Bernie Comes Out of The Closet was early in mulling over some of the unanswered questions brought to the fore by his out-ing. Now, according to revelations to the SEC reported by Bloomberg yesterday, The Fraud (if that indeed is the correct word), like many other large trading losses, began when his erstwhile legitimate trading strategy scuppered. And, like Jack Barry & Tom Daniels, like Nick Leeson, like Daiwa Bank's Toshihide Iguchi, like Jerome Kerviel, even Martin Armstrong, in the heat of the moment, they all took the cowardly route, employing deception punctuated with hope and invocations to one's preferred deity in order to forestall owning up in the belief that Master Market will sooner rather than later, come to their aid and make all that had gone wrong, right once again. Bernie, it would seem, has fessed to covering up the loss early-on, which was as I had thought, and lays to rest an important outstanding question - important if only from the viewpoint of my sadistic sense of curiosity.
Call me pedantic if you wish, but I do believe this meaningfully differs from most of the common Contrapreneurs listed in Hedgretracker's Hall of Shame, the majority of whom took the unashamedly direct route to [temporary] riches and a permanent entry into the Book of The Less-Than-Illustrious. This neither excuses nor elevates him above the others. But the distinction is worthy of something approximating a sense of pity rather than revulsion (and I direct this in general to the members of the category of folly, rather than Mr Madoff specifically who behaved appallingly in the interviewing two decades of his charade). It is membership in a decidedly human club of folk, who when faced with adversity, unlike Shackleton, acted in a pathetic but empathizably escapist-like denial of reality. Perhaps I could be wrong in my sympathies. Perhaps Shackleton's success in reaching South Georgia from Elephant Island, managing to disembark at all on the wrong side and scaling the mid-island ridge with sweet f.a. for kit may actually have been what Leeson might have resembled had the Kobe quake not coincided with his monster covert naked-short puts on the Nikkei. Perhaps. But, Shackleton didn't lose a man, and so for the moment, I will rubberneck again at the less-than-robust fiber of those who acted poorly in the most crucial heated moments, and then wonder aloud, how many humans out of a thousand do, and would do, and have anti-heroically executed in their spheres, to greater or lesser extents. I fear, that we still place Shackleton on the pedestal precisely because fewer of us, and our brethren, are made of the same stuff.
*not her real name. Cassandra is an investment banker who authors the blog Cassandra does Tokyo.
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