The Defining Characteristics of a Ponzi Scheme

What Does a PONZI SCHEME Look Like, Anyway?

You've heard the term before; sometimes in conjunction with the other term Pyramid Scheme, (although not to be confused with as these are 2 separate types of money schemes).  But what exactly is a Ponzi Scheme and what does it look like?  I had to ask my self these questions recently, because, to be honest, I am rather new to multi-level-marketing and other types of network marketing businesses and lately I have come across quite a few "business opportunities" that I really got a "ugly feeling" in my gut about, yet I didn't know why.  So after some research I am beginning understand what the "ugly feeling" is all about. 

First off the term "Ponzi Scheme" actually comes from a man by the name of Charles Ponzi, who in the early 1900's made his mark on the world.  He was an Italian swindler, who is considered one of  America's greatest swindlers and con artist in all history.  The term "Ponzi scheme" is a widely known description of any scam that pays early investors returns from the investments of later investors. (taken from Wikipedia).  With no real product or profit from the product he was selling, he managed to make a fortune just off of investor capital and he did this very quickly. I suppose this is also where the term "get rich quick" came from. (click here to read the entire wiki article)

After seeing this article it is more clear to me exactly what a Ponzi Scheme looks and let me tell you, lately I have seen a lot of them.  Seemingly, honest, good meaning people are falling for these every day and some of these people are promoting them, why?  Probably because they are in need of money and it is a way to create "instant wealth", sound familiar? 

I have ran across many of these on traffic exchanges and also forums and social networks.  Sometimes it is hard to tell exactly what a person is "selling" until you fill out the all too familiar sign up form to get access to the product or service being offered.  But if the company is promoting the business and the earnings more than the actually product, all I can say is watch out.  If the company is promoting recruitment more than the product, watch out. 

Is this to say that multi-level-marketing businesses fall into this category?  Perhaps some can; you must ask yourself the question (or one like it) "does it look like a chicken, cluck like a chicken, etc, etc".  I'm convinced that there are very good business opportunities out there that require a real investment of time and money.  There is no such thing as a free ride on someone else's efforts when it comes to earning money or running a business. Make sure you have a real product or service to sell and that the product is the focus of your business, not the money, this is the key, I think.  

As I am just learning about this I am sure there is more to know.  My eyes are being opened wider every day to this, and I have asked myself on more than one occasion lately, what would I be willing to sacrifice morally, to earn a few quick bucks?  Maybe this is something we all need to consider. 

Just my thought for the day.

Talk to you later