Word: ponzis
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...someone else will pay you. In this market, prices go up when people believe they will continue to go up. To restore confidence would mean restoring belief in the greater fool. That shouldn't be hard. It's built into human nature. This is why another term for a Ponzi or pyramid scheme is a confidence trick...
...former hedge fund manager, who defrauded clients out of more than $400 million when his ill-conceived ponzi scheme collapsed, suffers from chronic back pain and wears a pacemaker. In his mug shot, he stares quizzically at the camera with the thoroughly un-menacing look of a man who has gotten himself in way over his head. Consequently, when Israel’s lawyers confidently asserted at a bail hearing that “there is no question that Sam is neither a flight risk nor a danger to the community,” they had every reason to believe...
Sure enough, house prices stopped rising in 2006, and now banks and brokerages are taking huge write-downs tied to the mortgage-backed instruments that kept the Ponzi-loan machine oiled. Economists are furiously debating whether we're on the brink of a full-fledged "Minsky moment," in which lending shrinks sharply across the board. Nouriel Roubini, an NYU economist and a widely read forecaster, got a lot of attention in November by professing to see risk of "generalized meltdown of the financial system of a severity and magnitude like we have never observed before." That sounds bad. But even...
Hyman Minsky, an academic economist who died in relative obscurity in 1996 but is now the talk of Wall Street, had a colorful phrase to describe such people: "Ponzi borrowers," he called them, after the early 20th century pyramid-scheme perpetrator Charles Ponzi. Minsky argued that once banks got so sloppy that they handed out Ponzi loans, a financial crisis was inevitable...
...They saved their spare change for rainy days, didn’t get too incensed about politics, and even helped our neighbors out with the two-foot dumps of snow that make surviving Minnesotan winters a Herculean feat. They were far too sensible to fall for deceitful scams and Ponzi schemes–or so I had thought...