Posts Tagged Ponzi

Scatter Map of Madoff’s Victims

February 6, 2009 at 7:03 pm · Filed under Python, Random Thoughts ·Tagged , , , ,

When I learned that the court had made a list of Madoff’s victims available, I immediately wanted to graph it.  I first forwarded the PDF one of my best friends.  Within a couple hours he had converted it to text, which he streamed through Yahoo Pipes to generate KML suitable for viewing with Google Maps.  The pipes filtered out duplicates, did address discovery and geolocation.  Unfortunately, Google Maps can’t display more than 80 markers at once, which is far less than the thousands of people whom Madoff ripped off.  He eventually did pull off a single view visualization, but it ran like a dog.

So last night I took a different approach.  I extracted out all of the zip codes from the list.  (Ignoring all of the international investors robbed by Madoff.)  Then I used http://geocoder.us to map each zip code to a latitude and longitude.  Next I wrote a short script in NodeBox to draw a projection of the zip codes on a canvas.  Each point is color coded to indicate the number of times that zip code occurs in the court document.  I was helped a lot by code and ideas in Ben Fry’s Visualizing Data book, which I have access to via Safari Bookshelf.  In particular, I stole his function for projecting out the latitude and longitude numbers.

Here are the resulting images.  The perfectionist in me would love to tinker with this for hours.

scatter map of Madoff's victims in the NYC Metro area

scatter map of Madoff's victims in the NYC Metro area

scatter map of Madoff's victims in NYC Metro area

scatter map of Madoff's victims in NYC Metro area

scatter map of Madoff's victims in New England

scatter map of Madoff's victims in New England

scatter map of Madoff's victims in Florida

scatter map of Madoff's victims in Florida

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You Can’t Cheat an Honest Man

January 27, 2009 at 4:57 pm · Filed under Business ·Tagged ,

There was a long investigative reporting piece on Bloomberg today about Bernie Madoff’s enablers.  The article makes the point that many of Bernie’s investors and feeders suspected Bernie was a cheat, but they didn’t mind as long as they benefited.  For example, it quotes a fund of fund’s executive as responding to an accusation that Madoff was front-running his brokerage clients by saying, “Yeah, so what?  That’s his edge.”

The article mentions a book, by James Walsh, titled You Can’t Cheat an Honest Man.  I like the title, which he borrowed from a 1939 W.C. Fields movie.  Although I feel badly for the people whom Madoff victimized, I think that the phrase rings true.  For years people had been claiming that Madoff’s returns weren’t feasible, but investors piled on anyway.  Some feeders, such as Fairfield Greenwich, “put 53 percent of its assets into Madoff’s hands and charged clients 20 percent of profits; it added a 1 percent management fee in October 2004.  For the $7.3 billion funneled to Madoff, they reaped $102 million per year, assuming Madoff returned a phantom 10%.

Not all people went along for the ride though.  The article reports that Oswald Gruebel, who was head of private banking at Credit Suisse, suspected something was wrong and “urged customers to withdraw from Madoff’s funds.”  Apparently only about half of the money was taken out.

Incidentally, a google search for the phrase, “you can’t cheat an honest man” turned up this prescient editorial from November, 2005 by Christopher Laird.  He wrote:

The US right now is in the same economic boat. A 5 year housing bubble has caused real estate to rise in most cites by over 100%, and because real estate is easy to leverage, people using historically low interest rates have basically succeeded in mortgaging their houses well past levels that would be sustainable.

Now people have been enticed into an endless cycle of buying on credit cards and sold the lie of using a home mortgage to pay those off, only to begin the cycle again. And now we have these new bankruptcy laws that are waiting to lower the boom on the many people who were enticed and unwisely accumulated lots of debts, having been seduced by a chimera of rising housing values that are only going to fall off a cliff once the people realize the jig is up. 90% of them will lose their shirts… sadly….

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