It's a Mad, Mad, Madoff World

The latest in a series of earthquakes in the financial world is the news that one of Wall Street's most successful private investment firms was nothing more than a $50 billion Ponzi scheme. A Ponzi scheme is a fraud: someone claims to offer you an excellent return on your money and actually pockets the money, paying off previous clients with your cash. It was named after Charles Ponzi, an Italian immigrant who set up a scheme in Boston almost a century ago that made millions. (Mr. Ponzi landed up in both Federal and State prisons.)

Now there are three extra zeros added to the 21st century sequel: billions of dollars were invested with Bernard Madoff, a Jewish New York investor whom everyone thought was brilliant and a pillar of his community. There seems to be nothing left of the money. "We think it went to money heaven," an investigator said.

"It's all basically a lie," Mr. Madoff confessed to his sons just before being arrested.

Mr. Madoff is allegedly a first-class fraud, but how is his hoax much different from the so-called honest brokers and bankers of Wall Street who have lost trillions of investor money? I'm no economist or lawyer, but when trillions of dollars are gambled and lost by clever people, is there no penalty? The problem is, the entire global economy has been built on greed and cheating. So where do you draw the line?

And it's not just about money. The imbalance of wealth achieved by those who manage (and lose) other people's money corrupts the society as a whole. Greed becomes an ideal rather than the powerful human fault that it really is.

Communism failed, in part, because it did not engage people's greed. The totalitarian state works by fear, not greed. But fear does not make people work hard. Greed does. Unfortunately, greed creates its own imbalances, which ultimately corrupt the whole system in a different way. Its like pigging out. Eventually a person pays the price for stuffing himself by becoming ill. Society also pays for pigging out.

In my own life experience, i have witnessed the effects of greed. It's unhealthy, malignant and damaging. Multiply that by millions and you get a society that is totally out of balance and discordant with nature.

On Wall Street, earning a million dollars is nothing special, and many money managers make incomes of $20 million or more. While the incomes of doctors, lawyers and Wall St. executives have inflated, ordinary workers wages are flat. And while doctors try to "do no harm," (although they often do no good and sometimes unintentionally do a lot of harm), the same can't be said for high-powered Wall St. bankers. They cleverly exploit a bubble, create an illusion of high profits, and when the bubble bursts, ordinary people lose their pensions and life savings, while the bankers keep their million dollar salaries and bonuses.

Most of all, the vast riches and quick money being made by a few promotes an unsustainable and corrupt myth: that you can get something for nothing. We idolize men who can make a lot of money, regardless of how they do it, or whether they are actually contributing anything useful or not to society. That's what Srimad Bhagavatam tells us is standard in Kali Yuga. If you can show money, you are a gentleman to be respected. If you can't, you're an unfit beggar, perhaps a criminal. But who are the real criminals? You never know in a mad, mad, madoff world.