The basic idea was hatched in Beantown:
When Ponzi was released he eventually made his way back to Boston. There he met an Italian girl, Rose Gnecco, who was swept off her feet by Ponzi's charm. Though Ponzi did not tell Gnecco about his years in jail, his mother sent Gnecco a letter telling her of Ponzi's past. She remained with him nonetheless and they married in 1918.
Aahhh... Italian girls don't listen to mamma.
Ponzi canvassed friends and associates to back his scheme, offering a 50% return on investment in 45 days. ... A frenzy was building, and Ponzi began to hire agents to take in money from all over New England and New Jersey. At that time investors were being paid impressive rates, encouraging yet others to invest. By May 1920 he had made $420,000.
Aahhh, when Italian smarts meet cosmic idiocy and sheer greed...
Monday, December 15, 2008
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Richard Spring, a Boca Raton resident and former securities analyst, says he had about $11 million -- or 95% of his net worth -- invested with Mr. Madoff. "That's how much I believed in him," Mr. Spring said.
It's pretty amazing that these seemingly smart investors ignored the central investing 101 cardinal points about eggs in one basket. when greed meets more greed.
In light of the last few months, are there still any fans of deregulation left?
What does this have to do with your bete noire, deregulation? Obviously, there are all sorts of regulations to prevent fraud such as pyramid schemes and Ponzi schemes -- it's "just" a matter of enforcing them. The failure I think is at the agency level -- eg, the Securities and Exchange Commission. These guys are supposed to be the watchdogs, but evidently, they were fast asleep at the wheel. Passing a zillion new regulations will do squat -- how can you regulate out of existence greed, who's been around since Cain? We need better people running those agencies, and stiffer penalties for those mother***rs who are caught red-handed stealing gazzilions. Won't fix everything, of course, but at least get us back on some kind of even playing field, hopefully.
As if on cue, the SEC listened to my complaint, and issued an apology. About time, I'd say.
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