the.com/ponzi
a business model where yesterday's investors are paid with today's investors' money, forever, until it isn't.
means a fraud that pays early investors with new investors' cash instead of actual profit, collapsing once new money stops flowing in.
from named for charles ponzi, who in 1920 boston promised 50% returns in 90 days via international postal reply coupons, a scheme so thin the arbitrage barely existed, yet thousands lined up to hand him their savings.
actual profit generatednone, ever, by design
madoff scaleran roughly 65 billion dollars, decades undetected
ponzi's real mathneeded 160 million coupons, only 27000 existed
why it endscollapses the moment withdrawals exceed new deposits