Wednesday, February 04, 2009

Why not give Markopolos a job?

Bloomberg Story on Madoff Proceedings in Congress

"The officials, in joint testimony, said the regulator may stiffen audit requirements for money managers and inspect firms more frequently. The SEC is also examining how it evaluates risk and may require investment advisers to provide more information than it currently requires, according to the testimony."

This ignores the fundamental problem with Markopolos/Madoff. Markopolos gave them everything they needed, they did the investigation, and they still didn't admit that anything was wrong. They don't understand the global financial system. (Really, who does?) They don't understand hedge funds and other complex strategies.  Why don't they just hire Markopolos? Well, for one, he doesn't want to move to DC and they don't pay enough. However, with current financial industry salaries going downward ($500k salary limits!), they could meet in the middle geographically and financially. Pay $300k for SEC employees to live in New Jersey.  I'd move to NJ for $300k.

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