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Tom Au, CFA
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In the early 1990s, during the middle of a secular bull market, I began work on "A Modern Approach To Graham and Dodd Investing," that was not particularly suited for the decade of the 1990s, but was ideally suited for the following "Lost Decade" of the 2000s.
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A Modern Approach to Graham and Dodd Investing
  • Should Bernie Madoff Be Given A Jail Sentence He Might Survive? 8 comments
    Jun 23, 2009 10:46 AM

    Bernie Madoff's lawyer is arguing for a 12 year sentence for the convicted scamster. His life expectancy at his age is 12.6 years. Such a sentence would give Madoff a better than 50-50 chance to survive his jail term.

    Given the extent (hundreds of victims) and scope (ruin of many) of his crimes, many of Madoff's victims want him to serve triple digit time. A sentence of 100 years or more probably wouldn't be survived by a newborn babe, let alone an old man. Effectively, they want life in prison for him. Some would take it one step further, and say that he deserves death. But such a penalty is not available for a non-violent crime. 

    A compromise solution, which Madoff's lawyer addressed, would be a sentence of 15-20 years, the kind of penalty that was given to people like Enron's Jeff Skilling, and Tyco's Dennis Kozlowski and Mark Schwartz, which did not take age into account. Then Madoff would be an odds on "favorite" to die in prison, but would have a small actuarial fighting chance of surviving his term. On the other hand, eightyish John Rigas (of Adelphia) has been sentenced to that kind of term, which he probably won't survive. But after serving two years, he can be allowed to return home if and when a prison doctor determines that he has less than 90 days to live.

    The presiding judge, Denny Chin, has a reputation of being a wise judge. What he sentences Madoff to, and why, should be instructive.

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Comments (8)
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  • Ninja Pilot
    , contributor
    Comments (5) | Send Message
     
    Give him the 100 year sentence. He already had the good part of his life in freedom en wealth, while ruining the lives of hundreds of others. Let him die in prison. Sorry, no mercy.
    23 Jun 2009, 11:59 AM Reply Like
  • jflick
    , contributor
    Comment (1) | Send Message
     
    Are you kidding me? Kozlowski and Swartz didn't do anything close to Skilling let alone Madoff. Madoff is in a league of his own. To give him a similar sentence as the other three would be to diminish what he did, which was simply ruin thousands of peoples lives and commit the biggest financial fraud in history.
    23 Jun 2009, 12:54 PM Reply Like
  • Tom Au, CFA
    , contributor
    Comments (6777) | Send Message
     
    Author’s reply » No, just raising the question. It seems that you have answered it, at least for yourself.

     

    On Jun 23 12:54 PM jflick wrote:

     

    > Are you kidding me? Kozlowski and Swartz didn't do anything close
    > to Skilling let alone Madoff. Madoff is in a league of his own.
    > To give him a similar sentence as the other three would be to diminish
    > what he did, which was simply ruin thousands of peoples lives and
    > commit the biggest financial fraud in history.
    23 Jun 2009, 05:33 PM Reply Like
  • Bill Ronaldson
    , contributor
    Comments (11) | Send Message
     
    More people are being charged with their participation in the Madoff scheme: www.newsinferno.com/ar...
    24 Jun 2009, 09:22 AM Reply Like
  • Tom Au, CFA
    , contributor
    Comments (6777) | Send Message
     
    Author’s reply » That's a good thing. More than one person took part. Wonder why his relatives aren't being charged.

     

    On Jun 24 09:22 AM Bill Ronaldson wrote:

     

    > More people are being charged with their participation in the Madoff
    > scheme: www.newsinferno.com/ar...
    25 Jun 2009, 11:09 AM Reply Like
  • Bill Ronaldson
    , contributor
    Comments (11) | Send Message
     
    People who took quick paybacks on their lost investments now want out of that deal: www.newsinferno.com/ar...
    26 Jun 2009, 01:51 PM Reply Like
  • MarketTrader
    , contributor
    Comments (21) | Send Message
     
    Does anybody else see how idiotic these investors were??

     

    ...I mean, aside from the elephant in the living room, who the hell invests their SAVINGS in a HEDGE FUND?! Savings are intended to stay in a savings account or bank CD and earn interest.

     

    I basically think that if you're dumb enough to believe some "too good to be true" story or if you take your savings and invest it in a very risky asset class, whatever happens is your own fault. You're not completely blameless like some of these investors are trying to claim.
    29 Jun 2009, 12:23 PM Reply Like
  • bigduke
    , contributor
    Comments (5) | Send Message
     
    The other life sentences should be applied to the "supervisory" agencies who should have caught the @#$@%^^ early on his greedy and foul path.
    2 Nov 2009, 09:21 AM Reply Like
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