It's been a busy year in the financial sector. My 401K has lost a ton of money and my investments are about as rotten as some putrid meat. All that said, I've learned a few things.
This week Bernie Madoff plead guilty to 11 counts of securities and financial related charges. You see, he operated a pyramid scheme. In the US, it's commonly called a Ponzi scheme which is named after Charles Ponzi who became famous by offering high returns on short-term investments by taking money from other people and giving it to the previous investors. According to the courts, this will get you jail time.
On the other hand, I've been watching wall street's financial crumble due to bad investments. Apparently, if you take non-existent money, lend it to people you won't have any cash. Ok, not let this happen simultaneously happen for several companies. Wait... nobody's getting jail time here. Instead, the government is picking which companies get to stay in business then use taxpayer money to pump them full of cash like a body builder squirting 'roids into their veins. They call this a "bailout". If it were me personally, they'd be calling it "filing for bankruptcy".
So the moral of the story here kids is if you plan to make bad investments and rip people off, make sure you're a large company holding investments of influential senators and congressmen.
Sunday, March 15, 2009
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Wait until you apply the rules of a Ponzi Scheme to Social Security.
ReplyDeleteYou might want to wrap duct tape around your head, just in case. I don't want to be responsible for the mess. :)
Ooh... I never thought about that. But they're doing good like Robin Hood. Take from the workers and give to the lazy ones; they deserve it! Besides, what would we do with all the surplus cash and welfare workers if everyone actually tried to hold a job? Geesh.
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