Madoff Fallout?

A busy week ahead as the calendar starts off with the Fed meeting on Monday and Tuesday, and wraps up with the weekly jobless claims data on Thursday. In between, we'll get the latest on consumer prices, industrial production and home building. Almost everyone expects the FOMC to cut its target for overnight interest rates from 1% to 0.50%, but almost no one thinks the rate cut will do much good in the current environment of fear and risk aversion. Households and businesses aren't borrowing because interest rates are too high; they aren't borrowing because they are afraid the recession will worsen, and because they can't get a loan from banks that are even more afraid than they are.

Boca Raton condos have literally been put up for sale over the weekend as a result of the Madoff Ponzi scheme. Poverty happens fast when you have every dime with one investor. The fund of funds that directed money to this guy should be put out of business by the SEC but that will never happen. Hat tip to the fund of funds managers that saw the fraud and advised their clients accordingly. I don't think splt strike conversion strategies will be all the rage anymore. I also love that Ira Sorkin (former head of SEC) is Madoff's attorney. Oh, the hypocracy, Oh the irony.