The Inverse Ponzi Scheme

November 12th, 2013
in Op Ed, syndication

Written by

Traditional Ponzi scheme:

Hukster proclaims: "Hi there, Folks. If you invest in my fund, I will pay you a 20% return. It's guaranteed! "
Hukster thinks: "Just as long as more folks keep subscribing enough to keep the scheme turning over, that is, and not forgetting my personal make-me-rich take, naturally. Too bad if you folks start taking your money out, 'cos then you'll lose the lot"


Follow up:

The inverse Ponzi scheme (Hat tip Yanis Varoufakis)

Bankster says: "Morning, Mr Finance Minister! So I hear your government can't pay the country's debts? Well, now, here's what I suggest. I'll make you a deal: You cut government spending and raise some extra taxes. That'll make all your creditors confident you're doing what it takes to find the money to pay them off.
Banskter thinks: "Of course that will make your economy go into slump mode and you'll have even less money to pay your debts with, but it's not my problem if you have a trouble with elementary math."
Bankster says: "Then me and the boys - OK, OK, I know the head's a girl these days - will lend you as much as you like, just so you can go on paying back those people who bought your bonds. 'Course, we shall have to charge interest, but that's normal, aint it!"
Bankster thinks: "You poor sods! If you can't work out that if you're bankrupt now, you'll be bankrupt twice over by the time this deal matures, what do we care so long as we get our cut."
The Editor: "Any suggestion that any of the characters appearing in the above sketch have any resemblance to Christine Laggard, Mario de Goldman, Angela Muddlefrau or Olli Reign-of-T are completely unfounded."

Make a Comment

Econintersect wants your comments, data and opinion on the articles posted. You can also comment using Facebook directly using he comment block below.



Analysis Blog
News Blog
Investing Blog
Opinion Blog
Precious Metals Blog
Markets Blog
Video of the Day


Asia / Pacific
Middle East / Africa
USA Government

RSS Feeds / Social Media

Combined Econintersect Feed

Free Newsletter

Marketplace - Books & More

Economic Forecast

Content Contribution



  Top Economics Site Contributor TalkMarkets Contributor Finance Blogs Free PageRank Checker Active Search Results Google+

This Web Page by Steven Hansen ---- Copyright 2010 - 2017 Econintersect LLC - all rights reserved