Are the Dominoes Lining Up?

Many people often speak of doomsday prophecies involving horrible fates awaiting the Jews of America. Skeptics answer that such things as befell our people in past countries of residence would never happen in such an accepting place as America which has been better for the Jews than any other country in history (in some cases it could even be argued America is better to its Jews than the modern state of Israel). To this the Doomsdayers counter that the same was said of Germany at the turn of the century, and that the German Jews would never in a million years have seen something like the Shoah coming. Just like by Germany, so too by America (G-d forbid) they say. And just as German anti-Semitism is historically said to have been enabled by great financial hardships being blamed on the Jewish populace, often the Doomsdayers predict that all it would take in America for a similar scenario to play out would be a hard enough financial crisis to hit the USA.

Could the current economic downturn be just the conditions that these prophecies were waiting for? I, for one, am not sure. But I will say this- if ever a scenario were to prove those who made these predictions right, I think this could be the one. Not only are the leading corporations of industry after industry in America failing to keep their heads above water and requesting a share in the government bailout (Al tikra "bailout", elah "handout"), but following the recent headlines Joe anti-Semite could most certainly make an argument blaming it all on the Jews which could be accepted by his average like-minded bigot (or maybe even desperate average American?). Why is this? After the mortgage issue had been looming for quite some time, the world finally woke up to the seriousness of the situation with the headline that Lehman Brothers had gone under. What could have instantly come to the minds of many? "Lehman" Brothers equals Jewish... Lehman Brothers going under somehow equals Jews sabotaging the economy. Now add on to that the latest economic debacle to hit the US economy- a Jewish investor getting caught in possibly the biggest fraud case involving a single person in history, one involving upwards of 50 billion dollars. To add an even more interesting twist, apparently a bulk of his investors comprised some of the top money holders of the American East Coast Jewish scene. So what can be seen so far is that Hashem has arranged it that the wealthy Jews of America are already losing their assets in a big way. What remains to be seen is whether suspicious headlines like this will keep showing up in the news, and if so whether or not Jew-haters will use it as fodder for their propaganda (as well as how well received it will be by the American public). Like I said, I don't want to be shouting that this is for sure doom and gloom, but if ever the Doomsdayers' theories were able to be put to the test, this looks like it's shaping up to to be the chance.

$50 billion at stake after Wall St broker Bernard Madoff is arrested over ‘world’s biggest swindle’

Tim Reid in Washington

Some of America’s wealthiest socialites were facing ruin last night after the arrest of a Wall Street big hitter accused of the largest investor swindle perpetrated by one man.

Shock and panic spread through the country clubs of Palm Beach and Long Island after Bernard Madoff, a trading powerbroker for more than four decades, allegedly confessed to a fraud that will cost his wealthy investors at least $50 billion – perhaps the largest swindle in Wall Street history.

Mr Madoff, 70, a former Nasdaq stock chairman, was apparently turned in by his two sons and arrested on Thursday morning at his Manhattan apartment by the FBI. Andrew Calamari, a senior enforcement official at the US Securities and Exchange Commission, described the scheme as “a stunning fraud that appears to be of epic proportions”.

The FBI’s criminal complaint states that when two federal agents arrived at Mr Madoff’s apartment, he told them: “There is no innocent explanation.” The agents say that he told them “he paid investors with money that wasn’t there”, that he was “broke” and that he expected to go to jail.

Many of his investors came from the enormously wealthy enclaves of Palm Beach, Florida and Long Island, New York, where people had invested billions in Mr Madoff’s firm for decades. He was a fixture on the Palm Beach social scene, and was a member of some of its most exclusive clubs, including the Palm Beach Country Club and Boca Rio Golf Club, where he drummed up much of his business.

The FBI claims that three senior employees of Mr Madoff’s investment firm turned up at his apartment on Wednesday to ask questions about the company’s solvency. Two of them are believed to be his sons, Andrew and Mark, who have worked for their father for two decades.

Mr Madoff told them that he was “finished”, that he had “absolutely nothing”, and that “it’s all just one big lie”. He said the investment arm of his firm was “basically a giant Ponzi scheme”, and that it had been insolvent for years.

A Ponzi scheme, named after the swindler Charles Ponzi, is a fraudulent investment operation that pays abnormally high returns to investors out of money put into the scheme by subsequent investors, rather than from real profits generated by share trading.

The FBI complaint states that Mr Madoff told his sons that he believed the losses from his scheme could exceed $50 billion. If that is the case, his fraud would be far greater than past Ponzi schemes and easily the greatest swindle blamed on a single individual.

There has been scepticism for years on Wall Street over how Mr Madoff managed to pay such consistently high returns. Ponzi schemes inevitably collapse, and Mr Madoff found himself to be no exception. This month, clients asked for $7 billion to be returned, the FBI says.

Mr Madoff ran the scheme separately from his main business and his sons had no involvement in it.

Mr Madoff has been charged with a single count of securities fraud. He declined to enter a plea in Manhattan’s US District Court and was released on $10 million bail. He faces up to 20 years in jail and a $5 million fine if convicted. His lawyer, Dan Horwitz, said that his client was “a person of integrity. He intends to fight to get through this unfortunate event.”

One investor told The Wall Street Journal: “This is going to kill so many people. It’s absolutely awful.” Ira Roth, from New Jersey, said that his family had $1 million invested, and that he was in a state of panic.