Any comments about Mr Madoff?

[tw]

Originally Posted by footfootfoot

At the risk of sounding like tw, the foxes have been regulating the henhouse for a while, and the hens have been thinking "Holy smokes! look at all the corn we've been getting!

So why fear what accurately describes a problem for about a decade now?

Problem in this particular example is information. Currently not clear is whether any regulations existed to enforce. SEC received numerous tips on this particular hedge fund. SEC has been starved for funds for over a decade. Even after Enron, the Congress tried to double the SEC budget and Harvey Pitts refused to accept the money. Not even known if the SEC investigators had sufficient knowledge or experience to see or understand this fraud. All we know is the SEC did investigate this hedge fund previously due to tips - and did nothing.

Did nothing because their people are not smart enough - have enough experience? Or did nothing because the fraud was legal? Well, one would think after LTCM and that massive emergency $billions bailout, then some regulation would exist. Nope.

Instead, the powers in power stifled regulation, refused to increase the SEC budget, and were promoting more deregulation as the solution to our economic ills. What we now know - those ills were created because finance people must be highly regulated. Even Enron accounting is alive and well.