Thursday, January 22, 2009

Caveat Emptor


I was going through my daily routine of checking  the finincial markets (/nerd) when I noticed this article about the Madoff situation. 

The article is about the havoc he has wreaked in the investment markets with his Ponzi scheme, and how the current regulative policies failed. The last line caught my eye "You can’t run a society, or economy, solely on the basis of caveat emptor." Obviously this was on one of our recent vocab quizes so I thought it appropriate to discuss the article here. I realize a number of you wont have much idea of what the article is talking about, but for those of you that do, I'd like to hear thoughts on our current legislative and regulatory systems and how well they work in our current economy. This has been a big political issue as well, influencing the federal governments policies and several of Obama's appointments to economic advisory positions. 

(Steve Szumski)

1 comment:

Eric W said...

It's certainly an interesting question. Should we let individuals take responsibility for their actions, and if they made a bad decision or are deceived, let them be? Or, as a society, do we need to step in a certain times to prevent harm done to the general good of the people? Swinging too much in either direction can result in either unbridled capitalism and greed or communism.

What really interested me about the whole Madoff scandal is the fact that even people who made profits from his scheme will likely have to return those profits (and their investment money) in order to help pay off people who lost money with Madoff. Here, we have individuals sacrificing profit and gain for the common good of all the shareholders. But is it right? That's the question of the day.