In The Great Gatsby you could rent a summer house on Long Island Sound for around $12,000. This was for the “the season” which typically was understood as July and August. Now, in Vanity Fair’s July Issue (my favorite magazine/could not live without) you can rent a quaint little summer place from Vincent and Louise Camuto for $950,000. Or, you might want to contact the Noel’s and rent their vacation home for $350,000 for July and $375,000 for August. According to Prudential Douglas Elliman’s Jane Gill, “ I had one client who demanded $125,000 for August. An oceanfront house with pool. I got a customer who offered $90,000. The owner balked: ‘My husband says we can’t take less than $120,000.’ Finally, after a week, she said O.K.. By then the customer was irked. ‘My new offer is $69,000,’ he said. ‘Throw that at them.’ Now you may be asking yourself ‘how can we mere mortals get such spectacular deals?’ The economy, economy, economy! It is a predators market for those who have disposable means to swoop in and grab up elite properties at all time lows (let me get my checkbook).
Why are these ultra wealthy people not using their vacation homes this summer? They all have one thing (yes I said ‘thing’) in common, Bernie Madoff. If you don’t know about Madoff and his bogus Ponzi Scheme, that he somehow managed to pull off for years without being caught, you must check out the series of articles in the last few issues of Vanity Fair. It really is the epitome of corruption, avarice beyond description and sums up with the greatest efficiency the current banking/lending/investment nightmare.
“The crisis was triggered by the crash of US-based Lehman Brothers -- the 158-year-old firm that survived the American Civil War, two World Wars, the Great Depression, the Cold War and 9/11 but not the sub-prime mortgage bubble. Based on historical precedent that in America property markets had never ever declined by more than 5 per cent, the firm had thrown the dice.”
Essentially everyone was involved in lending money without the capital to back the loans (sub prime lending practices) and taking investment money without the capital to back payoffs. And, the government still has no laws as of yet to regulate this nightmare!!
Just as the rich prospered in the 1920’s before Black Tuesday, the rich of today partied until the end. Madoff actually knew his jig was up, and had his supposedly innocent wife withdraw millions in funds in the days before he was arrested. Then he threw a Christmas bash for his employees who would find out the next day that they had, along with thousands of others, been scammed by a major con-artist (MERRY CHRISTMAS!). Now, most of the public has no sympathy for these Madoff people because they are still affluent; hower, some lost their life savings. Comparatively people in the 1930’s wanted to crucify the Captains of Industry. Groups of employees protested outside of Woolworth’s while Barbara Hutton, who knew nothing of the business her grandfather created and hadn’t worked a day in her life, cried in her silk covered bed, “Why do these people hate me?”
Who is Charles Ponzi?: http://en.wikipedia.org/wiki/Ponzi
June Issue Vanity Fair Letter to the Editor
PORTFOLIO OF LIES
I AM TIRED of listening to investors who supposedly “lost everything” with Bernie Madoff didn’t take and spend all their money; he paid most of it back to them in annual payouts at the rate of 10 to 12 percent a year. Some of his investors funded charities with their returns. Many lived extravagantly for years off these annual payouts, and many have recouped their original investment and become even richer. Now they demand a U.S. taxpayer bailout. They were blinded by greed and seduced by high returns, and want me to reimburse them for their lack of proper due diligence. Ask anyone who has invested in Citibank, G.M., Bear Sterns, or Lehman Brothers over the last couple of years how their investments are doing. I’ll take Bernie’s returns any day.