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Ponzi schemes pay out large returns in the short-term, making you think it's a good idea to put more money into them. Uber has done one better, and paid no one
by mabbo 10y ago
Ponzi schemes pay out large returns in the short-term, making you think it's a good idea to put more money into them. Uber has done one better, and paid no one anything in terms of returns, yet still collected billions in investment.
- vannevar 10y agoWell, earlier investors are seeing paper returns. But other than consumers who are getting subsidized rides, yeah, no real payout.
- dopamean 10y agoThere were a few funds of funds that saw big paper returns with Madoff as well.
- LaikaF 10y agoThe subsidized ride thing is pretty crazy too. Uber offered me the ability to pay them a fee, then get a number of flat rate rides. I got a ten pack, used it to go across my city (a 25 dollar ride normally, even with pool) for 2 bucks. I think they lost a grand total of 200 bucks on me alone, and I haven't touched the app since then. Switched back to Lyft when they offered a saner version of the same thing.
- nerfhammer 10y ago"Ponzi scheme" apparently is just invective that can refer to any sort of market failure now, not necessarily the actual Ponzi scheme type investment fraud such as that which Charles Ponzi carried out. In this particular example, remember that Charles Ponzi's books were totally fake; outright fraud. That does not characterize other phenomena such as other things like speculative bubbles or simple investment gambles that don't pay off. In contrast the Bernie Madoff scam is a recent example of an actual Ponzi scheme.