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Business Partner C1 Unit 3.1

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Daniela Magalí
Daniela Magalí
Argentina

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Finance and investment

Business Partner C1 Unit 3.1

Daniela Magalí
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MAKE INVESTORS REWARDS MAKES PROFIT STOCKS INVESTMENT

Economic Bubbles and Ponzi Schemes
An economic bubble starts when any group of ? for example , those associated with the internet ? begin to rise . The trend encourages people to buy stocks or shares , which leads to more publicity , which , in turn , causes more people to make an in them . This often millions for those who reap the of investing early . Successful will tell you how easy it is to millions quickly , which causes the stocks or shares to rise further , attracting newer investors . Critics say the system is a kind of Ponzi scheme , where more investors must be found to buy shares from the previous investors . Eventually , one runs out of foolish investors and the bubble bursts .

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RATE PROFIT REPAYMENT PROFITS INVESTED

A Ponzi scheme is , therefore , a scam , or form of fraud which attracts ingenuous people and pays profits to earlier investors . The original investors are tricked into believing that their are a result of product sales and do not realise that new investors are the actual source of their profits . The business appears to be in as long as there are new investors who put money into the scheme and those investors do not demand and continue to believe they ? own ? assets , or part of the company .
The scheme is named after Charles Ponzi , who became notorious for it in the US in the 1920s . However , Sarah Howe carried out a similar scheme in Boston in the 1880s . Howe offered female clients an 8 percent monthly interest on something called the ? Ladies Deposit ? . She then stole the money from the women who had in it , but was later discovered and sentenced to prison .

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