Now, here is the essence of Ponzi's scheme - remember, Ponzi was supposed to be buying coupons. He was supposed to send his Italian contacts U.S. dollars and the Italian contacts were supposed to exchange the dollars for Italian lira, buy postal coupons and send them back to Ponzi. Ponzi was supposed to cash in the coupons for stamps and sell the stamps at a discount to large firms and give Ponzi's investors their return.
But, this is not what happened. Ponzi was not buying any coupons. Ponzi was using new investors money to pay previous investors. Of course, with any scheme like this, Ponzi had to add new investors to keep running his scheme. If too many people demand their returns or even their original investment back at once, then the whole thing collapses.
This is the essence of the get-rich-quick idea that attracts investors.
Tommorrow we will discuss how Ponzi was caught.
As always, have a great and fraud-free day.
http://www.tauskvega.com
--------------->>>>>>>>>>>>>>>gene tausk
But, this is not what happened. Ponzi was not buying any coupons. Ponzi was using new investors money to pay previous investors. Of course, with any scheme like this, Ponzi had to add new investors to keep running his scheme. If too many people demand their returns or even their original investment back at once, then the whole thing collapses.
This is the essence of the get-rich-quick idea that attracts investors.
Tommorrow we will discuss how Ponzi was caught.
As always, have a great and fraud-free day.
http://www.tauskvega.com
--------------->>>>>>>>>>>>>>>gene tausk
No comments:
Post a Comment