Lessons from Madoff

(Note: I have been called away on a family matter. This post will likely stand for several days. Don’t give up hope. I’ll be back soon with more provocative thoughts. In the meantime, I wish a Merry Christmas to all my loyal readers.)
It didn’t take long for people to say the lesson from the $50 billion scam Bernard Madoff perpetrated on the investment world is that more regulation is needed.
This is from a fund manager in London: “I think now it is very difficult for people to invest in things that are meant to be regulated in America, because they have fallen down in the job.”
Baloney.
There are plenty of lessons from Madoff. Most of them are outlined well in this editorial in the Wall Street Journal. Diversify and be diligent.
Even Madoff’s children, who worked for him, didn’t catch on to the fraud. It’s doubtful federal regulators would have, either.
This guy was amazing. He was the former head of Nasdaq and was universally trusted. He threw it all away on a ponzi scheme.
Heck, he could have bought a Senate seat in Illinois for a lot less trouble.