The Bernie Madoff Ponzi scheme is swelling and growing in the corner and no-one really wants to think about it. Madoff, a former chair of the NASDAQ board, has been running a scam whereby existing investors are paid with the funds of new investors (the Ponzi name comes from the only episode of Happy Days ever directed by Almodovar, in which Potsy and the Fonz had an affair, and treated Mr Cunningham as their giant baby). Nothing new, except the size of Madoff's scheme -- $75 billion -- which is enough to throw a fresh wobble into the financial system's shaky orbit, and add to the sense that no figure, valuation, price etc can be trusted.
Wednesday, December 17, 2008
The Birth of the Ponzi Scheme
Guy Rundle in today's Crikey (subscription only) explains the etymology of the Ponzi scheme: