Dangerous, confused and boring!  In Sarah Palin’s world, them’s fightin’ words!  After that choice sound bite, I figured Palin would go all rogue on Martha.  Even though Martha is the queen of all things domestic, she’s a tough cookie and in a head-to-head match up, my money would definitely be on Martha. Here are my five reasons why:

1. The most obvious — Martha’s done time in the “big house.” While she was there, I’m sure she learned all sorts of fun, new uses for her glue gun, not to mention that a knitting needle makes an excellent shiv!

2. With all her crafty experience, Martha has a much better sense of how to work with a holiday turkey when she’s on camera.

3. Sarah may be able to field dress a moose, but Martha can whip it into a special holiday meal and still create a silk purse out of what’s left!

4. Martha is a Jersey girl.  It’s just never a good idea to cross a Jersey girl who lost a $1 billion!

5. Martha is really ticked off that the SEC and federal prosecutors sent her to prison for avoiding an insider trading loss of about $45,000 while they ignored Bernie Madoff and the $18 billion he stole from clients in the biggest Ponzi scheme EVER.  She’s gotta take that kind of anger out on someone!

But Martha is also good at looking at for number one.  I bet if Glenn Beck wasn’t available, Palin might just look to her for some help in 2012!

Actually, if it weren’t for that conviction, Palin might actually ask her to be her running mate in 2012, especially with this recipe for Baked Alaska!

Now that her husband Bernie Madoff is in jail waiting to find out how many more years he’ll spend there (not the minimum security, country club kind, I hope), the focus is now on how much money the feds will ever be able to get back for the victims of his massive fraud. The most logical place to start is with the obvious assets — those that Bernie claims should be left in the hands of his wife, Ruth.

There’s been a lot of speculation about whether Ruth Madoff did or didn’t know what a big crook her husband was. And I’m sure the SEC and criminal prosecutors are trying to figure out if she had enough of a role in his scheme that she ought to be modeling the classy orange jumpsuit, as well.

But that question almost doesn’t matter for investors at this point. The bigger concern is whether the $70 million in cash and assets she’s sitting on is legitimately hers or whether there was a fraudulent transfer of assets from Bernie. (I just love when I still get to talk all SEC legal like!)

Ruth was employed by Bernie’s company, so she probably got some salary, though odds are that was from stolen money, and she did write a cookbook a few years back (or did she?). But would that give her a nest egg big enough to have four homes, millions in jewels and a bank account hefty enough to do some serious damage at Barney’s for years to come?

Doubtful.

The only question that’s really important now is whether the things she claims are hers and hers alone were purchased with money from the fraud, making them fair game to be disgorged (yeah, I’m going all SEC again) to give at least a little back to Madoff’s victims. Ruth did look a tad guilty when she was caught sending some of that jewelry and a few expensive watches out of the country right before her hubby was arrested. Can you say trying to hide the assets long enough to sell them and hide the cash?

So it’s pretty likely she’s going to need some tips to get along in this new economy. My guess is that she hasn’t had to think about economizing for a couple of decades, but the time for her to get in that mode is approaching fast.

I’ve been thinking it’s time for me to go back to my economizing ways — I’m a coupon clipper and dollar store shopper from way back, but I had let those more frugal ways slip in recent years as I was feeling more flush. Now, with the state of today’s economy, I have to flush those ways and go back to what I learned at my mother’s knee. I’m happy to share a few of those tips with Ruth Madoff if she wants because unless she’s got a stash in a cookie jar, she’s going to need a little pin money. Soon.

Will Barack Obama be the Equivocator in Chief?

Apparently it’s OK to hide jewels and heirlooms if you’re a fraud mastermind, and you still don’t have to go to jail!

President Lame Duck gets testy about New Orleans.

Sanjay Gupta might need to hold on to his CNN gig.

Burris is back!

And the voting is already underway for the sex symbols of the Obama administration!

Oh, and it’s time to DE-LURK! Thanks!

Before I became a “recovering attorney,” I practiced law for 15 years, several of them as an enforcement attorney at the SEC. I was ready to fight fraud! I was ready to investigate! I was ready to take on the bad guys!

Reality, however, didn’t take long to set in. My new business cards were barely back from the printer when I realized that the SEC staff is always fighting an uphill battle and would never be able to truly protect investors and fight fraud in any significant way. The bureaucracy was too overwhelming, the procedural hoops too daunting and the staff would never have the resources it needed to do the job the right way.

Why? Money and influence. Two things the SEC needs and has little of. Two things that corporations and investment bankers have in buckets. Remember Enron? WorldCom? Den of Thieves?

The tag line of the SEC has long been “the investor’s advocate.” But the agency’s effectiveness has been taken apart piece by piece because of the ridiculous beliefs held by many that self-regulation in the economic marketplace was a logical thing. Even Alan Greenspan is now shocked that he was so wrong for so long about his theories that ultimately replaced the initial premise of why a federal securities regulator was needed — to compel corporations to tell the truth about their securities and to make brokers, dealers and stock exchanges put the interests of investors first.

The SEC’s noble purpose was probably doomed from the start. Sure, it can keep an eye on some things going on in the markets. But as a relatively small federal agency, it has always been underfunded and understaffed. The odds have been stacked against the Commission when it comes to keeping corporate greed at bay.

On top of that, many people who decide to work there do so to develop an area of expertise so they can leave in a few years and go make the real bucks in the private sector. The SEC suffers from constant turnover and loss of institutional knowledge. A great case might be underway, but if the attorney who’s worked on it for two years leaves, someone else has to pick it up and learn it all over again, delaying an investigation or putting it on the back burner permanently.

The world that the SEC regulates knows that and counts on the perennial lack of resources and staff turnover. The individuals and corporations I investigated did everything they could to stall and draw out the process, by contesting subpoenas for documents and testimony they knew they would eventually have to comply with or by complaining to my supervisors that I was on the wrong track, in the hopes that I would either leave or get bored and frustrated and move on to another case.

So as Congress is getting ready to point the finger at the SEC for falling down on the job and searches for the underling who will inevitably have to take the fall, it had better get ready to own up to its share of the blame. Congress decides how much money (and, therefore, power) the SEC gets, and I can tell you it’s standard practice for Congress to whittle away at the agency’s budget or to say it can hire many new attorneys, but then refuse to fund the positions.

There have been a few who have tried to change things to make the playing field more level. But they’ve failed. The corporations and entities that are regulated spend much time and money on lobbyists to protect their interests, not the interests of the investors. SEC attorneys don’t have their own set of lobbyists; they only have their own personal motivation and professional pride to see things through. That just isn’t enough.

The SEC needs some sharpened fangs, not just a new set of ill-fitting dentures, if anything is going to really change for investor protection. Even though Congress claims it’s serious this time, I’m not holding my breath that the money for that trip to the regulatory dentist is going to happen any time soon.

UPDATE: For a slightly different perspective, check out this post by a former colleague of mine from the SEC.