I am one of those people who reacts in a way, when encountering a loss, that isn't very popular. If I walk out of a store, for example, with a tall cup of Hot Chocolate, and I trip on a crack in the pavement, and the beverage splatters on the sidewalk, my first inclination isn't to ask, "How do I recover this loss?"
There are a lot of people who would say I should go back in and explain the situation, and hope for a freebie. I wouldn't do that. I would expect to pay. Dunkies, for example, is a business, and I know they are a huge business that could swallow a loss of a few bucks, I don't feel comfortable asking.
That's basically it, really, I don't feel comfortable asking.
I think a lot about Madoff and his victims and would I, in this circumstance, feel comfortable asking. It's a really unique set of circumstances.
As complex as the entire scheme was, and continues to be, there is a very simple underlying explanation for the whole thing:
> Person A decided to invest $$ with a guy named Madoff.
> Person A wrote a big check, and gave it to Madoff.
> Madoff put that money in a series of accounts, and moved on.
> Person B also wanted to invest, and also gave Madoff an even larger sum of $$, since he seemed so nice.
> Madoff took a portion of the Person B $$, and gave it to person A as their fake gain on their investment, so to speak
> This cycle continued until it ended - and $13 billion dollars were lost to thousands of folks.
The money these people thought they had, and by no fault of their own, was really never there. There is 1 person, ostensibly, that is responsible for the loss of their initial investments. This isn't like our Social Security $$ that won't be there when I'm 65, it is something completely different, and we need to find a way to recover it. The profits all these investors thought they had - that $$ never existed. At least we know our $$ exists in a pot somewhere for Social Security, its just being overspent.
So, naturally, everyone is asking for their $$ back. But my question is, who the heck should pay them back for it? You can argue that people should just get their investments back, and I am sure this legally has been argued.
If Person A in my example before gave Madoff $3.5 million 4 years ago, but over the course of the last 4 years saw, on paper, "profits" on that investment to the tune of 2 million, I have a feeling that Person A is asking for a total of $5.5 million back. I would like to think nobody is entertaining that idea, and the 3.5 is the only amount that matters.
But again, where should this 3.5 come from? Is it cold, heartless, and irresponsible to tell them that it cannot, under any circumstance, be recovered? Why is it the responsibility of anyone else, aside from Madoff (and his wife/investements) to recover those he deceived?
How can this logically fall onto the taxpayer, who, of course it would ultimately fall back on to?
Investors were duped, and they were tricked. Is it fair to say that just tripped on a crack in the pavement? There are situations on this earth where nobody can logically be held responsible, and there are times when you have to give an "aw shucks" and move on.
I understand this is about people's life savings, and in most of the cases, I can assume, it isn't about greed, but about providing and being proud of making smart money choices. They were unfairly tricked, and I am truly sorry, but aside from the $170 billion* they are going to take from his Madoff's home and bank accounts, etc, I don't know how else to repay victims.
On a side note, can someone explain to me, or show me a justification, in which Madoff's wife gets to keep $2.5 million? I am baffled that we STILL live in a time where $2.5 million doesn't seem to mean anything to anyone. Why isn't this woman going to jail, nevermind keeping $2.5 million?
It should also be noted I am not an expert on anything, and I could be wrong about every single detail in here. I'm not a journalist, I'm just a dude watching golf on a Friday night who ate too much ice cream.
* I had the wrong total $$ amount in original post, this was edited to be correct...
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