What is ponzi? I give 0.05 btc to the best answer

[felipelalli]

What is Ponzi? What is this and why should I keep distance (or not) of it? Thanks. Plz put your address with your reply.   

[Explodicle]

"A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation." - Wikipedia

Assuming you want more money, you should avoid Ponzi schemes because you are more likely to lose money than to gain money.

1NtTPVVjDsUfDWybS4BwvHpG2pdS9RnYyQ

[felipelalli]

"A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation." - Wikipedia

Assuming you want more money, you should avoid Ponzi schemes because you are more likely to lose money than to gain money.

1NtTPVVjDsUfDWybS4BwvHpG2pdS9RnYyQ

Thanks mate. Is it a kind of piramyd schema? Sorry for did not search it on Google, but I am in a really slow Internet now in my mobile (I am far away from civilization right now) I'll give you the 0.05 and if you can say more about this fraudulent schema I glad you. Thansk

[DannyHamilton]

Is it a kind of piramyd schema?

Generally in a pyramid scheme the participants are aware that they are being paid a percentage of the funds that they recruit.  Additionally, only those who successfully recruit investors "earn" any funds.

With a Ponzi, the participants are typically mislead to believe that they are "investing" in a venture that is earning profits for all involved.  The early investors spread word of the opportunity on the belief that it is legitimate and successful.  Someone operating a Ponzi will typically try to discourage anyone from withdrawing funds, and will encourage them to "re-invest" any reported earnings.  When a few people attempt to withdraw small amounts, the Ponzi operator will pay out these amounts from the total funds collected, regardless of who they came from or whether the person withdrawing recruited anyone else.  These early small payouts give an impression that the investment is safe.  Eventually more people will want to withdraw funds than the Ponzi operator has available.  At that time, he must shut it down and it slowly becomes clear to everyone involved that they will not be getting any further funds back.  It is also possible for the Ponzi operator to run off with the funds once they have collected a large amount even if nobody is requesting to withdraw their funds yet.

[Jutarul]

"A Ponzi scheme is a fraudulent investment operation that pays returns to its investors from their own money or the money paid by subsequent investors, rather than from profit earned by the individual or organization running the operation." - Wikipedia

Assuming you want more money, you should avoid Ponzi schemes because you are more likely to lose money than to gain money.

1NtTPVVjDsUfDWybS4BwvHpG2pdS9RnYyQ

Thanks mate. Is it a kind of piramyd schema? Sorry for did not search it on Google, but I am in a really slow Internet now in my mobile (I am far away from civilization right now) I'll give you the 0.05 and if you can say more about this fraudulent schema I glad you. Thansk

Ponzis are not the only ways to get ripped of. You already mentioned pyramid schemes. Also beware of "bets", especially if they are not enforceable or the escrow is corrupt.

In general, whenever you invest in a business, ask for a business plan or the specific mechanism by which the returns are generated. (Alternatively if you're an expert in the business you already know what's possible and what not) If there is no break down of numbers available, then it's probably a scam.

[JoelKatz]

It's also important to understand that Ponzi operators are very concerned about being identified as operating Ponzi schemes so they will frequently take actions that are against their own interests (such as turning down deposits) just to look less like a Ponzi scheme. The key signs to identify a possible Ponzi scheme are:

* A promise of returns well above market rates. (If it sounds too good to be true, it probably is.)

* Consistent returns regardless of market conditions. (If it sounds too good to be true, it probably is.)

* No actual evidence of any legitimate investment activity.

* No actual known business model. Descriptions are usually vague and non-committal, sometimes contradictory. Operators will frequently say things like "you're getting the idea" or "something like that" as a way to allow people to convince themselves that they know what the business model is, with each investor having their own ideas.

* Testimonials from people who made money without any explanation of what the actual source of that money was.

* Pressure not to withdraw or encouragement to re-invest proceeds.

* Pressure to spread the word and recruit more investors.

* No plan in place for how losses, should they be incurred, will be proven to be legitimate investment losses or how they will be recovered.

* Long-term increases in the amount of money "invested" despite no known reason to need high-interest loans.

[felipelalli]

Amazing! Thanks for the answers. It sounds like marketing pyramid? Herbalife or something like this? But how should someone so stupid to get in into a such so clearly bad scheme?

[Etlase2]

But how should someone so stupid to get in into a such so clearly bad scheme?

Starts with g and ends with reed.

[JoelKatz]

Amazing! Thanks for the answers. It sounds like marketing pyramid? Herbalife or something like this? But how should someone so stupid to get in into a such so clearly bad scheme?

It's kind of hard to understand if you haven't experienced the psychology. On one level, you know it's a scam but think that you'll be able to get out on time or withdraw your principle and only lose interest. But on another level, you manage to convince yourself that maybe it's the real deal and you are in on the secret to amazing wealth.

[felipelalli]

But how should someone so stupid to get in into a such so clearly bad scheme?

Starts with g and ends with reed.

hahaha

but greed can be good. I call it only stupidity

[finkleshnorts]

It's kind of hard to understand if you haven't experienced the psychology. On one level, you know it's a scam but think that you'll be able to get out on time or withdraw your principle and only lose interest. But on another level, you manage to convince yourself that maybe it's the real deal and you are in on the secret to amazing wealth.

This

[DannyHamilton]

. . . how should someone . . . get in into a such so clearly bad scheme?

First of all the really talented Ponzi operators are very charismatic and persuasive.  They go to a lot of effort to make the scheme look like a legitimate and trustworthy investment.

Second of all it is human nature not to want to be the fool who is left out of something good that the people around you are experiencing.  If your family, friends, neighbors, coworkers, etc. are all talking about how they trust this great investment and they are all making a significant amount of money, the average person starts to feel that they are foolish for turning down this opportunity.

The Ponzi operator is skilled in convincing people that they can be trusted and that those who don't get involved are fools.

[felipelalli]

Very interesting. I have a ex-teacher, a kind of distance friend now, she's very beautiful and she ask to me enter in a scheme like this. I wonder if she is honest or not. She is just trying to get her own investment back or is it possible she is making real money? If she is, she try to recrute more victims because she really believes on it or because she KNOWS clearly how it works and is trying to get more fools? I always wonder myself about it.

[Jutarul]

Very interesting. I have a ex-teacher, a kind of distance friend now, she's very beautiful and she ask to me enter in a scheme like this. I wonder if she is honest or not. She is just trying to get her own investment back or is it possible she is making real money? If she is, she try to recrute more victims because she really believes on it or because she KNOWS clearly how it works and is trying to get more fools? I always wonder myself about it.

She may be LOCKED IN. (e.g. study the 20 dollar auction, http://www.slate.com/articles/arts/everyday_economics/1998/11/party_tricks.html)
She may just want to get her investment back.

[felipelalli]

Very interesting. I have a ex-teacher, a kind of distance friend now, she's very beautiful and she ask to me enter in a scheme like this. I wonder if she is honest or not. She is just trying to get her own investment back or is it possible she is making real money? If she is, she try to recrute more victims because she really believes on it or because she KNOWS clearly how it works and is trying to get more fools? I always wonder myself about it.

She may be LOCKED IN. (e.g. study the 20 dollar auction, http://www.slate.com/articles/arts/everyday_economics/1998/11/party_tricks.html)
She may just want to get her investment back.

Thanks for the link. But is she honest or not? That's what I do not understand. I guess if she knows the truth, why is she trying to put me in? Sometimes I think she is acting like a puppet of someone.

[Jutarul]

....
She may be LOCKED IN. (e.g. study the 20 dollar auction, http://www.slate.com/articles/arts/everyday_economics/1998/11/party_tricks.html)
She may just want to get her investment back.

Thanks for the link. But is she honest or not? That's what I do not understand. I guess if she knows the truth, why is she trying to put me in? Sometimes I think she is acting like a puppet of someone.

I see what you mean. Maybe it's similar to the way many people here think about bitcoin. They WANT to believe. And they want to SHARE their believes, especially with the ones who are close. That makes them blind to the shortcomings of the underlying business.

If find myself recommending bitcoin to a lot of people, because I think it's a disruptive technology with a lot of potential. However, I always add a word of caution - and I don't recommend it to someone who I think is not fit in computer security.

If you want to "help" your friend getting out of a vicious cycle, ask for details of the business - help her to see the inner workings of the business. If she can clearly explain how things work, maybe she's on to something?

[bitcoinbear]

Let me give an example:

"Want to make a nice profit? 10% guranteed!" You give me $10.

Next day, I give you $1. Wow, you just made 10% in a day. You sell your computer and give me $1000. Now your account is at "$1 010".

Next day I give you $101. Wow, you just made 10% in a day. You mortgage your house and give me $100 000. Now your account is at "$101 010".

The next day you cant find me, I ran away with $100 908.


1M6w49QQRz7vGWzgiPYLKKkWFjAZ6hSd5Y  Money sent to this address will not be invested in ponzi schemes.

[Jutarul]

Let me give an example:

"Want to make a nice profit? 10% guranteed!" You give me $10.

Next day, I give you $1. Wow, you just made 10% in a day. You sell your computer and give me $1000. Now your account is at "$1 010".

Next day I give you $101. Wow, you just made 10% in a day. You mortgage your house and give me $100 000. Now your account is at "$101 010".

The next day you cant find me, I ran away with $100 908.

Also called a long con. Build up credibility and then exit when the stake is high.

[max in montreal]

you guys are way way off. Ponzi was a character on a tv show called happy days. there was ponzi, fotsie, richy and ralph. ponzi used to bang on a jukbox and it would play music for free. a jukebox is like an mp3 player but mutch bigger. his office was in the bathroom of a restaurant where the owner would wax on wax off. sunday monday happy days, tuesday wednesday happy days, thursday friday happy days, saturday... what a day, groving all week with you... ponzi wore a leather jacket.

AAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAAyyyyyyyyy yyyyyyyyyyyyyyyyyyyyy.

http://www.youtube.com/watch?v=gMxkMy9JvXI

[felipelalli]

....
She may be LOCKED IN. (e.g. study the 20 dollar auction, http://www.slate.com/articles/arts/everyday_economics/1998/11/party_tricks.html)
She may just want to get her investment back.

Thanks for the link. But is she honest or not? That's what I do not understand. I guess if she knows the truth, why is she trying to put me in? Sometimes I think she is acting like a puppet of someone.

I see what you mean. Maybe it's similar to the way many people here think about bitcoin. They WANT to believe. And they want to SHARE their believes, especially with the ones who are close. That makes them blind to the shortcomings of the underlying business.

If find myself recommending bitcoin to a lot of people, because I think it's a disruptive technology with a lot of potential. However, I always add a word of caution - and I don't recommend it to someone who I think is not fit in computer security.

If you want to "help" your friend getting out of a vicious cycle, ask for details of the business - help her to see the inner workings of the business. If she can clearly explain how things work, maybe she's on to something?

it's true. But isn't necessary to ask her more details. She just talk a lot about this and sent more then 10 long youtube videos trying to explain the business, but it is unclear at all, it's hours of bullshit and.. Maybe I never will know if she really believes that or she is dishonest