A rough count would show that something like a quarter of the business coverage at most financial websites and in the financial sections of newspapers is devoted to the Bernie Madoff matter. The old man did walk off with what is said to be $50 billion of other people’s money. It is endlessly fascinating to figure out how it was done and why it went undetected for so long.
It would be difficult to find something more pleasurable that excoriating the public officials who did not catch on to Madoff’s activities even though a number of people questioned his methods long ago.
Looked at beside the overall problems in the economy here and overseas, the Madoff scandal will be nothing more than a footnote as time passes. Obviously, hundreds of people lost everything. Scores of institutions, including worthy charities, were shut down. In the meantime, the mad genius has been sending jewelry to relatives and hiding money in Swiss bank accounts.
The obsession with Madoff may be due to the fact that people want something to distract them from the daily horror of economic news. If they glanced beyond the headlines about firms in Chapter 11 and job cuts and move to the juicy stories about how a single man was able to dupe both the government and sophisticated investors, the readers may have a few minutes of fun reading about the details of the scandal.
But, the Madoff news is growing old already. Little more can be said. At some point officials may find some of his money or his accomplices. It may come out that another billionaire who invested with him lost everything.
When Madoff was first caught, there was still some glimmer of optimism that a recession would be relatively mild and would end at mid-year. Housing would recover around that time. The unemployment rate might stay below 7%. The government stimulus package and TARP might do their work quickly.
None of those hopes are realistic anymore. They disappeared in a matter of weeks. The fight to keep the US out of the first period of economic depression in over eight decades has moved to the center of the stage.
Madoff does not matter. He never did.
Douglas A. McIntyre
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