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Author Topic: Bloomberg: Is Global Finance a Ponzi Scheme? Ask a Russian Expert  (Read 1608 times)
bitcoinBull
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June 10, 2012, 05:32:22 AM
 #1

http://www.bloomberg.com/news/2012-06-06/is-global-finance-a-ponzi-scheme-ask-a-russian-expert.html

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What's the difference between today's global finance system and a Ponzi scheme? This is the question that a 56-year-old veteran Russian financial scammer has been asking his victims.
Chillingly, he almost has a point.

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benjamindees
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June 10, 2012, 06:50:35 AM
 #2

I could've sworn this was discussed last year, but I can't seem to find it.

Apparently it's Bitcoin-denominated:

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Saturday, January 15, 2011
As MMM shares will be used by electronic coin Bitcoin.  They have a very good defense and international circulation.

http://translate.google.com/translate?sl=ru&tl=en&js=n&prev=_t&hl=en&ie=UTF-8&layout=2&eotf=1&u=http%3A%2F%2Fsergey-mavrodi.blogspot.com%2F&act=url

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benjamindees
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June 10, 2012, 07:43:03 AM
 #3

This is actually an interesting example of a rather intriguing idea.  If the ponzi is big enough, and goes on long enough that it affects the money supply, it will eventually invite a response from the central bank.  The central bank will interpret the constricted money supply as deflation, and print.  But, instead of reversing the "deflation", this newly-printed money will simply feed the ponzi and cause it to grow.

And, if you think about it, this is exactly what the too-big-to-fail banks did over the last decade or so in the US.  They simply took the money that the FED printed for them, and traded it back and forth among themselves in a pointless unproductive game, creating $600 trillion in fraudulent derivatives in the process.  When this eventually dried up all the money in the real economy, leading to the crash of '08, the FED's response was to print more money to give to the banks, perpetuating and expanding the ponzi.

So the question becomes then, in a way, was the '08 financial crash just another example of blowback?  We know that the CIA had a hand in crashing the Soviet economy in the late 80's / early 90's.  The failed Soviet economy prompted Mavrodi to develop his ponzi in '94, which was wildly successful due to the widespread economic destruction in Russia at the time.  So, perhaps it got the attention of someone who exported it to America?  That would give the banks just enough time to begin lobbying for the repeal of Glass-Steagall in '95 in order to address "market realities" by removing the barrier between printed FED money and ponzi investments, enabling US banks to "compete with foreign firms" ie Russian ponzi schemes.  This legislative coup eventually succeeded in '99, just in time for the "terrorist attacks" in '01 and the resulting money printing that followed.

The rest, as they say, is history.

So, perhaps there is some truth to Paulson's claim that Russia caused the '08 crash.  Maybe he knew more about this than he let on.

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proudhon
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June 10, 2012, 08:49:50 AM
 #4

http://www.bloomberg.com/news/2012-06-06/is-global-finance-a-ponzi-scheme-ask-a-russian-expert.html

Quote
What's the difference between today's global finance system and a Ponzi scheme? This is the question that a 56-year-old veteran Russian financial scammer has been asking his victims.
Chillingly, he almost has a point.

The first thing that came to mind as I read the article - Pirateat40.
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June 10, 2012, 12:07:09 PM
 #5

The first thing that came to mind as I read the article - Pirateat40.

I almost mentioned him in the OP. iirc there's some speculation he puts his deposits in MMM.

Not to single out Pirateat40. I'm equally wary of anything GLBSE related.

As for global finance, always funny to remember that in an interview last year Bernie Madoff said the "whole government is a Ponzi scheme."

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June 10, 2012, 12:08:37 PM
 #6

Takes a criminal to know one. The criminal being bernanke in this case!

bitcoinBull
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June 10, 2012, 12:22:09 PM
 #7

This is actually an interesting example of a rather intriguing idea.  If the ponzi is big enough, and goes on long enough that it affects the money supply, it will eventually invite a response from the central bank.  The central bank will interpret the constricted money supply as deflation, and print.  But, instead of reversing the "deflation", this newly-printed money will simply feed the ponzi and cause it to grow.

And, if you think about it, this is exactly what the too-big-to-fail banks did over the last decade or so in the US.  They simply took the money that the FED printed for them, and traded it back and forth among themselves in a pointless unproductive game, creating $600 trillion in fraudulent derivatives in the process.  When this eventually dried up all the money in the real economy, leading to the crash of '08, the FED's response was to print more money to give to the banks, perpetuating and expanding the ponzi.

But here's the thing, the amount of money the Fed can print isn't a drop in the bucket of that $600 trillion in credit/leverage/derivatives which disappeared in the blink of an eye when the house of cards collapsed. That's what most goldbugs don't get. "Printing money" (Fed buying its own treasuries aka quantitative easing, TARP bailout, stimulus funds, etc.) and credit expansion (isn't happening even at zero interest rates) are two different things.


So the question becomes then, in a way, was the '08 financial crash just another example of blowback?  We know that the CIA had a hand in crashing the Soviet economy in the late 80's / early 90's.  The failed Soviet economy prompted Mavrodi to develop his ponzi in '94, which was wildly successful due to the widespread economic destruction in Russia at the time.  So, perhaps it got the attention of someone who exported it to America?  That would give the banks just enough time to begin lobbying for the repeal of Glass-Steagall in '95 in order to address "market realities" by removing the barrier between printed FED money and ponzi investments, enabling US banks to "compete with foreign firms" ie Russian ponzi schemes.  This legislative coup eventually succeeded in '99, just in time for the "terrorist attacks" in '01 and the resulting money printing that followed.

The rest, as they say, is history.

So, perhaps there is some truth to Paulson's claim that Russia caused the '08 crash.  Maybe he knew more about this than he let on.

Interesting theory, but I wouldn't say his ponzi in '94 was wildly successful. It only lasted 6 months!

Quote
Back in February 1994, amid the turmoil of the country's transition to a market economy, the mathematician organized a Ponzi scheme called MMM. He offered returns of 100 percent a month and advertised aggressively on national television. Before the pyramid crashed in July 1994...

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hennessyhemp
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December 31, 2013, 01:51:18 AM
 #8

I know I'm resurrecting a dead thread here, but I have to voice my thought that the full extent of Ben Bernanke's Ponzi scheme has never been fully realized by the global economy, and I believe that was the one that did exactly what you describe here.  The Royal Families were investing with Bernanke, hence their financier killing himself in his office upon Bernanke's arrest.  In fact...I believe we're at the top of a triple top reversal in the S&P 500, but the market is being manipulated heavily if not downright driven upward with hot air while the whales exit safely.  

This is the biggest house of cards in history...and Bitcoin looks to be part of the winds of change.

http://mutualfunds.about.com/b/2013/05/29/buffett-dumping-stocks-should-you.htm

Please add more BTC here (my son will apprecciate it when he's older): 14WsxbeRcgsSYZyNSRJqEAmB1MKAzHhsCT
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