What is a Ponzi Scheme?
Apr 24, 2015
As Posted on www.usaponzi.com
A Ponzi scheme is a fraudulent investment operation where the operator, an individual or organization, pays returns to its investors from new capital paid to the operators by new investors, rather than from profit earned by the operator.
The current U.S. Government fiscal policy (USAPonzi) fits that definition perfectly. The U.S. Government promises to pay social benefit returns that are irrational and unaffordable and does not collect enough tax revenue to pay these benefits leaving the cost of these social benefit promises to the next generation(s) of U.S. taxpayers and uses a corrupt and fraudulent accounting system to help cover up the scheme. The U.S. Government is using Cash Accounting rather than the appropriate GAAP (Generally Accepted Accounting Principles) Accounting.
This is exactly what the Madoff Ponzi did; promised investment returns that were irrational and unachievable, paid the early investors with money collected from new investors, and used corrupt and fraudulent investor statements to conceal the fraud. Bernie Madoff then skimmed off some of the money from the new investors to be able for him and his cohorts to live opulent lifestyles.
The U.S. Government is doing the exact same thing that Bernie Madoff did. The ruling class has skimmed off $18 Trillion so they can live opulent lifestyles and by undertaxing the upper class by $100 Trillion, has given their upper class cohorts a super opulent lifestyle and made them appear to be filthy rich with counterfeit money.
See The Ponzi Economy for a discussion of Ponzi schemes by the Chief Economist of the World Bank.
Next eBook Commentary: What is GAAP Accounting?