Even really smart people fell for Madoff scheme

[nitro]

"Renaissance Technologies' James Simons Makes A Bad Move And Recommends Madoff"

http://www.streetinsider.com/Inside...A+Bad+Move+And+Recommends+Madoff/4436235.html

If people understood their synthetics, and realized what the equivalent position is to the split strike, they would have known immediately of fraud as soon as the market went down and he reported profits.

There is some talk that if you could see flows from the rest of your operation, you could make this strategy work, but then, where is the Chinese wall?

 

[TGregg]

Quote from nitro:

. . . but then, where is the Chinese wall?

I think you have to go to <A href="http://www.snopes.com/science/greatwall.asp">low Earth orbit to see the wall</a>, but not the Moon.

 

[ipatent]

The smart ones thought he was front running the MM.

The dumb ones thought he was a genius.

 

[Ronin08]

The indifference and apathy displayed by the general public in light of the Bernie Madoff Fraud Case and the devastating damage to the victims plus the gross incompetent failure of the SEC to regulate the biggest most astonish and longest fraud in the history of the US should be unacceptable to anyone watching.

The public should at least demonstrate in masses in front of the Court House or in front of the SEC Building in loud disgust.

ALL Investors in Wall Street and online trading should at least stop trading for 24 hours in sympathy to the victims of this horrendous crime with no precedent and in protest to the gross government failure to protect the common long term investor.

The fact that this indifference to react in mass clearly shows the DECADENCE and Mediocrity that is prevalent in our Society.
Decadent societies are often prosperous but usually have severe social and economic inequalities like ours, to such degree that the upper class becomes either complacent or greedy, while the lower classes become hopeless ignorant and apathetic.

 

[trendlover]

Quote from nitro:

"Renaissance Technologies' James Simons Makes A Bad Move And Recommends Madoff"

http://www.streetinsider.com/Inside...A+Bad+Move+And+Recommends+Madoff/4436235.html

If people understood their synthetics, and realized what the equivalent position is to the split strike, they would have known immediately of fraud as soon as the market went down and he reported profits.

There is some talk that if you could see flows from the rest of your operation, you could make this strategy work, but then, where is the Chinese wall?

Nitro, Simmons recommend the Madoff fund to Stony Brook in 1991. Then in 2000 Simmons is questioning the profit. He tells them to take all the money out, but they only take some money out of that fund. 1991 to 2000 was a bull market. So Simmons saw something wrong when a bear market happened and the fund was making alot of money still.
Did he go to the SEC to tell them what he sees? I am curious.

 

[Rearden Metal]

And now of course we see the gale of widespread support for piling strict new regulations upon the entire hedge fund industry.

Never mind the fact that the existing regulations already in place would have been more than sufficient to expose and imprison Madoff years ago, if only the SEC had bothered to lift a finger when presented with all the numerous red flags in this case.

I suppose they were too busy fucking with decent firms like Tuco to bother with such trivial issues as repeated warnings of multi-billion dollar fraud.

 

[atticus]

Yeah, imagine Simons duped by a synthetic bull vertical spread strategy.

 

[reiser999]

Wealthy traders and investors may be well above average business wise, but that doesn't necessarily make them genius rocket scientists or astrophysicists.

 

[atticus]

Quote from reiser999:

Wealthy traders and investors may be well above average business wise, but that doesn't necessarily make them genius rocket scientists or astrophysicists.

Dr. Simons holds a BS in mathematics from the Massachusetts Institute of Technology and a PhD in mathematics from the University of California at Berkeley. His scientific research was in the area of geometry and topology. He received the American Mathematical Society Veblen Prize in Geometry in 1975 for work that involved a recasting of the subject of area minimizing multi-dimensional surfaces. A consequence was the settling of two classical questions, the Bernstein Conjecture and the Plateau Problem. Dr. Simons’ most influential research involved the discovery and application of certain measurements, now called the Chern-Simons Invariants, which have wide use, particularly in theoretical physics.

 

[reiser999]

Quote from atticus:

Dr. Simons holds a BS in mathematics from the Massachusetts Institute of Technology and a PhD in mathematics from the University of California at Berkeley. His scientific research was in the area of geometry and topology. He received the American Mathematical Society Veblen Prize in Geometry in 1975 for work that involved a recasting of the subject of area minimizing multi-dimensional surfaces. A consequence was the settling of two classical questions, the Bernstein Conjecture and the Plateau Problem. Dr. Simons’ most influential research involved the discovery and application of certain measurements, now called the Chern-Simons Invariants, which have wide use, particularly in theoretical physics.

Touché, but he is still one of many.
Remember LTCM.