Member-only story
Bernie Madoff Was Not a Monster
But the system that produced him is
I recently watched the Bernie Madoff documentary on Netflix and encourage you to do so if you have a few hours to spare on understanding the world’s largest Ponzi Scheme.
The title of the piece is a bit tongue in cheek (once you watch the documentary), but it’s also something than many people think and believe: Bernie Madoff was a monster that took advantage of poor, unsuspecting investors. He duped the SEC and thousands of people who poured 19 billion dollars into his “hedge fund.”
I felt little sympathy for the people harmed in the documentary. Wall Street is not your friend. It’s a cut-throat, make money or lose it world.
But the documentary reveals some flaws in the system, flaws that won’t be solved by more or less regulation, or better ethics. The biggest flaw I think it points out is…
The Lies We Tell Ourselves
More than anything, what kept Madoff alive was the lying. It wasn’t just the lies he told all of his investors; those are the obvious.
The less obvious lie was that this man could beat the market so consistently. They had lied to themselves.
Many investment books will tell you: there is no way to beat the market. Warren Buffet famously beat hedge…
