Picking up on Dean Rotbart’s piece in the Jewish Journal about how much was actually lost from the Madoff swindle - and it's probably less than the $50 billion being bandied about - Dan Mitchell, professor emeritus at UCLA's Anderson School, makes a good point about counting "phantom profits." Those were the gains that investors thought they had made with Madoff - except that they were never real. Sound familiar? As explained by Mitchell:

Banks and other financial institutions thought their investments in mortgage-backed securities were "real", held them on their books, and then the valued disappeared. One could say the value was "phantom" but it was the disappearance of the phantom that produced the current crisis. If people believed that they had $50 billion in claims (assets) in Madoff's fund and behaved as if they had such claims, then it was real until it wasn't.