Maybe it’s because I have not lived in America for awhile, or maybe my education was lacking in this area, but for whatever reason, I had no idea what the media was talking about when they talked about Bernard Madoff and kept referring to a “Ponzi Scheme” without explaining what it was!
All I kept thinking about when I read it was “Arthur Herbert Fonzarelli” aka, the Fonz. (Those were some Happy Days!)
So I eventually broke down and googled it and got an answer from Wikipedia:
A Ponzi scheme is a fraudulent investment operation that pays returns to investors from their own money or money paid by subsequent investors rather than from profit. The term “Ponzi scheme” is used primarily in the United States.
There you go, I learned something today… and maybe so did you! Doing my part to educate my readers (both of you.)
Hi! I'm Steve Webel and this is my blog. Thanks for stopping by!
Social Security and Medicare are also Ponzi schemes.
Both of those certainly do seem to fit the description – except for the part where a Ponzi scheme is a scam being run unbeknownst to the investor and SS is a mandatory TAX that our government levies on us. It does make me think though… what a mess!