Ponzi's Scheme

I just finished listening to "Ponzi's Scheme: The True Story of a Financial Legend," by Mitchell Zuckoff. I found the unabridged book on CD at the library, and having heard so many financial schemes referred to as such, I decided to have a listen.

Wikipedia's definition of "Ponzi Scheme" is as follows: A Ponzi scheme is a fraudulent investment operation that pays returns to investors from their own money or money paid by subsequent investors rather than from any actual profit earned.

Charles Ponzi was always trying to find ways to make lots of money and make his mother proud. Having left Italy, he traveled throughout Canada and the U.S. doing prison terms in both nations, Canada for forgery and the U.S. for helping illegal Italian immigrants.

He wound up marrying and then wanting more than the decent salary he was getting to create of life of extravagance for his wife, which she didn't want (Rose, his wife, just wanted a simple unassuming life). He came upon an idea using foreign exchange and postal exchange coupons with the promise of a 50% return in 45 days to investors.

When the money started rolling in like crazy, he wound up doing a "Robbing Peter to Pay Paul" scheme, now referred to as a "Ponzi Scheme." It was not a new scheme in 1919-20 when he made his run, nor was it the last, but it is the most famous because of the vast amounts of money that changed hands in such a short amount of time. This was mostly due to his personality.

Ponzi tried to go legit, but his scheme unravelled, and unlike most scam artists, he chose to stay and fight because, I believe, he wanted to be an honest person but it just wasn't turning out that way. He got caught up in the money, but he refused to run. He was a rather decent fella.

He died with enough money to bury him in Brazil in 1942.

Oddly, I really like Charles Ponzi. As a dishonest financier and banker, he was truly a decent fella and I believe that he truly at least desired to come clean on his investments and really help the people.

Quite unlike Ken Lewis, whose current scams inlcude robbing the people blind to pay for his banking mistakes and fill his own personal accounts. With the massive overdraft charges, interest rate hikes, and various fees, this scam enacted by Ken Lewis and other shifty bankers is actually legal. Why is it legal? Because they used their vast sums of money to place banking execs in governmental positions to make such things legal. They also have control of vast lobbying firms and own a few congressional types. All this amounts to creating what should be illegal to being legal.

The current banking lobby is working hard on keeping consumer protection out of the equation. Why? Because the banking system may then no longer illegally/legally be able to rob the people to fill their own pocket books and cover up for their illegal/legal bad decisions (like Ponzi's, except Ponzi didn't really want to rob the people like Ken Lewis and other banking CEO's and execs do).

Folks like Ken Lewis aren't so likeable. They don't care about the people. They want to rob the people, and they get away with it. Ponzi went to prison and died, sadly, with only enough money to bury him. Ken Lewis will die carried in a gold chariot created by the money he robbed from the people, people like us. He will die with great praise from the government in which he is part owner (unlike us beasts at the bottom).

Personally, I think it is time for a revolution.