I saw this today and thought it worth sharing.  Barry Ritholtz has a great blog called The Big Picture that is essential daily reading.  I saw this graph today in one of his posts (via JP Koning).

I don't know how much further we'll go (meaning we'll go down more) but this at least puts this decline into a bit of perspective.

You just can't make this stuff up (via Dealbreaker).

Here's the pitch:

• The "firm" is Agape World, Inc. where they provide "the bridge to your future"
  
• You invest between $5,000 to $3 million in short-term high yield loans to developers and builders
• The terms of these loans range from 10 to 12 weeks
• You earn as much as 14% in as little as 72 days
• The company was named one of America's fastest growing companies by Entrepreneur Magazine

Wow!  Sign me up!

But:

• The founder of the firm is a convicted felon and served 21 months in FEDERAL PRISON for previously defrauding investors through a securities firm.
• Part of his sentence included undergoing therapy for a gambling problem.

What's wrong with you people?  Are you so blinded by greed that you forget how a search engine works?  Ever heard of the Internet?  How about checking with FINRA or the SEC about the firm?

Oh wait, it must be the government's fault.

The scams and schemes continue to reveal themselves as we exit this period of absurdity and, yes, stronger regulatory oversight could have helped but a little common sense goes a long way. 

If it sounds to good to be true, it is (especially when a convicted felon with a gambling problem is the one telling you).

Strong words from Jim Rogers regarding the current financial situation, where things are headed, and where to be going forward.  I like him and take his point of view seriously although I balance it with a variety of others and suggest you do the same.

His main point?  "Own the things where the fundamentals have not been impaired" and he thinks those are commodities, the Japanese Yen, and the Swiss Franc.  Oh, and he warns of an inflation tsunami on the horizon due to the currency printing presses working overtime to inject liquidity globally.

http://vimeo.com/moogaloop.swf?clip_id=2537254&server=vimeo.com&show_title=1&show_byline=1&show_portrait=0&color=&fullscreen=1

Nicely done video via the good folks at WallStreetFighter on the hedge fund game.  We will surely look back on this period and wince at the idiocy and greed.  Where was the oversight for "alternative investments" and those benefiting from the 2/20 model?
A look inside hedge funds from Marketplace on Vimeo.

I am still trying to get my head around the news about Bernard Madoff and his $50 Billion (yes, Billion with a B) fraud.  This is being way better reported in the financial pubs but seems as if many people wondered how this guy could consistently engineer such great returns.  That, of course, didn't stop the money from flowing in which was necessary because that money was being paid out as returns.  How unimaginative.  If you are going to cause this kind of wealth destruction you'd hope it would be done in a more innovative way.  But I digress…

The losses are adding up as those who lost come forward (or are forced forward).  There are some doozies with Banco Santander at $3.6 billion, HSBC at $1 billion and no shortage of others with big losses including some very wealthy folks.  Here's a list from the NY Times.

Markets are brutal and unforgiving and no one can consistently outperform them (even if you are not running a scam).  Just ask Bill Miller of Legg Mason about his track record of beating the S&P 500 now.  This guy consistently beat the S&P 500 index until recently and he is down, way down.  Stick to index funds (not leveraged ones), own individual stocks for a hobby, and enjoy the ride.  You will do no better or worse than the market this way and save yourself both some emotional strain as well as "management" fees.

Via The Big Picture from Dilbert.

Ok, so this letter isn't nearly as uncomfortable to read as the one that has to go out to those who lost $2 billion when Texas Pacific Group led an investment in now JP Morgan assimilated Washington Mutual but it is still a good read.  Here's the NYTimes DealBook story on it.

It is a letter to shareholders in the TPG-Axon fund covering recent market "activity."

So for 2% mgmt fee plus 20% of any profit, how'd we do?  It can all be summed up in one word, according to fund manager Dinakar Singh – "abysmal."  Here's an article covering the launch of the fund a short four years ago with much fanfare and hype.

Mr. Market takes no prisoners and no matter how smart you are, how much data you have, or how confident you are in you abilities, he will get the best of you.  Just ask Mr. Singh.

Where are the opportunities according to Mr. Singh going forward?  Distressed mortgages, Chinese stocks and transportation. 

Are hedge funds good investments?  Well, think about the word "hedge" for a minute.  If it were a true "hedge" then wouldn't it have protected these investors against recent market craziness?

No thanks, I'll stick to index funds

This is an interesting PBS Bill Moyers interview to watch (via The Big Picture).  I have read one of Kevin Phillips' books in the past (Wealth and Democracy) and he is definitely a smart guy.  He has a new book out called Bad Money.  This is far from uplifting but is an interesting perspective about what is going on and the path ahead.

is upon us.  Asian market are down big as of right now and tomorrow should be another crazy day here in the US.  Everybody calm down as this is all part of the ride and the time to remind yourself that you are (hopefully) a long-term investor.

Bear Stearns "soft landing" at JP Morgan Chase with US Gov backing

US Gov bailout of Fannie & Freddie

An active US Gov hand in Merrill Lynch joining Bank of America (led by a Southerner no less!)

And now a mondo $85 billion US Gov loan to AIG for an 80% stake (via warrants)

Lehman Brothers got nada because they apparently hadn't done enough damage and now Barclay's is picking up a few select pieces.

Man, I sure am glad we have free markets here.  Oh wait…

Which leads me to the conclusion that yes, things are/were that bad.