You decide.

Just read a provocative piece by Karl Denninger of The Market Ticker. Here is the excerpt:

50 billion [Ed: Madoff Ponzi scheme's estimated losses] is not a small amount of money by anyone's measure. But before one cries too big of a river for those who lost it all in what appears to be the biggest Ponzi Scheme of all time, one should note that a number of people interviewed said they figured Madoff was "cheating" since he was a market maker and had returns they couldn't explain - they just didn't think he was cheating them! A knowing scam? You decide.

The true scam here isn't Madoff though. Its that this sort of attitude - bed, bribe, lie, browbeat and cajole - has become all of what Wall Street is about over the last ten years.

See, we had "investment banks" who "paid to play" with their bond ratings - ratings that were modeled by a computer that was told to assume "house prices will never go down."

Never?

We had other models that "assumed" various ratios (such as debt to income) for no-doc loans, where people didn't even bother stating an income - and others who simply took the "stated" income and believed it - even though HUD [Ed: US Department of Housing and Urban Development.] itself did a study that showed that a plurality of so-called "stated" income loans overstated actual income by as much as 50%! Fraudulent on its face? You decide.

We had our current Treasury Secretary who appeared before the SEC and Congress in 2000 to lobby for the removal of leverage limits, was told (quite literally) to go to hell - that what was he was asking for was unsafe - but he had the audacity to come back four years later with the same request and ramrodded it through. The result? Bear Stearns, Lehman Brothers, AIG, Fannie and Freddie - all "boomed" with leverage more than double the previous legally-mandated limit. Is Paulson responsible? You decide.

We have sitting Congresspeople who got "preferred rates" on loans from Countrywide Financial with cumulative benefits in the tens of thousands of dollars while they were voting to create (or not) additional regulations on the lending industry. Crooked? You decide.

We have a Federal Reserve who's previous chairman created a speculative bubble in the Internet space and when it popped, he knew this should and must lead to the default of the bad debt taken on. But instead of allowing that, he (along with Congress) intentionally blew an even bigger bubble in housing and the American Consumer. Our current Fed Chairman was a member of the Federal Reserve at the time and saw this happen, but made no comment about it. Congress was repeatedly warned that what was happening was unsustainable and did nothing. Idiotic at best, criminally negligent at worst? You decide.