The lead article in today’s New York Times, “Stocks Resume Free Fall on Fear over Economic and Credit Woes,” shows just how far the uncertainty unleashed by Standard & Poor’s downgrade of U.S. Treasury securities is spreading. The ratings downgrade, from AAA to AA+, combined with uncertainty over major countries in the Euro zone, including Italy and Spain, is causing investors to panic and move their money out of stock markets all over the world. The Dow continued its free fall, dropping by another 600 points.

Ironically, all the volatility is causing investors to seek safe havens, and they are largely fleeing to U.S. Treasuries, the very investment Standard & Poor’s decided to downgrade. In fact, S&P also continued to issue more downgrades on Monday, specifically to Fannie Mae and Freddie Mac, the mortgage companies backed by the U.S. government. Meanwhile, the political gridlock in Washington cited by Standard & Poor’s for its decision shows no signs of abating.

On the other hand, U.S. corporate balance sheets are widely described as fortress-like by market analysts, and many consider this wave of selling to be an opportunity to pick up some real bargains. Whether this profit-taking occurs today and halts the stock market’s slide remains to be seen.

The lead article in today’s New York Times, “Stocks in Worst Tumble in Two Years Amid Global Worry,” describes an entirely predictable sell-off with the Dow Jones declining 500 points. The lack of confidence was triggered by the failure of the President of the European Commission to commit to any backup of Italy or Spain which are struggling under a massive debt load in the same way Greece has.

But these countries are much bigger than Greece with much larger economies. Concern about their fate combined with the totally unsatisfactory conduct of the debt ceiling debate in the United States led to massive declines in stock markets around the world as well as the United States. And with unemployment numbers for the month due out today, there may be additional blows to the U.S. stock market as well.

The Dow Jones has sunk 11 percent in the past two weeks, but some say it is just an adjustment to an overly optimistic reaction to corporate profits. Whether that’s the case or not remains to be seen. Not all economic news was bad, however, as the price of a barrel of oil declined to $87, and that may mean lower prices at the pump just in time for Labor Day.

The lead article in today’s New York Times, “Hedge Fund Billionaire is Guilty of Insider Trading,” shows that while the times may change, human nature doesn’t. Raj Rajaratnam, a prominent investor, was famous for his diligent business research, and that research led to the founding of his own hedge fund and clients such as UBS and New Jersey’s state pension fund.

However, the prosecutor in this case described Mr. Rajaratnam as doing his homework, but also cheating on the test. Insider trading and yesterday’s conviction, with a possible sentence of 25 years and probable of 19 years, according to federal sentencing guidelines, will ruin the second half of his life.

It is reassurng to see corrupt individuals on Wall Street being held to account, especially after the lack of prosecutions for our recent financial collapse. The use of wiretaps and other investigative techniques has now led to a slew of charges against Wall Street insiders, 47 in all, with 36 having been convicted or pled guilty. This story will help to give “Main Street” some satisfaction after struggling to make ends meet, dealing with credit card debt and beset by a slew of foreclosures.

Mr. Rajaratnam is now under electronic surveillance in his home and faces sentencing on July 19th. Greed is not good; it was his ultimate downfall.

The lead article in today’s New York Times, “Madoff Says From Prison That Banks ‘Had to Know,’” shows a largely unbowed Bernie Madoff, criticizing media coverage of his son Mark’s suicide, and claiming that large banks willfully turned a blind eye to his Ponzi scheme that consumed up to $90 billion.

Mr. Madoff also claims to have helped the trustee, Irving Picard, who is charged with recovering as much of the assets as possible to redistribute to the victims. It is also worth noting that Mr. Madoff claims that the owners of the Mets, Fred Wilpon and Saul Katz, knew nothing of his scheme. That probably says more about the hapless owners of the Mets and their inability to bring National League playoff baseball to the city than it does about Mr. Madoff’s financial acumen.

Mr. Madoff’s home is now a 12-foot square cell with a window, and he has a roommate, quite a comeuppance for someone of Mr. Madoff’s former stature. He claims that his family knew nothing about his financial wheeling and dealing and expressed sadness about the way the scandal has affected them. So, at least he’s somewhat human.

It’s still rather amazing, though, that Mr. Madoff was able to perpetuate his Ponzi scheme for 16 (!) years without being exposed. It’s a shame that a mind like that had to go to waste.

The lead article in today’s New York Times, “$19 Billion Suit Accuses Banker in Madoff Case,” shows how pervasive the greed runs in this entire matter. In addition to revealing a potential partner of Bernie Madoff, Sonja Kohn, a prominent Austrian banker, it describes a series of civil lawsuits by a trustee of the fund, Irving Picard, who is trying to recover up to $50 billion in the matter.

The lawsuits come as a filing deadline approaches two years after Bernie Madoff’s arrest. And while Mr. Picard’s motives are commendable, recovering funds for Bernie Madoff’s victims, the article strikes me for the pervasiveness of money in the entire matter.

If the accusations are true, Sonja Kohn was a central component of Bernie Madoff’s Ponzi scheme. As the article notes, any Ponzi scheme needs a constant fresh infusion of cash in order to survive, and Ms. Kohn was the key to supplying it. She was a well-connected banker and could guide many affluent people to invest in Mr. Madoff’s funds. She allegedly received yearly kickbacks for her role, totalling more than $6.5 million per year.

It strikes me as particularly poignant that this story is breaking in the middle of the Christmas season. How true is Jesus’s saying that you can not worship both God and mammon (money).

The lead article in today’s New York Times, “Origin of Scare on Wall Street Eludes Officials,” describes the inability of market analysts and federal regulators to discover the exact reason for the Dow’s 1,000-point decline on Thursday. The original explanation of an entry error, someone typing a billion dollars instead of a million, seems to be incorrect.

Well, it’s not very reassuring to know that there’s still a weak point in the market structure that can cause a worldwide financial panic. The current theory states that the slide may have been caused by the interrelationship between various markets and the different rules they have about when to stop trading or change procedures in the face of major declines. Electronic automated trading also remains as another possible reason.

Apparently, according to the article, today’s financial markets have become increasingly complex and have broken up into four different sectors: registered exchanges (63.8%), electronic communication networks (ECNs) (10.8%), dark pools (7.9%) and trading inside broker-dealers (17.5%).  The last two hide pricing information from the public until their trades are completed.

Meanwhile, the head of the New York Stock Exchange and Nasdaq have broken into a public feud with each other regarding their differing approachs about when to stop trading. Needless to say, all this is not very reassuring to the individual investor.

Let’s hope they figure it out sometime soon.

The lead article in today’s New York Times, titled “Dow Falls 1,000, Then Rebounds, Shaking Market,” describes a crazy day on Wall Street when the index fell dramatically then rebounded just as quickly. Part of the error, though the exact cause is still unknown, seems to have been traced to a mistyped sell order for a billion instead of a million. This cascaded into automated trading systems and led to a large sell off.

However, the index did finally close down 300 points or about 3 percent. And that was based on real worries regarding the situation in Greece, a country Germany will be reluctantly bailing out today if their legislature approves it. Rioting by Greeks in the face of austerity measures didn’t help the situation either.

At one point during the day, described as resembling the Twilight Zone by one trader, blue-chip stocks such as Procter & Gamble and Accenture fell by as much as 90 percent. Timothy Geithner, the Fed and European Central Banks held emergency conference calls.

All this economic lunacy just heightens the need and immediacy of financial regulation. While the markets are widely acknowledged as superior to the government in setting prices and controlling general economic activity, the article concludes by noting their need for “adult supervision.”

Hopefully, today’s trading will be less frenetic, and the factors leading to these wild gyrations will be better understood, and prevented.

The lead article in today’s New York Times is titled, “Madoff, Apologizing, Is Given 150 Years.” It describes the Ponzi scheme operated by Bernie Madoff and the reaction to his sentence as it was handed down yesterday by Judge Denny Chin.

Mr. Madoff attributed pride to his downfall, yet it was even more striking, according to the article, that noone testified about any good deeds he had done. The judge himself described the crimes as “evil,” and Bernie Madoff was labelled as a monster. A crowd waited to accost him outside the courtroom but were denied the opportunity as he was whisked in and out through another entrance.

In my opinion, Bernie Madoff has come to typify an era of Wall Street excess and greed, and the scope of his fraud and deception is, indeed, breathtaking. To lose your life’s savings, for even one person, causes indescribable pain, and that feeling was multiplied manyfold in this scandal.

But does Bernie Madoff really represent evil incarnate? Or is it a failure of the system that resulted in the steady expansion of his scheme? I’m unsure. I hate to demonize anyone, and his sins were economic ones compared to the genocides that occur all too frequently around the world.

I think we should be satisfied that justice was served, and try to move on from this sordid matter.

The lead story in The New York Times today was titled, “Fed Will Inject $1 Trillion More to Aid Economy. “  The Fed will accomplish this by printing the extra money and buying treasury bonds and mortgage securities.

According to the article, the fed’s decision doubled all of its measures from last year. It was designed to  lower interest rates for loans and thus encourage more economic activity.

Wall Street seemed to approve of the move by gaining over 90 points. But to me, it represents just one more indication that things aren’t going very well. One reason for the Fed’s move was that it could no longer lower its own interest rates to spark activity as the rates have been lowered so many times already, they’re hovering near zero.

And it also gives an indication that the other methods we’re trying aren’t working very well either, otherwise such a drastic action would be avoided, especially by the ultra-conservative Fed.

The whole situation reminds me of a sand castle. Sure, you can build some walls around the castle and hold off the tide, but it’s only a temporary measure. Eventually, the tide will break through the walls, and the castle will be doomed.

In the same way, the U.S. economy is too large to be affected by our fiscal and monetary actions, and the size of our problems will overwhelm even our boldest solutions. The tide will come in and hopefully, it will eventually go out again.

Today’s lead story in The New York Times was titled, “Madoff will Plead Guilty; Faces Life for Vast Swindle.” It describes additional details about the scandal and notes that Madoff could face a prison sentence up to 150 years, effectively life.

Bernie Madoff seems to represent all that’s bad with Wall Street and the culture of greed. But, in a perverse sort of way, he may cause a lot of good things to occur.

His fraud, now estimated at $65 billion, is so mind boggling that it may result in much stricter regulation of Wall Street, and protection of innocent investors, than would have occurred otherwise. Oh sure, we can be shocked at the size of bonuses provided by financial institutions, but these represent the systemic bias of our system and unfettered capitalism itself.

Madoff’s scandal suggests a much more harmful form of corruption because it goes beyond self-aggrandizement and inflicts life-altering suffering on innocent victims. The article in The Times notes, as of the end of November, there were 4,800 client accounts in Mr. Madoff’s roster. And also included were$10 million from 35 labor union pension plans.

The way Mr. Madoff was able to compound his deceit and rise to the top of the Wall Street elite suggests a more inherent corruption of the system than just the profit motive. As far back as 1989, Mr. Madoff handled more than five percent of the volume in the New York Stock Exchange and was ranked among the highest-paid people on Wall Street by Financial World magazine.

Mr. Madoff, by getting caught, may have done far more good than he ever intended.