This blog post originally appeared on RealMoney Silver on Dec. 15 at 8:03 a.m. EST.Life at its best is bittersweet. I have had a good year investing. Some of my oldest friends are also my Limited Partners. My performance in 2008 is a sense of personal achievement for me. Through hard work, a skeptical and independent view and by virtue of hard-hitting analysis, I have made money for my investors in a challenging period. Meanwhile, many of my other friends have been caught up in the alleged Madoff fraud -- many others. As I related on Friday, if accurately reported, the Madoff Ponzi scheme is the biggest fraud of all time, bigger than Bayou and Enron combined. In that column, I detailed my experience of analyzing a Madoff account in 2005, the process of which made me an early nonbeliever because the numbers simply did not add up. I also enumerated six red flags that should have been picked up by investors (and their agents), many of whom put their entire investment capital with Madoff.
- On Thursday night, I attended a black-tie gala party for a charity that has a large percentage of its endowment with Madoff. Unfortunately, this is more typical than not with the many organizations around the country impacted by Madoff. I also know people who work at charities in New England that had all of their endowments with Madoff; some are being laid off now.
- During the weekend, I received calls from a number of acquaintances who had all their money invested with Madoff; some were crying. Their lives will never be the same.
- At a private club in Palm Beach on Saturday night, I sat next to someone who was purported to have lost as much as $400 million in the alleged scam.
- It is already apparent that the high-priced luxury market will be impacted by the alleged fraud. On Sunday, a real estate friend reported to me that already a number of high-priced Palm Beach homes were put on the market over the weekend by victims who have been nearly wiped out financially.