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A pyramid scheme pays out fake returns that were actually new investments, which requires unsustainable geometric growth. An asset bubble doesn’t depend on frau
by erik_seaberg 6y ago
A pyramid scheme pays out fake returns that were actually new investments, which requires unsustainable geometric growth. An asset bubble doesn’t depend on fraud or growth, it just keeps going until speculators’ confidence is shaken.
- redisman 6y agoA pyramid is a more psychologically powerful scam as many people actually get big returns and become true believers. Made up assets are more akin to the tulip mania and such.
- jrochkind1 6y agoMany people actually get big returns from tulipmania and such too!