Is investor education adequate solution to investor fraud?

Investor education seems to bring unemployment and recession. Off course I am not saying investor’s education is useless, but it is not an adequate solution to investor’s fraud. Main problem is people don’t think rational. We want to believe in the ideas of ridicules returns which are literally impossible to achieve.

I will use an example of Madoff to show why I think investor’s education is not adequate solution. If we look at the list of people who invested in Madoff mega billion schemes were deeply involved investment businesses. Of course they are supposed to be experts at investment if they take care of people investments.
How can you believe in such a high constant return on investment? Are you trying to beat GDP of a country?
Basic Rule how can put all your eggs in one basket?

I was shocked when I saw the list of investor, come on they are bank and investment companies they are suppose to manage our money and protect us from investment frauds. NOT GET US INVOLVED IN INVESTMENT FRAUDS.

Here is a list of some investors, or I should say some investment bank who invested in this fraud scheme. (Click on the image to see complete list)

Now the question is what convinced these people to get into this scheme?
Madoff paid high return to old investor and then of course our famous weapon word of the mouth got many others into this.

Basically thinking rational is very important in any kind of education. Investor education alone, without thinking rational can be dangerous instead of helping us.

Investor education can be really helpful if used with rational thinking. Is it a adequate solution to investor fraud, no because we don’t like to think rational. We want to believe that high unachievable returns are possible.

Younas Saleem Economy