interesting story on the demise of the Mets which blames the Katz/Wilpon reliance on Bernie Madoff for the years of dismal Mets history that ensued when his ponzi scheme was discovered Link - ( New Window )
"Fred Wilpon, who recommended Madoff’s supposed financial wizardry to many close friends, including the Hall of Fame pitcher Sandy Koufax, called it the biggest betrayal of his life, and once likened it to a serrated knife being plunged into his heart."
I don't buy that he and Katz didn't know what was going on.
Boggles my mind the MLB didn’t step in and force sale
Hammer, I think it's a close call whether they knew; certainly Trustee Picard's suit against the Mets and ownership alleges they should have known, not exactly guys who fell off the back of a truck. A client of mine, its CEO, nice guy, was a Bernie client, and sometimes in his office he would wax 'wondrous' at 'Bernie's' returns (at the time Madoff's name did not register with me). He was a convert, for sure. Investors and their greed were willing to ignore skepticism and gratefully keep filling their piggy banks...willful ignorance.
pj, not a hit piece per se, more a chronicle of how the Madoff debacle gutted liquidity of the Mets' franchise/ownership, how the 'Wilponzis' (the term is used to describe fans' dismay and anger) had to scramble to keep the ship of state afloat, ultimately forced to sell the 49% interest to stave off bk.
Hammer, I think it's a close call whether they knew; certainly Trustee Picard's suit against the Mets and ownership alleges they should have known, not exactly guys who fell off the back of a truck. A client of mine, its CEO, nice guy, was a Bernie client, and sometimes in his office he would wax 'wondrous' at 'Bernie's' returns (at the time Madoff's name did not register with me). He was a convert, for sure. Investors and their greed were willing to ignore skepticism and gratefully keep filling their piggy banks...willful ignorance.
pj, not a hit piece per se, more a chronicle of how the Madoff debacle gutted liquidity of the Mets' franchise/ownership, how the 'Wilponzis' (the term is used to describe fans' dismay and anger) had to scramble to keep the ship of state afloat, ultimately forced to sell the 49% interest to stave off bk.
thanks CHP, so nothing groundbreaking? Most of that timeline was already known and it comes up every year on July 1 when the Mets get ridiculed for Bobby Bonilla Day.
Bud Selig forced 10 years of additional punishment
on Mets fans because of his friendship with Fred. We all know Selig told him basically, you can keep the team but you need to hire Sandy as the adult in the room.
Unbelievable.
We know Alderson has his issues, specifically building a bullpen but the fact that the Mets saw a World Series and 2 playoff appearances in that span really speaks highly of him.
Jeff Wilpon pressured players (like Pedro) to play hurt...
Madoff didn't turn him into a a spoiled, rich, arrogant, abusive dummy.
Doubleday had him pegged correctly all the way back in the early 2000's when they essentially ran a hostile takeover of the team. Just an arrogant d-bag.
RE: Bud Selig forced 10 years of additional punishment
We know Alderson has his issues, specifically building a bullpen but the fact that the Mets saw a World Series and 2 playoff appearances in that span really speaks highly of him.
Alderson did a pretty damn good job, considering he basically had one hand (financially) tied behind his back.
thanks CHP, so nothing groundbreaking? Most of that timeline was already known and it comes up every year on July 1 when the Mets get ridiculed for Bobby Bonilla Day.
Absolutely nothing: a chronicle of the debacle triggered by Madoff's passing. The Bonilla 'annuity' appears as one of Wilpons' typical financial transactions: everything run through Madoff accounts--both BB and Wilpons expected to profit from running cash/credit through the money making machine. If I recall right, the piece is written by David Waldstein, not a beat with a grudge or a muckraker, if I'm characterizing the writer properly.
There were banks, insurance companies and investment funds who invested with Madoff. There were a lot of people invested who were a lot smarter than Fred Wilpon.
Before he resorted to his Ponzi scheme, Madoff had earned credentials as a big time trader and investor. He had chops and people respected his judgement. He just made some bad moves, and instead of coming clean tried to cover it up with the scheme.
and Katz didn't know what was going on. A number of accounting people from both the Mets and Sterling warned them that Madoff's returns were too good to be true. Since they were reaping the rewards, they didn't want to hear it. Selig should have forced them to sell the moment the news broke.
until recently I decided to work with a fiduciary with a small portion of my retirement investments.
Before I agreed to work with this fiduciary, I did some research, including what questions to ask. The first question is: are you a fiduciary? (not all financial advisors are) The 2nd is: who is the custodian?
Obviously, the Wilpon's never asked Bernie those 2 questions because obviously he was NOT a fiduciary and there was NO 3rd party custodian (he was the custodian)!
He was the exact type of person one should NOT trust!
There were banks, insurance companies and investment funds who invested with Madoff. There were a lot of people invested who were a lot smarter than Fred Wilpon.
Before he resorted to his Ponzi scheme, Madoff had earned credentials as a big time trader and investor. He had chops and people respected his judgement. He just made some bad moves, and instead of coming clean tried to cover it up with the scheme.
I don't know that I'd assume that a bank or pension fund that invested with Madoff was "smart" per se. Also most of the banks that invested with Madoff were foreign, so their books wouldn't be subject to annual audit like a US bank would.
Also, it's not like these bigger investors couldn't figure out what Madoff was doing, they just didn't bother to look. They assumed Madoff was on the up-and-up based on who he was. That's pretty dumb, IMO.
As far as investing in the first place, the capital that the banks invested was likely a tiny fraction of whatever the total that prop desk was investing. Similarly with pension funds.
Basically these guys spread their capital around to so many funds, they just look to see if a particular fund hits a profile. Like "hey, we need to allocate more capital into market neutral funds with consistent returns... go invest 2% of our capital in Madoff."
There were banks, insurance companies and investment funds who invested with Madoff. There were a lot of people invested who were a lot smarter than Fred Wilpon.
Before he resorted to his Ponzi scheme, Madoff had earned credentials as a big time trader and investor. He had chops and people respected his judgement. He just made some bad moves, and instead of coming clean tried to cover it up with the scheme.
I was at a dinner a number of years ago with some college buddies who worked on Wall St. This was before the Madoff scheme became public, and his name came up. Every one of them said their firm wouldn't touch him, that something fishy was going on. People may not have known exactly how he did it, but they knew he was up to something.
I thought I remember reading that they were early investors who made made money investing with Madoff. Didn’t Picard try to claw money back from them to pay back investors who lost money? Don’t know how successful he was with them?
As an aside, two points. First, Madoff was a highly successful money manager and a very wealthy man aside from his psychotic behavior. The clean side of his form was very profitable. Second, people write off the damage he caused saying he only hurt rich people. Really, not true. Probably multimillion dollars of charity funds were stolen by him directly or indirectly as charity donors pulled back because of their losses. There had to be a special place in hell for Madoff as well as his enablers.
There were banks, insurance companies and investment funds who invested with Madoff. There were a lot of people invested who were a lot smarter than Fred Wilpon.
Before he resorted to his Ponzi scheme, Madoff had earned credentials as a big time trader and investor. He had chops and people respected his judgement. He just made some bad moves, and instead of coming clean tried to cover it up with the scheme.
I was at a dinner a number of years ago with some college buddies who worked on Wall St. This was before the Madoff scheme became public, and his name came up. Every one of them said their firm wouldn't touch him, that something fishy was going on. People may not have known exactly how he did it, but they knew he was up to something.
Most people (some don't - sounds like your friend's firm didn't) forget the age old saying ...
" If it is to good to be true, it probably is"
especially when it comes to money. They WANT to believe.
without evidence I still believe they were crooked as hell.
but as an investor if I'm getting returns that are "too good to be true", is it really my obligation to investigate it or is it my job to just cash the checks?
I seriously don't know.
Who says what's too good to be true. funds/investments outperform the market all the time.
so, maybe the Wilpons knew, they probably did, but the premise of "these returns were too good to be true" does not compel me to believe they had a right to investigate and therefore bear some culpability.
they're culpable because they probably knew and didn't give a F.
"Fred Wilpon, who recommended Madoff’s supposed financial wizardry to many close friends, including the Hall of Fame pitcher Sandy Koufax, called it the biggest betrayal of his life, and once likened it to a serrated knife being plunged into his heart."
I don't buy that he and Katz didn't know what was going on.
I don't by that ANYONE wasn't at least suspicious. the returns had barely any deviation for decades.
Flat out, the Met's were destroy for a decade by the combination of Wilpon power madness and Wilpon managerial incompetence.
Even with the vast reduction in wealth of the Wilpons, the revenue generating capability of the Mets as an economic resource NEVER CHANGED by a plugged nickel. The Wilpons ignored the very simple concept of optimization: maximizing the revenue generating capability of a consumer economic resource by making it as attractive as possible TO THE CONSUMER.
And how do you do that? Very simply by figuring out how much revenue the Mets resource could generate, if you created the most attractive possible product--i.e., the best possible package of players at the point where:
a) the revenue generating potential MINUS
b) the cost potential
maximizes out.
Magically, the mere fact that the Wilpons' cost structure skyrocketed after they lost all that wealth did NOTHING to the revenue generating potential of the team that would come from having great players, and a great farm system.
THE WILPONS DIDN'T GIVE A RAT'S ASS, so long as they could hold onto power. So, they whined about how Maddow destroyed the Mets ASSET when it did no such thing. Had they sold a large majority stake to David Einhorn in 2011, they could have invested all of that wonderful cash back into acquiring new players and a better farm system. But, that would have interfered with the Wilpon scion's ego. They then stopped spending and blamed it on Maddoff. IT WAS ALL A LIE.
They almost got away with it again when they tried to cancel the Cohen sale. Fortunately, that didn't happen.
this nonsense about "big market muscle" taken away with madoff being found out is revisionist history that benefits the wilpons story with a scapegoat instead of focusing on their cheapness and mismanagement the entire time they had the team.
I don't buy that he and Katz didn't know what was going on.
Selig and Wilpon were buddies. McCourt with the Dodgers didn't have a fraction of the issues (and he had major issues) that the Mets did.
I can't read a NYT story, but in the end who cares?
is this a hit piece on Wilpon/Katz? They're villains, no one is going to be shocked if that's what this is.
Wilpon (Fred and Jeff), Madoff, Katz - not a sympathetic character among them.
And what's funny is how Steve Cohen (Bobby Axelrod) becomes the white knight, lol.
pj, not a hit piece per se, more a chronicle of how the Madoff debacle gutted liquidity of the Mets' franchise/ownership, how the 'Wilponzis' (the term is used to describe fans' dismay and anger) had to scramble to keep the ship of state afloat, ultimately forced to sell the 49% interest to stave off bk.
pj, not a hit piece per se, more a chronicle of how the Madoff debacle gutted liquidity of the Mets' franchise/ownership, how the 'Wilponzis' (the term is used to describe fans' dismay and anger) had to scramble to keep the ship of state afloat, ultimately forced to sell the 49% interest to stave off bk.
thanks CHP, so nothing groundbreaking? Most of that timeline was already known and it comes up every year on July 1 when the Mets get ridiculed for Bobby Bonilla Day.
Unbelievable.
We know Alderson has his issues, specifically building a bullpen but the fact that the Mets saw a World Series and 2 playoff appearances in that span really speaks highly of him.
Madoff didn't turn him into a a spoiled, rich, arrogant, abusive dummy.
Madoff didn't turn him into a a spoiled, rich, arrogant, abusive dummy.
Doubleday had him pegged correctly all the way back in the early 2000's when they essentially ran a hostile takeover of the team. Just an arrogant d-bag.
We know Alderson has his issues, specifically building a bullpen but the fact that the Mets saw a World Series and 2 playoff appearances in that span really speaks highly of him.
Alderson did a pretty damn good job, considering he basically had one hand (financially) tied behind his back.
Before he resorted to his Ponzi scheme, Madoff had earned credentials as a big time trader and investor. He had chops and people respected his judgement. He just made some bad moves, and instead of coming clean tried to cover it up with the scheme.
Before I agreed to work with this fiduciary, I did some research, including what questions to ask. The first question is: are you a fiduciary? (not all financial advisors are) The 2nd is: who is the custodian?
Obviously, the Wilpon's never asked Bernie those 2 questions because obviously he was NOT a fiduciary and there was NO 3rd party custodian (he was the custodian)!
He was the exact type of person one should NOT trust!
Before he resorted to his Ponzi scheme, Madoff had earned credentials as a big time trader and investor. He had chops and people respected his judgement. He just made some bad moves, and instead of coming clean tried to cover it up with the scheme.
I don't know that I'd assume that a bank or pension fund that invested with Madoff was "smart" per se. Also most of the banks that invested with Madoff were foreign, so their books wouldn't be subject to annual audit like a US bank would.
Also, it's not like these bigger investors couldn't figure out what Madoff was doing, they just didn't bother to look. They assumed Madoff was on the up-and-up based on who he was. That's pretty dumb, IMO.
As far as investing in the first place, the capital that the banks invested was likely a tiny fraction of whatever the total that prop desk was investing. Similarly with pension funds.
Basically these guys spread their capital around to so many funds, they just look to see if a particular fund hits a profile. Like "hey, we need to allocate more capital into market neutral funds with consistent returns... go invest 2% of our capital in Madoff."
Before he resorted to his Ponzi scheme, Madoff had earned credentials as a big time trader and investor. He had chops and people respected his judgement. He just made some bad moves, and instead of coming clean tried to cover it up with the scheme.
I was at a dinner a number of years ago with some college buddies who worked on Wall St. This was before the Madoff scheme became public, and his name came up. Every one of them said their firm wouldn't touch him, that something fishy was going on. People may not have known exactly how he did it, but they knew he was up to something.
As an aside, two points. First, Madoff was a highly successful money manager and a very wealthy man aside from his psychotic behavior. The clean side of his form was very profitable. Second, people write off the damage he caused saying he only hurt rich people. Really, not true. Probably multimillion dollars of charity funds were stolen by him directly or indirectly as charity donors pulled back because of their losses. There had to be a special place in hell for Madoff as well as his enablers.
Quote:
There were banks, insurance companies and investment funds who invested with Madoff. There were a lot of people invested who were a lot smarter than Fred Wilpon.
Before he resorted to his Ponzi scheme, Madoff had earned credentials as a big time trader and investor. He had chops and people respected his judgement. He just made some bad moves, and instead of coming clean tried to cover it up with the scheme.
I was at a dinner a number of years ago with some college buddies who worked on Wall St. This was before the Madoff scheme became public, and his name came up. Every one of them said their firm wouldn't touch him, that something fishy was going on. People may not have known exactly how he did it, but they knew he was up to something.
Most people (some don't - sounds like your friend's firm didn't) forget the age old saying ...
" If it is to good to be true, it probably is"
especially when it comes to money. They WANT to believe.
but as an investor if I'm getting returns that are "too good to be true", is it really my obligation to investigate it or is it my job to just cash the checks?
I seriously don't know.
Who says what's too good to be true. funds/investments outperform the market all the time.
so, maybe the Wilpons knew, they probably did, but the premise of "these returns were too good to be true" does not compel me to believe they had a right to investigate and therefore bear some culpability.
they're culpable because they probably knew and didn't give a F.
I don't buy that he and Katz didn't know what was going on.
I don't by that ANYONE wasn't at least suspicious. the returns had barely any deviation for decades.
Even with the vast reduction in wealth of the Wilpons, the revenue generating capability of the Mets as an economic resource NEVER CHANGED by a plugged nickel. The Wilpons ignored the very simple concept of optimization: maximizing the revenue generating capability of a consumer economic resource by making it as attractive as possible TO THE CONSUMER.
And how do you do that? Very simply by figuring out how much revenue the Mets resource could generate, if you created the most attractive possible product--i.e., the best possible package of players at the point where:
a) the revenue generating potential MINUS
b) the cost potential
maximizes out.
Magically, the mere fact that the Wilpons' cost structure skyrocketed after they lost all that wealth did NOTHING to the revenue generating potential of the team that would come from having great players, and a great farm system.
THE WILPONS DIDN'T GIVE A RAT'S ASS, so long as they could hold onto power. So, they whined about how Maddow destroyed the Mets ASSET when it did no such thing. Had they sold a large majority stake to David Einhorn in 2011, they could have invested all of that wonderful cash back into acquiring new players and a better farm system. But, that would have interfered with the Wilpon scion's ego. They then stopped spending and blamed it on Maddoff. IT WAS ALL A LIE.
They almost got away with it again when they tried to cancel the Cohen sale. Fortunately, that didn't happen.
this nonsense about "big market muscle" taken away with madoff being found out is revisionist history that benefits the wilpons story with a scapegoat instead of focusing on their cheapness and mismanagement the entire time they had the team.