q.s significantly lower than those of rich people, and the awkward conventional wisdom has been that this is in large part a function of genetics. After all, a series of studies seemed to indicate that I.Q. is largely inherited. Identical twins raised apart, for example, have I.Q.s that are remarkably similar. They are even closer on average than those of fraternal twins who grow up together. If intelligence were deeply encoded in our genes, that would lead to the depressing conclusion that neither schooling nor antipoverty programs can accomplish much. Yet while this view of I.Q. as overwhelmingly inherited has been widely held, the evidence is growing that it is, at a practical level, profoundly wrong. Richard Nisbett, a professor of psychology at the University of Michigan, has just demolished this view in a superb new book, “Intelligence and How to Get It,” which also offers terrific advice for addressing poverty and inequality in America.” How dumb can anybody get? I.Q. is only part of the poverty issue. There are lots and lots of poor people who are very intelligent. There are also lots and lots of rich people who are very dumb. A person can marry money and can also inherit money. They can also win the lottery. Poverty is concentrated among nations whose people are generally (1) inactive; (2) don’t have a cohesive society, (3) do not enjoy good health, and (4) unimaginative. (1) If you stay put all day (if you are inert) you will find that money will not fall down on you from the sky. (2) If you live in a society where people are adversaries and do not work as a family group, where there is no sense of community and belonging, then achievement and progress become almost impossible. (3) If you live in a society where people die young, you will find people struggling simply to stay alive and a life that could be productive for 70 years is simply productive for 30 or 40. (4) If people work hard and live long and work well together but have no imagination, they will also not prosper as much. Education is part of the solution but certainly not all of it. This article in the New York Times is just an effort to sell more books.

Madoff again

From a Yahoo! News story: “Madoff pleaded guilty Thursday to 11 charges, including fraud, perjury and money laundering, in what could be the biggest swindle in Wall Street history. He faces a maximum sentence of 150 years in prison, and the judge immediately jailed him. In arguing for his release, Madoff's lawyers say they would have a difficult time preparing for his sentencing without the ability to see him frequently to review his finances. They say they expect Madoff will be kept in solitary confinement, with limited contact with his lawyers, at the Metropolitan Correctional Center in Manhattan. They point out that Madoff did not flee after his December arrest, even though he "was always cognizant of the fact that he would die in prison." All of this was avoidable. Why does a swindler swindle anyway? Because it's so much fun? A game, perhaps?

The few

There is some sort of pattern about this. Cortez conquered more than 300,000 Aztecs with 400 Spaniards and a few thousand Indian mercenaries. Enron was brought low by the actions of fewer than a dozen men. President Nixon resigned and caused a crisis after the Watergate mess planned by a few men. Bernie Madoff caused the collapse of several financial entities by paying out much more than he was taking in, losing 30 billion in the process. Now, Wall Street has collapsed and many banks are insolvent due to the actions of a handful of men. The national economy is in dire straits because a few men thought there was no end to the flow of good money available for bad investments. What next? Will crops fail, too? Are the farms in the hands of a few? Pictures at 11:00.

Madoff

This is about nothing - I am just writing this to poke fun at Bernie Madoff. He has become a celebrity by cheating people and being untrue to himself - a big fraud. A fake. An impostor. A cheater. A thief. A pretender. More unreal than a three dollar bill. It does not bother him because he can justify himself to himself. If he ever in his life dressed as Santa Claus, he looked like this guy. I never had any money with him - not rich enough. Don't pity his clients - they were just greedy fools.

Santa Claus

Here’s a photo of Bernie – Bernie Madoff, that is. He looks in good spirits, though they say that at the time the picture was taken, he already knew he was in deep trouble. Looks can be deceiving, no? He could almost pass for a guy I met at the Detroit Yacht Club many years ago, when it still existed. Pretensions are among the most useless things around, except to a con artist. They say he used to be fastidious and obsessive – nothing but the best for him. I wonder if his family knew he was just a fraud – as fake as Santa Claus. Judging from this photo, he would probably have made a good Santa Claus. I don’t really know.

Who knew??

A Congressional hearing into the workings of the S.E.C. is scheduled soon. People want to know how it was the S.E.C. failed to heed warnings about scammers on Wall Street. Were these smart people just duped??? I don't think so. I believe they chose to look the other way, just like Enron's auditors. Remember them (Arthur Anderson.)? Remember the Kansas City building inspectors and the New York City building inspectors who ignored problems in structures that later failed? Same thing. I once asked a CPA friend how it was that Mexico enjoyed such a high level of corruption in government if the books were audited? His response: "The auditors are in on it." OBVIOUSLY. This woman is looking the other way, but I'm pretty sure she's not an auditor.

Impure gold

This sounds very fishy to me: “Chris Weber, the editor of the excellent Weber Global Opportunities Report, makes the calculation in the most recent issue of his newsletter. He adds up the value of all the paper money in the world... and comes up with $100 trillion. Then he divides this by the total amount of "above ground" gold in existence – 5 billion ounces – and finds a fair value of gold at $20,000 an ounce. If Chris Weber's calculations are correct, the gold price would need to rise about 22 times to match the rise in the quantity of paper money in the system.” So, the question is, why aren’t all the other precious metals factored in???? This must be pure baloney. Gold is at about $850 an ounce right now (today). PLEASE. Even the girl at left knows better. Gold is not edible, remember?

I.O.U.S.A. what???

From an ad I recently read: "At last, here's how you can own the award-winning I.O.U.S.A. documentary FREE on DVD... over a month before it's even available to the general public! It's my gift to you, and it's also just the beginning of what you'll get in our new "Emergency 'Personal Bailout' Bundle" — also FREE — which shows you... What a sham the bailout is, how we got here, and what happened to the America we used to know. How to rescue your retirement with up to 78 personal "bailout" checks instead, paid direct to your account over the next 24 months. And how to salvage the financial security of your children, your grandchildren and America itself." So, you think this is free??? Nope. Nothing is free. If you follow the ad until the very end - it is extremely long and wordy and repetitive and wordy and long (written for persons who have nothing better to do), you will discover that you will be pitched a report on how to get out from having to pay taxes to support the government. If you don't pay taxes, how will that salvage the financial security of America? It is sad and funny at the same time. I don't see the girl on the left laughing. She is sort of asking something like "What's all this about?"

Timid Reporter interviews Bernie Madoff

The Timid Reporter sent me this interview. Judge for yourself. (Any similarity to persons actually living or events actually happening is coincidental, he said)

TR: Good afternoon. Are you Bernard L. Madoff?
BM: Yes, but you don’t have to be so formal – call me Bernie, please.
TR: Yes sir. May I come in?
BM: Sure. Make yourself comfortable. I’ve been expecting you.
TR: It smells like apple cider in here.
BM: I hope you find it pleasant my friend.
TR: Yes, very pleasant.
BM: I would offer you some but I’m afraid we’ve run out of Styrofoam cups.
TR: Why not use a real cup?
BM: My wife won’t let me.
TR: Well, I drink beer anyway.
BM: Beer is bad for you.
TR: Not so far.
BM: Why do you say that?
TR: I’ve been drinking beer since 1798 and have not been badly affected.
BM: Is that so?
TR: Yes sir. I only stay away from dark ale.
BM: That’s very amusing although a little perplexing too because I know you can’t be conning me – I would be able to tell, you know. You don’t look more than forty years old.
TR: I suspect that’s probably true. You are a very shrewd and wise man.
BM: I know how men think and what they crave the most.
TR: You would have made a good psychologist.
BM: On the contrary – I think I would have made a good politician. A psychologist is easily fooled. A politician only pretends to be fooled – a politician is the greatest deceiver of all. He is the master of the ancient art of manipulation.
TR: Mr. Bloomberg might not appreciate your saying that about him.
BM: I can always say I was misquoted.
TR: But my readers know I’m very careful.
BM: Sure, but he’s not one of your readers. What are people saying about me anyway?
TR: That you’re a schemer, a deceiver, a thief, a fool, a fixer, a flake, and a fraud.
BM: Well, that’s not too bad though I don’t really care what people think. I only care about what my own family thinks.
TR: They are the ones who said it. It’s in The New York Times.
BM: How can they be so ungrateful?
TR: The New York Times?
BM: No, my sons.
TR: …Ruth and your sister and your niece, too.
BM: Well, shame on them for kicking a man when he’s down - a poor elderly man.
TR: Do you think you’ll end up in prison?
BM: You mean, die in prison? Of course not. What do you think lawyers are for? By the time we get done with all the appeals, I’ll be ninety five. I just hope they can save my licenses. I might go work at Merrill Lynch or Bear Stearns or Lehman - as a partner, of course.
TR: They no longer exist.
BM: What are you saying - since when?
TR: About four months ago.
BM: Are you serious? What is this world coming to?
TR: I think they went bankrupt.
BM: I remember hearing something about it. You know, I haven’t read much in the last three years – not even the financial papers. I simply haven’t had the time.
TR: What have you been doing?
BM: Doing? Doing a lot of bookkeeping, that’s what I’ve been doing.
TR: Didn’t you have people doing that for you?
BM: They couldn’t be trusted with the Ascot accounts.
TR: A lot of your friends are angry with you.
BM: How come they weren’t mad at me when I was making them a ton of money? Do they expect me to apologize?
TR: They want their money back.
BM: Sure, sure, everybody does. Don’t they realize that asking for their money back is what caused this whole enterprise to collapse in the first place? It was like a run on the bank. I warned them. Don’t cash out, don’t cash out – wait for a scheduled distribution. Be patient. Instead, it was like a stampede of wildebeest.
TR: Didn’t you at least have a few billion left?
BM: Sure I did, but I had to pay as many people as I could before word got out that I was insolvent.
TR: Who?
BM: My closest friends.
TR: Like who?
BM: Let’s just say Bloomberg, Trump, Schumer, and Kennedy got taken care of.
TR: …Because you didn’t want to cross them or what?
BM: No, I didn’t. They’re a mean bunch – more cold-blooded and ruthless than I am, especially that Caroline girl.
TR: What about Clinton?
BM: The Clintons took their money out two months ago - even Chelsea.
TR: Maybe they knew something….
BM: Of course they knew – everybody knew. Nobody’s that dumb.
TR: And the SEC auditors?
BM: They were somewhat incompetent, but I also think they had their doubts - you know how the government is – if you have enough clout, you have nothing to fear from them. I just told them that if they wrote me up I would go above their heads. They wrote their reports full of imprecise and equivocating double talk – you know, maybe this and perhaps that; it appears that and it seems like – really vague stuff, nothing you could sink your teeth into. Naturally, the upper guys let me off the hook every time. There was a lot of gray in those reports. I also let some of the SEC higher ups invest with me.
TR: Really?
BM: Sure. Would I lie about something like that?
TR: How did you fool the sophisticated investors and hedge fund managers?
BM: Easy.
TR: How?
BM: Look, let me give you an example. I’ve been around financial jargon all my life. I know how people react to it. When they don’t understand it, they get frustrated and would rather be gored by a bull than be made to feel dumb. I will give you an introduction to my investment strategy and you tell me when to stop.
TR: Ok.
BM: Typically, a position in an Ascot Partners account will consist of the ownership of 30 to 35 S&P 100 stocks, most of them correlated to that index, the sale of out-of-the-money calls on the index, and the purchase of out-of-the-money puts on the index. The sale of the calls is designed to increase the rate of return, while allowing upward movement of the stock portfolio to the strike price of the calls. The puts, funded in large part by the sale of the calls, limit the portfolio's downside or risk ratio. A simple split-strike trade involves buying a stock at price X, selling a call option with a price Y which is above X, and purchasing a put option with a strike price Z which is below X. If the price of the stock is above Y at expiration, the stock will be called away and the investor receives Y for the stock. If the price is below Z at expiration, the put can be exercised and Z received in cash. This effectively caps the maximum gain….
TR: Stop. Please.
BM: I could go on like that for hours.
TR: I believe you.
BM: So the idiots would just say to me: “Bernie, don’t bother to explain all this to us, we trust you, you’re a genius, just send us any gains.”
TR: Do you have any words of advice for my eight readers?
BM: Tell them they’re lucky to be poor.
TR: Thank you Bernie.
BM: Thank you my friend and sorry about the cider.

Too good to be true

By now, most of you have heard of Bernie Madoff - the big-time con man from New York. He was never an investor or fund manager - he was and is a thief. He's the guy who played a gigantic Ponzi scheme game against hundreds of investors - many of whom should have known better. It's like they say - greed and charm will get you every time. When it's too good to be true - it's too good to be true. Now is a little too late to be wanting to be safe. The building to the left is the lipstick building in New York, where Bernie had his offices. Impressive, no? That's why I always say, invest conservatively. Buy lots of stock now, but do it wisely. Where Madoff is concerned, there are no high hemlines - sorry.