Bernard Madoff, former chairman of the NASDAQ Stock Market Inc. (NDAQ), was turned into the authorities by his sons last Thursday after his firm, Bernard L. Madoff Securities LLC, was declared an insolvent “giant Ponzi scheme,” with estimated losses of $50 billion.

Underlying the credit crisis gripping the U.S. and world economies is a crisis of confidence. Blame has been laid at the feet of the U.S. Federal Reserve, and an investment bankers’ brew of toxic financial products. Ultimately, however, it was the supposedly trustworthy rating agencies that got everyone to drink the poisoned Kool-Aid.

Bernie Madoff looks set to be this year’s Grinch, at least for stock investors. His $50 billion ‘Ponzi’ scheme suckered many high-profile institutional investors. And as full details emerge, Frank Hemsley says it could shatter the fragile confidence in the market. This could mean a sharp leg down for stocks before the New Year.

We pause this morning, while the rest of the world contemplates Mr. Madoff’s Ponzi scheme and this week’s pending machinations of the Fed and OPEC, to ponder matters geopolitical. There’s something extremely telling about the reaction to the reporter who flung his shoes at That Lame Duck in the White House. And it doesn’t bode well for the next four years under the new president.