Who is your money safe with in the stock market? Only you, investing the research and the time

The alleged Ponzi scheme by Bernard Madoff of investors around the world continues to be the talk of Wall Street and financial markets around the world.

And the lesson from what has amounted to the wiping out of massive personal fortunes is that the only person you can trust when it comes to investing in the stock market is yourself. Brokers, financial advisers and big celebrity financial names are no replacement for your judgment. They make sure to get their cut from your investment. Then, what happenes to your money is of no concern.

The bottom of this post provides a definition of a Ponzo scheme.

Here is what The Wall Street Journal reported about the fallout:

New potential victims emerged of Wall Street veteran Bernard Madoff's alleged giant Ponzi scheme, with international banks, hedge funds and wealthy private investors among those sorting out what could amount to tens of billions of dollars in losses.

New York Mets owner Fred Wilpon, GMAC LLC Chairman J. Ezra Merkin and former Philadelphia Eagles owner Norman Braman were among the dozens of seemingly sophisticated investors who placed money on what could prove to be history's largest financial scam.

Several hedge funds, which are you used to wiping out other people, also have recorded massive losses.

So what is one to do? Watch the hell out of CNBC, Bloomberg News or Fox Financial on a daily basis. Learn which analysts to trust over several months while watching the markets' trajectory. I did, and I got out of the stock market above 12,000.

You are smart enough to do the same, too. Trust yourself, not these people.

Here is the definition of a Ponzi scheme from the SEC:

Ponzi schemes are a type of illegal pyramid scheme named for Charles Ponzi, who duped thousands of New England residents into investing in a postage stamp speculation scheme back in the 1920s. Ponzi thought he could take advantage of differences between U.S. and foreign currencies used to buy and sell international mail coupons. Ponzi told investors that he could provide a 40% return in just 90 days compared with 5% for bank savings accounts. Ponzi was deluged with funds from investors, taking in $1 million during one three-hour period—and this was 1921! Though a few early investors were paid off to make the scheme look legitimate, an investigation found that Ponzi had only purchased about $30 worth of the international mail coupons.

Decades later, the Ponzi scheme continues to work on the "rob-Peter-to-pay-Paul" principle, as money from new investors is used to pay off earlier investors until the whole scheme collapses. For more information, please read pyramid schemes in our Fast Answers databank.