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Is the Financial System One Giant Pyramid Scheme?


To be blunt, what if our entire financial system—as it exists today—is a scam, one that’s hardwired to funnel wealth from the masses to an elite few?

All the world is a cage today, but how can we avoid it tomorrow?

OPINION ARTICLE

David Tal, Staff Writer
Jennifer Lee, Designer

(First published in the Arbitrage Magazine Issue 4)

“I’m careful,” most think.  “I know enough not to get mixed up in these things.”

These are the lullabies people say to comfort themselves.  However, as you’ll see, it’s no defence.

Take the case of Bernard “Bernie” L. Madoff.  He got caught inside a whirlpool last March, 2009, when he pled guilty to running an elaborate Ponzi scheme that fooled a highlight reel of celebrities, charitable organizations and what many considered to be ‘informed/professional’ investors.  The fallout was many tens of billions worth of investments written off into the red—this included the life-savings of many who will now never know a comfortable retirement.

When such high profile scams make headlines, both the victims and the public are left to ask how so many high-powered, intelligent people could be duped so easily.  In retrospect, it seems obvious that an eye of caution be directed upon people or corporations who offer inexplicably high or consistent returns on monies invested.

Haven’t these people ever heard the adage that if something sounds too good to be true, it usually is?  Such questions generally conclude with people mumbling another adage—buyer beware—and then believing that the same thing could never happen to them.

But what if it can?

What if you, dear reader, are already in the clutches of a similar scam to the one suffered by Madoff’s investors?  And what if everyone is in on it, both as victims and perpetrators of the largest financial scam known to human history?

To be more blunt, what if our entire financial system—as it exists today—is a scam, one that’s hardwired to funnel wealth from the masses to an elite few?

Don’t want to believe it?

Well, before you stop reading, how about we play around with this theory?

To start, if we are going to put our financial system on trial, we’ve got to understand how it really works.

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  • https://sites.google.com/site/weatheringtheboomerretirement/ Jumi Pak

    I wholly agree. The financial services industry is a mess of misinformation, fraud, & confusion. I wrote a blog about it. WEATHERING THE BOOMER RETIREMENT: FINANCIAL PLANNING SURVIVAL GUIDE, wherein, I share the ins & outs of my own industry — to empower consumers to know how to fend for themselves against those who capitalize on their clients’ fears & conditioned ignorance. goo.gl/DKNQJ.

  • http://www.insidermonkey.com/insider-trading/ insider trading

    Another method is equity financing
    – the sale of stock by a company to investors, the original
    shareholders of a share. Ownership of a share gives the shareholder
    certain contractual rights and powers, which typically include the right
    to receive declared dividends and to vote the proxy on important
    matters (e.g., board elections)….

  • Freedom

    Article can be summed up in two paragraphs: Since once thriving Western World, started to use socialist ideas and let fallible people (governments) to centrally control the impossible (upredictable and constantly changing economy), it’s on the verge of collapse. Biggest money suppliers and thieves, robbing common people through inflation, are their own governments. We can clearly see that by silent establishment of FED on Christmas Eve in 1913, while population wasn’t paying attention and most opponents from the House of Reps were away with their families. Since then, once richest and strongest country in the history of the world, just in one century is on the verge of collapse.

    SOLUTION: Go back to free market, which in just one century created richest and strongest country in the history of the world on the bare, savage land, where no fallible man centrally controls the impossible (upredictable and constantly changing economy) and humans will prosper like never before, be able to finally go back to exploring the Universe and hopefully finding other planets to survive.

  • http://www.synchronsprecher-englisch.de/ englischersprecher

    If something sounds too good to be true it usually is, also the comment applied retrospectively to many overseas investors who had lost money investing in certain Icelandic banks which had been offering eye-watering interest rates before they collapsed.

  • Heart Beacon Cycle

    http://sawconcepts.com/id28.html if so, why not form islands of equity within the oceans of corruption?

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